A study of determinants and impacts of leading Chinese firms’ corporate social responsibility activities

Being helpful and kind is a virtue rooted in Chinese culture. However, profit-making and fast-growth orientation in the Chinese business sector has caused a series of social issues. In 2008, the Sanlu milk scandal and firms’ donations to Wenchuan-earthquake relief were typical bad and good examples of socially responsible behaviors. Given social responsibility on one side and social irresponsibility on another side, this thesis has threefold objectives in response to the lack of thorough CSR studies in China and potential methodology issues. With a combination of multiple theories including stakeholder theory, institutional theory, corporate governance theories and agency theory as theoretical foundations, this thesis first applies fixed-effect models to untangle the factors determining a good level of Chinese companies’ overall social performance in the same year and a lagged year by using a sample of Chinese listed companies from 2008 to 2012. Then this thesis extracts corporate philanthropy from corporate social responsibility for analysis due to the wide practices among Chinese companies. Both quantitative and qualitative content analyses are employed to investigate the stakeholders and institutions driving philanthropy-disclosure compilations and activities disclosed of 120 leading Chinese multinational corporations in 2017. In a further step, whether or not cash and gift-in-kind giving would in turn benefit Chinese firms’ value are examined based on a sample of Chinese listed companies used in the first chapter, but with the time period extends to 2016. The findings suggest that managerial shareholdings reduce the level of overall corporate social performance while rising wages, employment as well as tax payments are the main determinants of a better level of corporate social performance. The thesis also finds that the stakeholder framework, agendas, guidance and standards issued by international- and nation-wide-level institutions play key roles in shaping leading Chinese multinationals’ philanthropy-disclosure compilations. A wider group of stakeholders (e.g. government, employees and charitable foundations), but less institutions, are found to influence the philanthropic activities disclosed. Also, a salient trend of corporate philanthropy development is traced among the leading corporations. The results of the final chapter reveal that corporate philanthropic giving could increase firm value measured by Tobin’s q. Non-government ownership is not found as a moderator between the philanthropic giving-firm value relationship. While executives’ shareholdings play a positive moderating role in the relationship, inferring senior managers’ contrast attitudes towards overall corporate social performance and pure philanthropic giving