A Study On The Effectiveness Of Corporate Social Responsibility Promoting Financial Performance

In the current circumstance of institutional system, people usually assume that state-owned enterprises (SOE) should take more corporate social responsibilities (CSR) than private enterprises, for social goal is as important as economic goal in SOE in our nation because of their Public ownership, not only they have to guarantee the development of our nation, but also they must accept CSR. However, private enterprise is different. Has financial performance been decreased by escaping CSR for SOE? Has financial performance been promoted by accepting CSR for private enterprises? In theory, taking CSR is a kind of active which is helpful to improve the ability of sustainable development for enterprises. In practice, refusing to accept CSR is nothing new for SOE, and private enterprises are always irresponsible for their stakeholder. If CSR can promote financial performance effectively, why there is so much irresponsible behavior?Miscellaneous enterprises is the point of penetration, the author adopted empirical approach to study the effectiveness of CSR promoting financial performance, and which factors are more effective. The conclusions of the paper will be reference to the CSR policy and practice.The paper is mainly constituted by four sections.Chapter I introduces the research background and the significance of the paper, and expatiates on the content and frame.Chapter II is concluded by theories and Review of relevant researches. The relevant theories include: Stakeholder Theory, Social Contract Theory, Iron Law of Responsibility theory, harmonious society and CSR, the concept of scientific development and CSR. The study of CSR is mature in the west countries, but it is start-up in China. The paper looks back the relevant overseas research findings, and then summarize the internal research.Chapter III is Empirical Study, analyzing the effectiveness of CSR promoting financial performance. Different enterprise categories are considered in the paper. This part is the core of this paper. First of all, the author designed an index of CSR, and then chose samples, collected data,designed econometric model, and proposed two hypothesis: (1) SOE have taken more CSR than private enterprises; (2) CSR can promote financial performance in SOE; (3) CSR can promote financial performance in private enterprise. The conclusion shows that: (1) SOE took more CSR than private enterprises based on comparing the absolute amount; (2) the rate of contribution to public of SOE is less than the rate of private enterprises;(3) SOE taking CSR could promote financial performance in three aspects;(4) private enterprises taking CSR could promote financial performance in two aspects. At last, the author discussed the conclusion.In Chapter IV, the paper sums up conclusions and proposes suggestions concerning the relevant policy. After a further summary of the empirical study, the author proposes some policy advisements about how to promote the enterprises to perform CSR and coordinate the economic goal and the social goal.Conclusions of the paper sums up the innovations and the limits of relevant researches.There are two innovations in the paper. First innovation is the study perspective, the paper is the combination of CSR theory and Chinese practical economic situation, analyzing the listed companies which are different in nature, covering the shortage of studies which are only about certain enterprise theoretically. Second innovation is the conclusion: the contribution to public could not drive financial performance both in SOE and private enterprises; private enterprises disobeying the regulations did not affect financial performance. these conclusions indicate the importance of building positive donation institutional environments and improving the legal system of CSR.