Research On The Relationship Between Public Welfare Donation And Surplus Of Earnings

As a major form of social responsibility,corporate public welfare donations,along with the in-depth development of the market economy,have increasingly attracted the attention of the entire society.Through public welfare donations and corporate social responsibility,enterprises can achieve a win-win situation for both economic and social benefits.However,from the traditional financial point of view,public welfare donation is a dominant cost expenditure,which will transfer valuable resources of the enterprise and restrain the financial performance of the enterprise.Therefore,corporate public welfare donations have a double-sided nature.Public welfare donations have always been regarded as a dominant cost of the company without asking for returns.Is it intrinsically linked to the sustainability of corporate earnings?In order to explore whether the public welfare donation of enterprises and how to affect the sustainability of the company's earnings,this paper selects two companies with the same industry and similar scale of operation-LUTAI TEXTILE and BLUM ORIENTAL as the case analysis object.First,an in-depth study of the operating conditions,equity concentration and corporate governance structure of the two case companies was conducted to analyze the comparability of the two companies.Then,collect the financial data of LUTAI TEXTILE and BLUM ORIENTAL from 2011 to2017,and use the comparative analysis method to conduct a comparative analysis of the public welfare donations and earnings persistence of the two case companies,and compare them with the industry average.On this basis,the impact mechanism of public welfare donations and earnings persistence is analyzed from the perspective of corporate stakeholders.The results show that public welfare donations have a positive impact on the company's sustained high surplus,and companies with high earnings persistence show higher enthusiasm for public welfare donations.Finally,the corresponding recommendations were made for the results of the comparative analysis of the two case companies.The research in this paper provides useful suggestions and references for modern enterprises to build a mechanism of continuous earnings growth,a scientific decision-making mechanism for public welfare donations,and a coordination mechanism for building public welfare donations and surplus conflicts.