The Research On The Correlation Between Corporate Social Responsibility And The Cost Of Capital Of Listed Food Company

Food industry is the important pillar of national economy.In 2015,food industry output value has reached 11.34 trillion.On one hand,food industry is closely related to the life and health of public,social responsibility is of great significance.But in recent years,the food safety problems have happened frequently.There is no doubt that the current situation of social responsibility is serious.Thus,companies should undertake social responsibility and disclose social responsibility information in time,it is the only way for food companies to develop sustainably.On the other hand,as a traditional industry,food industry has a serious financing problem for a long time,while,the financing plan has a very large space.So,study of the cost of capital in food industry is an inevitable choice.Based on China's food industry listed companies as samples,this paper study whether its social responsibility affect the cost of capital,providing theoretical support and empirical data for food enterprises to improve social responsibility and reduce the cost of capital.From the perspective of characteristics and present situation of listed food companies' social responsibility in our country,this paper selects food industry A-share listed companies in China as samples,using five years data from 2011 to 2015.This paper treats the cost of debt capital and the cost of equity capital as the explained variables firstly,puts the responsibility contribution ratio of state,supplier,employee,investor,consumer,community and food quality management disclosure as explained variables,regards market process index and legal environment as adjust variables and over-investment as intervening variable.the main purpose of this paper is to study whether corporate social responsibility of the food industry could reduce the cost of capital,and what the mechanism of this action between them.Results are as follows:(1)the corporate social responsibility performancecan indeed reduce the cost of capital,corporate social responsibility has negative relationship with the cost of equity capital and the cost of debt capital,but assuming social responsibility to different stakeholders could have different influence on the cost of equity capital and the cost of debt capital.To be specific,liable for state,employees,investors,consumers,enterprises can significantly reduce the cost of equity capital and the cost of debt capital,but assuming community responsibility and food safety responsibility only has significant effect on the cost of equity capital,taking on supplier responsibility only can reduce the cost of debt capital effectively.(2)over-investment is the important influence path for corporate social responsibility to reduce the cost of capital.After joining over-investment variable,most of the explanatory variables have lost their original significance,meanwhile,over-investment has a significant negative correlation with the cost of capital.Consequently,over-investment is intermediary variable of corporate social responsibility and the cost of capital.(3)Corporate social responsibility plays an important role of reducing the cost of capital,the process of marketization and the legal environment will influence this function.After joining marketization index and legal environment in the model respectively,this paper finds that they have significant negative correlation with the cost of capital,thus they are corporate social responsibility and the cost of capital.Based on this,this article put forward that: to reduce the cost of capital,promoting corporate social responsibility is the important path for the food industry to choose.Enterprises should actively take all kinds of social responsibility,at the same time,the food industry should especially pay attention to food quality management and strengthen the monitoring of products.Meanwhile,improving the marketization process and legal environment is an important task for our country at this stage.