IDEAS home Printed from https://ideas.repec.org/a/eme/sampjp/sampj-05-2020-0158.html
   My bibliography  Save this article

Economic policy uncertainty and corporate social responsibility performance: evidence from China

Author

Listed:
  • Tianjiao Zhao
  • Xiang Xiao
  • Bingshi Zhang

Abstract

Purpose - The purpose of this paper is to show how the external issue of economic policy uncertainty (EPU) affects enterprises’ corporate social responsibility (CSR). Design/methodology/approach - This study investigates the relationship between EPU and CSR based on the Chinese capital market from 2010 to 2018. Following the most recent studies focused on economic policy uncertainty, this paper uses the news-based method proposed by Bakeret al.(2016) to measure EPU and explore the effect of EPU on CSR, as well as the mediating role of state ownership in such a relationship. Findings - Empirical results show that increasing EPU will restrain enterprises’ social responsibility behaviour and the inhibitory effect is more obvious for state-owned enterprises. Further analyses reveal that the inhibitory effect of EPU on CSR is stronger for enterprises that face severe financial constraints and is significant for various components of CSR, and trade policy uncertainty could also curb enterprises’ social responsibility behaviour. Practical implications - As a stable economic environment is important for enterprises’ CSR engagement, the present study’s conclusions can help policymakers better understand the implications of policy stability for enterprises’ financial and non-financial decisions and especially their CSR decisions. Social implications - With the increasing attention paid to the CSR of enterprises, this study provides evidence that enterprises should develop appropriate CSR strategies according to the economic policy environment and enhance their capacity to withstand the risks generated by EPU. Originality/value - To the best of the author’s knowledge, this study is the first to analyse the relationship between EPU and CSR. The results contribute to a better understanding of what issues influence enterprises’ CSR engagement, highlighting the importance of a stable economic policy environment and of enterprises’ ability to withstand risks.

Suggested Citation

  • Tianjiao Zhao & Xiang Xiao & Bingshi Zhang, 2021. "Economic policy uncertainty and corporate social responsibility performance: evidence from China," Sustainability Accounting, Management and Policy Journal, Emerald Group Publishing Limited, vol. 12(5), pages 1003-1026, January.
    • Handle: RePEc:eme:sampjp:sampj-05-2020-0158
    DOI: 10.1108/SAMPJ-05-2020-0158
    as

    Download full text from publisher

    File URL: https://www.emerald.com/insight/content/doi/10.1108/SAMPJ-05-2020-0158/full/html?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://www.emerald.com/insight/content/doi/10.1108/SAMPJ-05-2020-0158/full/pdf?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1108/SAMPJ-05-2020-0158?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gull, Ammar Ali & Ahsan, Tanveer & Qureshi, Muhammad Azeem & Mushtaq, Rizwan, 2023. "Striving to safeguard shareholders or maintain sustainability in periods of high uncertainty: A multi-country evidence," Technological Forecasting and Social Change, Elsevier, vol. 188(C).
    2. Peng, Daoju & Colak, Gonul & Shen, Jianfu, 2023. "Lean against the wind: The effect of policy uncertainty on a firm's corporate social responsibility strategy," Journal of Corporate Finance, Elsevier, vol. 79(C).
    3. Zhao, Tianjiao & Chan, Kam C., 2023. "Corporate social network and corporate social responsibility: A perspective of interlocking directorates," International Review of Financial Analysis, Elsevier, vol. 88(C).
    4. Guangyu Huang & Liqiong Shen, 2024. "The Bidirectional Relationship between Digital Transformation and Corporate Social Responsibility: A Legitimacy Perspective," Sustainability, MDPI, vol. 16(7), pages 1-21, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:sampjp:sampj-05-2020-0158. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Emerald Support (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.