Do Lenders Value Corporate Social Responsibility? Evidence from China

Journal of Business Ethics

Volumn 104, Issue 2, 2011, Pages 197-206

  Ye, Kangtao ^a   Zhang, Ran ^b  

^a RENMIN UNIVERSITY OF CHINA   (China)

^b Peking University   (China)

Author keywords

China; Corporate philanthropy; Corporate social responsibility; Debt financing cost; Risk management; Size

Indexed keywords

EID: 80255123845     PISSN: 01674544     EISSN: 15730697     Source Type: Journal    
DOI: 10.1007/s10551-011-0898-6     Document Type: Article

References (48)

1. Anderson, R. C., Mansi, S. A., & Reeb, D. M. (2004). Board characteristics, accounting report integrity and the cost of debt. Journal of Accounting and Economics, 37, 315-342.
2. Barnett, M. L. (2007). Stakeholder influence capacity and the variability of financial returns to corporate social responsibility. Academy of Management Review, 32(3), 794-816.
3. Bartkus, B. R., Morris, S. A., & Seifert, B. (2002). Governance and corporate philanthropy: Restraining Robin Hood? Business and Society, 41(3), 319-344.
4. Bassen, A., Meyer, K., & Schlange, J. (2006). The influence of corporate responsibility on the cost of capital. Working paper, University of Hamburg and Schlange & Co.
5. Beurden, P. V., & Gossling, T. (2008). The worth of values: A literature review on the relation between corporate social and financial performance. Journal of Business Ethics, 82(2), 407-424.
6. Bhattacharya, C. B., & Sen, S. (2004). Doing better at doing good: When, why, and how consumers respond to corporate social initiatives. California Management Review, 47(1), 9-25.
7. Boyle, E. J., Higgins, M. M., & Rhee, G. S. (1997). Stock market reaction to ethical initiatives of defense contractors: Theory and evidence. Critical Perspectives on Accounting, 8(6), 541-561.
8. Brammer, S., Brooks, C., & Pavelin, S. (2006). Corporate social performance and stock returns: UK evidence from disaggregate measures. Financial Management, 35(3), 97-116.
9. Brammer, S., & Millington, A. (2008). Does it pay to be different? An analysis of the relationship between corporate social and financial performance. Strategic Management Journal, 29(12), 1325-1343.
10. Bushman, R. M., Piotroski, J. D., & Smith, A. J. (2004). What determines corporate transparency. Journal of Accounting Research, 42(2), 207-252.
11. Chen, H., Chen, J. Z., Lobo, G. J., & Wang, Y. (2010). Association between borrower and lender state ownership and accounting conservatism. Journal of Accounting Research, 48(5), 973-1014.
12. Dhaliwal, D., Li, O. Z., Tsang, A., & Yang, Y. G. (2009). Voluntary non-financial disclosure and the cost of equity capital: the case of corporate social responsibility reporting. Working paper, University of Arizona and The Chinese University of Hong Kong.
13. Fama, E. F., & French, K. R. (2005). Financing decisions: Who issues stock? Journal of Financial Economics, 76(3), 549-582.
14. Francis, J., LaFond, R., Olsson, P., & Schipper, K. (2005). The market pricing of accruals quality. Journal of Accounting and Economics, 39(2), 295-327.
15. Francis, J., Nanda, D., & Olsson, P. (2008). Voluntary disclosure, earnings quality, and cost of capital. Journal of Accounting Research, 46(1), 53-99.
16. Friedman, M. (1970). The social responsibility of business is to increase its profits. New York Times Magazine, September 13.
17. Gao, Y. (2009). Corporate social performance in China: Evidence from large companies. Journal of Business Ethics, 89(1), 23-35.
18. Garber, S., & Hammitt, J. K. (1998). Risk premiums for environmental liability: Does superfund increase the cost of capital? Journal of Environmental Economics and Management, 36(3), 267-294.
19. Gebhardt, W. R., Lee, C. M. C., & Swaminathan, B. (2001). Toward an implied cost of capital. Journal of Accounting Research, 39(1), 135-176.
20. Godfrey, P. C. (2005). The relationship between corporate philanthropy and shareholder wealth: A risk management perspective. Academy of Management Review, 30(4), 777-798.
21. Goss, A., & Roberts, G. S. (2009). The impact of corporate social responsibility on the cost of bank loans. Working paper, Ryerson University and York University.
22. Lee, D. D., & Faff, R. W. (2009). Corporate sustainability performance and idiosyncratic risk: A global perspective. The Financial Review, 44(2), 213-237.
