Research On The Impact Of Charity Donations Of Private Listed Enterprises On Business Performance

In market-oriented economy,the first distribution is based on the efficiency of the market mechanism,and the second distribution is based on the principle of fairness and efficiency by the government through taxation and social security expenditures,and charity is an effective supplement to the above two distributions.As the third distribution,charity redeploy social wealth and social resources in accordance with the voluntary principle,which is conducive to narrowing the gap between rich and poor,alleviating social conflicts,and maintaining harmonious development.As an important force in China's national economy,private enterprises and their actual controllers have strong financial resources and the ability to participate in charity.According to the data of the China Charity Federation and the Hurun Charity List,in recent years,the actual controllers of private enterprises and private enterprises in our country have gradually played a leading role in charitable donations.Charitable donation behavior is located at the top of the corporate social responsibility pyramid.The actual controllers of private enterprises demonstrate their social responsibility through charitable donations,which will become a future trend.At the same time,the academia's discussion and research on the field of charitable donations has also been being a hit.After the 1980 s,the developed western countries gradually formed a mature corporate strategic charity model,and had a wealth of theoretical research results.Chinese scholars' research on the field of corporate charitable donations started later than the west.Since the Wenchuanearthquake in 2008,related research results have gradually emerged along with the social charity boom.However,the empirical research in the existing literature has not reached a unified conclusion on the correlation between charitable donations and corporate performance,and scholars at home and abroad have studied charitable donation behaviors at the corporate level mostly.While they have had less research related at the individual level of entrepreneurs or corporate actual controllers.As the ultimate controller of an enterprise,the actual controller of an enterprise plays a vital role in the operation and decision-making of the enterprise.In addition,the actual controller uses his company as a tool to maximize his own revenue.The actual controller usually has a close relationship with his company.Based on the above realistic background and research progress,this article conducts a study on the relationship between charitable donation behavior of the actual controllers of private listed companies and corporate financial performance.Based on the research results of relevant literature at home and abroad,this article puts forward two hypothesis: “the actual controller of private listed companies participating in charity donations is conducive to the improvement of corporate financial performance”,“The larger the actual controller of a private listed company's participation in charitable donations,the more conducive to the improvement of corporate financial performance”,by the elaboration and theoretical analysis of“stakeholder theory”,“strategic philanthropy theory”,and “corporate image reputation theory”.This article uses private listed company's actual controller charity donation data and related company financial data from 2010 to 2018,to empirically test the impact of private listed company's charity donation on the company's financial performance.The empirical results confirm the above two research hypotheses.From the above research,we find that the charitable donation behavior of the actual controller of a private listed company in China has a positive effect on its financial performance.Besides,there is a substitution relationship between the charitable donations of the actual controllers and the company's advertising expenditures and R & D investment.The actual controller of a private listed company can incorporate the charitable donation strategy into future business management,and achieve strategic economic charitable donations and social public welfare goals through strategic charitable donations,which requires not only the improvement of the ideology and morality and strategic decision-making level of the actual controllers of private listed companies,but also the creation of a social charity culturalatmosphere and the government's support in charity laws and tax policies.On the basis of this,China's enterprises and society can make great progress.