Affiliation:
1. School of Accounting Zhongnan University of Economics and Law Wuhan Hubei China
2. School of Accountancy Shanghai University of Finance and Economics Shanghai China
3. School of Accounting Southwestern University of Finance and Economics Chengdu Sichuan China
4. Research Center of Finance Shanghai Business School Shanghai China
Abstract
AbstractBy proxying ‘awe culture’ (i.e., reverence for life and ethical behaviour) with regional induced abortion rates, we examine the impact of awe culture on corporate social responsibility (CSR) in a sample of Chinese firms. We find that firms located in areas with higher induced abortion rates spend less funds on CSR activities and obtain lower CSR scores. The findings remain intact after an array of robustness tests. Further analysis shows that the effect of awe culture on CSR is more pronounced in areas with weaker law enforcement and where the local government emphasises economic growth targets. However, the effect becomes insignificant when firms are well‐represented by top executives with overseas experience, foreign directors, and a high proportion of female board members. The significance of the effect also diminishes for non‐state‐owned firms, and firms with higher institutional ownership and higher cash holdings. Moreover, the lack of awe culture attenuates the positive impact of CSR on firm value. Overall, we document that awe culture, as an informal institution, shapes CSR behaviours.
Funder
China Postdoctoral Science Foundation
National Natural Science Foundation of China
Shanghai University of Finance and Economics
Southwestern University of Finance and Economics
Subject
Economics, Econometrics and Finance (miscellaneous),Finance,Accounting
Cited by
3 articles.
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