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Does managerial short-termism affect corporate social responsibility?

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  • Zhang, Cong
  • Teng, Wei
  • Liu, Zhaoqian

Abstract

This study examines how managerial short-termism affects corporate social responsibility (CSR) engagement among Chinese listed companies, revealing important contextual variations across regions, ownership structures, and industries. Using 23,253 firm-year observations from 2007 to 2022, this study examines the relationship between managerial myopia and CSR performance. Findings demonstrate that managerial short-termism negatively impacts CSR engagement, with corporate governance quality partially mediating this effect. The relationship exhibits distinct patterns. Eastern regions show heightened sensitivity compared with central and western regions; state-owned enterprises show greater vulnerability than non-state enterprises. Finally, polluting industries resist myopic effects while non-polluting ones show significant negative impacts. These heterogeneous effects underscore how institutional environments and organizational characteristics influence the relationship between managerial time horizons and social responsibility. Our findings advance understanding of CSR drivers in emerging markets and offer policymakers targeted insights for developing context-specific interventions to enhance corporate sustainability.

Suggested Citation

  • Zhang, Cong & Teng, Wei & Liu, Zhaoqian, 2025. "Does managerial short-termism affect corporate social responsibility?," Finance Research Letters, Elsevier, vol. 73(C).
    • Handle: RePEc:eee:finlet:v:73:y:2025:i:c:s1544612324016106
    DOI: 10.1016/j.frl.2024.106581
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    More about this item

    Keywords

    Managerial short-termism; Corporate social responsibility; Corporate governance; Chinese listed company; Textual analysis;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • P31 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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