Corporate Philanthropic Giving And Information Disclosure Violates

Nowadays,corporate social responsibility has become a kind of tide and trend.All over the world,the governments,some social organizations and companies actively discuss and practice corporate social responsibility.Although there are several aspects of corporate social responsibility(CSR),a lot of firms always use charitable donation as a substitutive form of their CSR.Plenty of studies have found and discussed the determinants of corporate philanthropy,including managers' characteristic,corporate governance,the strategies of company,institutional environment outside the firm and religious culture and so on.And the research of economic consequences of corporate philanthropic giving has attracted more and more attention.This paper mainly discusses the association between corporate philanthropic giving and information disclosure violations.Firstly,based on the theory of information asymmetry,accounting fraud motivation and principal-agent theory,this paper discusses the impact of corporate charitable donation on information disclosure violations.On the one hand,because corporate philanthropic giving will increase the transparency(Qian et al.2014)and reputation capital of the firm in the market,the company's information disclosure violations will become less;on the other hand,some research finds that the motivation of philanthropy may be managerial self-interest,so the more charitable donation,there are more information disclosure violations.Theoretically,the relationship between corporate philanthropy and information disclosure violations can be positive,or negative.Using the sample of Chinese private listed firms during 2005——2014 year,this study finds that the association between corporate philanthropic giving and information disclosure violations is negative.Secondly,this paper finds that some companies donate charitably every year,and some firms'donation is one-time.And the succession of corporate philanthropy attenuates the negative association between the amounts of corporate philanthropy and information disclosure violates.Thirdly,the empirical results show that the marketization of the province in which the companies locate attenuates the negative association between corporate philanthropy and information disclosure violates.Finally,this paper also does various sensitivity tests,and the results are robust.The above conclusions are still valid after using propensity score matching method and instrumental method to control for the potential endogeneity between corporate philanthropic giving and information disclosure violates.This paper may contribute to the existing literature in several ways:first,this paper finds that there is a negative association between corporate philanthropy and information disclosure violates.Second,the succession of charity attenuates the negative association between corporate philanthropy and information disclosure violates,suggesting that even if the smaller charitable donation the company does,the succession of philanthropy year by year can reduce information disclosure violates also.Third,this paper finds that there is a substitution effect in reducing firms' information disclosure violates.All above,this paper enriches the research of economic consequence of corporate philanthropy.