We investigate a prevalent yet overlooked form of corporate social responsibility (CSR) activities, i.e., government-launched CSR. Contrary to the conventional view that mandatory CSR destroys firm value, we document a positive market reaction to governmentlaunched CSR activities that aim to alleviate poverty. Analyses of operating performance and firm value confirm the positive impact. Further analyses suggest that while governmentlaunched CSR intervenes the operation of the firm by reducing the operating efficiency, firms enjoy higher operating margin, take more market share and save selling expense and labor cost by engaging their operations with the poverty-stricken areas. Participating firms are also rewarded more government subsidy. We further find that government-launched CSR activities achieve the stated objective of poverty relief. However, it also crowds out the firms' investment in other CSR activities. Overall, the evidence indicates that government-launched CSR has economy-wide implications than the traditional CSR.
Yujing Huang ;
Wei Shi ;
Minggui Yu ;
Dancing with the Elephant: Do Government-launched Corporate Social Responsibility Activities Create Value? （2022年04月13日）http://www.cfrn.com.cn//lw/xjr/zfzcyjgxjrlw/9dc4dcba9248466493e8383a15766636.htm