Study On The Effect Of Corporate Social Responsibility On Stock Price Crash Risk

As the report of the 19 th National Congress clearly put forward measures to encourage enterprises to assume corporate social responsibilities,corporate social responsibility has received more and more attention from all circles.And the performance of corporate social responsibility has become an important part of company management,whether the implementation of corporate social responsibility can lead to better investor recognition and market performance is the focus of all circles.In recent years,the phenomenon of "thousands of stocks falling" in China's A-share market has seriously hindered the healthy development of China's capital market.It's important to study the cause of stock price crash risk.As company's non-financial information,the corporate social responsibility can reflect more information about the company and decrease the degree of information asymmetry.However,the conclusions on the impact of corporate social responsibility on the risk of stock price crash have not yet been reached.Most scholars studied the impact of corporate social responsibility on the stock price crash risk from the perspective of management concealing bad news,and ignored the information transmission effect of corporate social responsibility on stakeholders.Therefore,this paper also explores the impact of corporate social responsibility on the stock price crash risk by combining the perspective of management to conceal bad news and the information perception of stakeholders.In addition,corporate social responsibilities in different dimensions,such as environmental responsibilities,stakeholder responsibilities,and social contributions responsibilities,maybe have different impacts on stock market crash risks.Using a dataset of listed companies in China from 2010 to 2017,this paper examined the impact and the transmission path of corporate social responsibility including environmental responsibility,stakeholder responsibility and social contributions responsibility on stock market performance which based on the principal-agent theory,stakeholders theory and information asymmetry theory.Further more,we studied the mechanism of the impact of corporate social responsibility on the stock price crash risk and verified whether the performance of corporate social responsibility would lead to better stock price performance.The results showed that:(1)The corporate social responsibility,especially stakeholder responsibility and environmental responsibility,has a significant negative relationship with stock price crash risk.(2)The Social contribution responsibility in the dimension of charitable donation has not significantly relationship with stock price crash risk.After adding a series of robustness tests such as control variables and instrument variable methods,the above conclusion is still true.(3)Further mechanism analysis finds that the effect is more pronounced in firms that with higher institutional ownership proportion especially long-term institutional investor.The firms with higher stakeholder responsibility score can also reduce the stock price crash risk through earnings management mechanism and analysts' attention mechanism.(4)The corporate social responsibility,especially stakeholder responsibility and environmental responsibility,is positively correlated with better stock market performance.In summary,through the analysis of the impact of different levels of corporate social responsibility,the research conclusions show that stakeholder responsibility and environmental responsibility performance can help reduce the stock price crash risk and get better stock market performance.,while the performance of charitable responsibility has not significant influence on the stock price crash risk.