Market Effect Of IPO Corporate Social Responsibility Information Disclosure

After years of rapid economic growth,China has to face the problems caused by economic development.Such phenomena as environmental damages caused by the short-term behavior of enterprises have become serious social problems.So the corporate social responsibility(CSR)is becoming a focus of attention.Some researchers have analyzed the issue of CSR of Chinese listed companies by examining their annual reports.Nevertheless,the CSR situation of IPO firms has got very little exploration.This paper adopted a content analysis approach to study the IPO prospectuses which disclosed information of CSR,and examined the relationship between the CSR information and its post-IPO market effect.We selected the prospectuses of 1238 IPO firms listed on Shanghai Stock Exchange and Shenzhen Stock Exchange from 2010 to 2016.By content analysis of the prospectuses,we got text information indices of the corporate social performance(CSP)and the corporate environmental performance(CEP)of the sample firms.First,this paper conducts an empirical analysis of the sample population.Second,in order to do comparative research on companies with different disclosure characteristics,we have divided the samples into four groups and conducted empirical analysis on samples from different groups.The empirical analysis shows that there is a significant relationship between the CSP and the corporate social information text introduction index(CSP_texi)and the holding period return(HPR)and cumulative excess return(CAR)on the 30 th day after the initial public offering.There was no significant relationship between CEP and HPR or CAR.In the sample grouping,there was no significant relationship between the CSP and CEP of the“Company that disclosed external donations and environmental protection expenditures”group and the “Company that only disclosed environmental protection expenditures”group and HPR and CAR;In the “Disclosed Corporate” group,both CSP and CSP_texi are positively correlated with HPR,but only have a significant level of 10%.There is still no significant relationship between CEP and HPR.Both CSP and CEP were positively correlated with CAR.In the group of “companies that only disclosed external donations”,the CSP and corporate social information fund expenditure index(CSP_cii)were significantly negatively correlated with HPR and CAR,and there was no significant relationship between CEP and HPR and CAR.This shows that the text of the introduction of corporate social responsibility information has a positive impact on stock returns,and corporate social responsibility expenditure information has a negative impact on stock returns,but the impact is low.The impact of further research on institutional investors shows that in the sample population,only the corporate environmental information text index(CEP_texi)is significantly related to the shareholding of institutional investors.In the sample grouping,there was no significant relationship between the CSP or CEP of the group of “companies that disclosed both external donations and environmental protection expenditures” and the group of “companies that only disclosed external donations”,and the shares held by the organization.In the group of “companies that did not disclose external donations and environmental protection expenditures” and the group of “companies that only disclose environmental protection expenditures”,the impact of CEP and CEP_texi on the proportion of shares held by institutional investors became significant.This may mean that institutional investors are more pay attention to environmental information.