Research On The Economic Consequences Of Listed Companies’ Participation In Targeted Poverty Alleviation

Difficult and expensive financing issues exist widely in the capital market.As a way to help companies obtain external resources from stakeholders,the performance of listed companies’ social responsibility is an informal mechanism to solve financing problems in the capital market and a way to promote the rationalization of capital market resource allocation.Although there is not much related research on social responsibility performance of targeted poverty alleviation in China,with the promotion of the concept of "Targeted Poverty Alleviation" in China,it has been highly valued by government in recent years.Since the concept of "Targeted Poverty Alleviation" was put forward in 2013,people from all walks of life have gradually paid attention to it.The "Decision of the Central Committee of the Communist Party of China and the State Council on Winning the Fight against Poverty" released at the end of 2015 also made overall arrangements for China’s current fight against poverty.The China Securities Regulatory Commission’s“Opinions of the China Securities Regulatory Commission on the Role of Capital Market in Serving the Country in Poverty Alleviation” issued in2016 encouraged listed companies to actively participate in targeted poverty alleviation,and supported enterprises in povertystricken areas to use capital market resources and improve financing efficiency.In the context of targeted poverty alleviation,listed companies’ performance of targeted social responsibility not only has the characteristics of general social responsibility performance,but has different characteristics from other social responsibilities.It is mainly manifested in the annual limits of targeted poverty alleviation,diversity of targeted poverty alleviation methods or projects,the disclosure characteristics of information for poverty alleviation,etc.,so it has certain special characteristics.However,whether the social responsibility of targeted poverty alleviation of listed companies can bring certain corporate benefits or economic consequences,whether it can provide a reference basis for capital market resources allocation and affect the company’s own financing costs still remain to be explored.This article first reviews and sorts out existing researches on the economic consequences of social responsibility,corporate poverty alleviation,and the cost of capital,and points out the shortcomings of the existing researches.Based on this,the research objectives,methods,contents and overall thinking of this paper are further clarified.Secondly,the concepts of social responsibility,targeted poverty alleviation and the cost of capital are defined,and the importance of fulfilling the social responsibility of targeted poverty alleviation of listed companies is explained theoretically using resource-based theory,stakeholder theory and political cost theory.Thirdly,from the perspective of the number of listed companies participating in targeted poverty alleviation and the amount of investment in targeted poverty alleviation,etc.,the current status of listed companies’ fulfillment of social responsibility for targeted poverty alleviation from 2013 to 2018 is described.Subsequently,the design of the study is described in terms of the cost of capital.Finally,in order to verify the research hypothesis,the impact of the performance of corporate targeted poverty alleviation on the cost of capital was tested from the perspective of both the cost of equity capital and the cost of debt capital.The empirical results show that,compared with enterprises that have not fulfilled their social responsibilities for targeted poverty alleviation,enterprises which engage in poverty alleviation social responsibility have significantly reduced the cost of equity capital and the cost of debt capital.Further analysis find that the reduction effect is significantly different under the influence of different property rights,geographic area,mandatory disclosure and different scales.Through mechanism analysis,it is found that institutional investors’ shareholding plays a partial mediating role in reducing the cost of equity capital and information quality plays a partial mediating role in reducing the cost of debt capital.In addition,based on the analysis results,it is proposed to further guide listed companies to actively participate in targeted poverty alleviation actions,improve the efficiency of resource allocation in the capital market,and fully understand the significant differences in the performance of social responsibilities of enterprises with different characteristics,and guide investors and creditors to focus on enterprises’ daily experience and activities.This provides a reference for the ongoing fight against poverty in China from the capital market.