23. Lev, B., Petrovits, C., & Radhakrishnan, S. (2010). Is doing good for you? How corporate charitable contribution enhance revenue growth. Strategic Management Journal, 31(2), 182-200.
24. Li, W., & Zhang, R. (2010). Corporate social responsibility, ownership structure, and political interference: Evidence from China. Journal of Business Ethics, 96(4), 631-645.
25. Lin, J. Y., & Tan, G. (1999). Policy burdens, accountability, and the soft budget constraint. The American Economic Review, 89(2), 426-431.
26. Mackey, A., Mackey, T. B., & Barney, J. B. (2007). Corporate social responsibility and firm performance: Investor preferences and corporate strategies. Academy of Management Review, 32(3), 817-835.
27. Margolis, J. D., & Walsh, J. P. (2003). Misery loves companies: Rethinking social initiatives by business. Administrative Science Quarterly, 48(2), 268-305.
28. McGuire, J. B., Sundgren, A., & Schneeweis, T. (1988). Corporate social responsibility and firm financial performance. Academy of Management Journal, 31(4), 854-872.
29. Orlitzky, M., Schmidt, F. L., & Rynes, S. L. (2003). Corporate social and financial performance: A meta-analysis. Organization Science, 24(3), 403-441.
30. Peloza, J. (2006). Using corporate social responsibility as insurance for financial performance. California Management Review, 48(2), 52-72.
31. Porter, M. E., & Kramer, M. R. (2002). The competitive advantage of corporate philanthropy. Harvard Business Review, (December), 56-68.
32. Porter, M. E., & Linde, C. v. d. (1995). Green and competitive: Ending the stalemate. Harvard Business Review, (September-October), 120-135.
33. Richardson, A. J., & Welker, M. (2001). Social disclosure, financial disclosure and the cost of equity capital. Accounting, Organizations and Society, 26(7-8), 597-616.
34. Saiia, D. H., Carroll, A. B., & Buchholtz, A. K. (2003). Philanthropy as strategy: When corporate charity "Begins at Home". Business and Society, 42(2), 169-201.
35. Sharfman, M. P., & Fernando, C. S. (2008). Environmental risk management and the cost of capital. Strategic Management Journal, 29(6), 569-592.
36. Smith, C. (1994). The new corporate philanthropy. Harvard Business Review, (May-June), 105-115.
37. Spicer, B. H. (1978). Investors, corporate social performance and information disclosure: An empirical study. The Accounting Review, 53(1), 94-111.
38. Stinchcombe, A. L. (1965). Social structure and organizations. In J. G. March (Ed.), Handbook of organizations. Chicago: Rand-McNally.
39. Tian, L., & Estrin, S. (2007). Debt financing, soft budget constraints, and government ownership. Economics of Transition, 15(3), 461-481.
40. Tirole, J. (2006). The theory of corporate finance. Princeton: Princeton University Press.
41. Turker, D. (2009). How corporate social responsibility influences organizational commitment. Journal of Business Ethics, 89(2), 189-204.
42. Ullmann, A. A. (1985). Data in search of a theory: A critical examination of the relationships among social performance, social disclosure, and economic performance of U. S. firms. Academy of Management Review, 10(3), 540-557.
43. Vanhamme, J., & Grobben, B. (2009). Too good to be true! The effectiveness of CSR history in countering negative publicity. Journal of Business Ethics, 85(2), 273-283.
44. Wang, Q., Wong, T. J., & Xia, L. (2008). State ownership, institutional environment and auditor choice: Evidence from China. Journal of Accounting and Economics, 46(1), 112-134.
45. Wright, P., & Ferris, S. P. (1997). Agency conflict and corporate strategy: The effect of divestment on corporate value. Strategic Management Journal, 18(1), 77-83.
46. Zhang, R., & Rezaee, Z. (2009). Do credible firms perform better in emerging market? Evidence from China. Journal of Business Ethics, 90(2), 221-237.
47. Zhang, R., Rezaee, Z., & Zhu, J. (2010a). Corporate philanthropic disaster response and ownership type: Evidence from Chinese firms' response to the Sichuan earthquake. Journal of Business Ethics, 91(1), 51-63.
48. Zhang, R., Zhu, J., Yue, H., & Zhu, C. (2010b). Corporate philanthropic giving, advertising intensity, and industry competition level. Journal of Business Ethics, 94(1), 39-52.