Research On The Impact Of Product Harm Crisis On Related Events And Related Enterprise Performance

Product harm crisis have been happening all the time.The occurrence of product safety incidents in the food and pharmaceutical industry closely related to people will always attract widespread public attention and will bring great panic to relevant investors and the public.Food and medicine are closely related to people's health and may even affect consumers' lives.Products in the food and pharmaceutical industries have high requirements for production,storage and transportation.There are many reasons for the quality problems of enterprise products.It may be that the enterprises use poor raw materials for profit,and the equipment of the enterprise may not be closed.Moreover,after the product harm crisis,the affected enterprises are not only involved enterprises,but also the upstream and downstream enterprises and competing enterprises related to the enterprises involved.If the quality of products in the food and pharmaceutical industry is not critical,it will not only harm the health of consumers,but also affect the reputation and performance of the company.Since the impact of the product harm crisis on the company is so great,why do it happen frequently?The main reason is that the goal of business survival is to make a profit.Although some scholars have studied the food and pharmaceutical industries,they are more concerned with the negative effects of the product harm crisis from the perspective of consumers,or the research has positive or negative impact on competing companies.This paper is mainly based on related enterprises involved in the enterprise,including upstream and downstream enterprises and competitive enterprises,using stock prices to measure corporate performance,and also studies the impact of corporate social responsibility and advertising investment on corporate performance,and provides managers with ideas for crisis prevention.This paper collected product harm crisis events in the food and pharmaceutical industry from 2005 to 2017,and selected 38 representative events as research sample events.According to the screening criteria for short-term event research,81 involved companies were selected and 52 involved companies were used for short-term event research and long-term event research.The window period for short-term event studies is 2 days,and the window period for long-term event studies is 1 year.Through relevant empirical analysis,it is found that the product injury crisis will have a significant negative impact on the performance of the company involved(the excess return rate is negative and significant),and will be affected in a year,but over time,it will increase first and then decrease.In this paper,from 38 product injury incidents,81 enterprises involved,39 upstream enterprises,50 downstream enterprises and 87 competition enterprises were selected.The research found that the performance of upstream enterprises is basically not affected by the product injury crisis,downstream enterprises and competitive enterprise performance is significantly negatively affected;From the perspective of industry classification,the food industry and the pharmaceutical industry are all negatively affected,and the food industry is more affected than the pharmaceutical industry.After the product injury crisis,the impact of corporate social responsibility on the performance of the total sample enterprise is not significant,and the advertising investment has a significant negative impact on corporate performance.In summary,after the product harm crisis,this paper studies the impact of the performance of enterprises in the food and pharmaceutical industries,and the impact of multi-angle and multi-faceted research on the enterprises involved,upstream and downstream enterprises and competitive enterprises after the crisis.The paper studies the impact of corporate social responsibility and advertising investment on corporate performance.According to the conclusion,the company puts forward relevant suggestions for crisis events and negative impacts,and provides reference for the corresponding regulatory authorities.