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Do CSR awards enhance firms’ market value? Evidence from China

Min Zhang (College of Management and Economics, Tianjin University, Tianjin, China)
Ruixi Long (College of Management and Economics, Tianjin University, Tianjin, China)
Qingmei Tan (College of Management and Economics, Tianjin University, Tianjin, China)
Keke Wei (College of Management and Economics, Tianjin University, Tianjin, China)

Chinese Management Studies

ISSN: 1750-614X

Article publication date: 25 November 2022

Issue publication date: 24 November 2023

278

Abstract

Purpose

This study aims to examine the impact of corporate social responsibility (CSR) awards on firms’ market value considering these awards as a signal and proxy for the effectiveness of CSR practice.

Design/methodology/approach

There are 342 announcements of CSR awards in China from 2006 to 2017 screened and analyzed using the event study methodology.

Findings

The stock market reacts significantly negatively to CSR award announcements in the short term. Firms that are state-owned, belong to the manufacturing industry, outside east China, repeatedly win awards and are listed in the Chinese H-share market, experience a stronger stock market reaction. Interestingly, the long-term stock returns of award winners are significantly positive for multiyear holding periods.

Practical implications

The findings offer stakeholders clear guidelines on how to manage communications in the market to extract enhanced financial performance from CSR award announcements.

Originality/value

This study chooses CSR awards as a proxy for the effectiveness of excellent CSR practice. This study also contributes to the CSR literature by analyzing how investors use the award information to make investment decisions.

Keywords

Acknowledgements

This research is supported by National Social Science Fund of China (No. 20BGL093).

Funding: The authors received financial support from National Social Science Fund of China (No. 20BGL093).

Declaration of conflicting interests: The authors declared no potential conflicts of interest with respect to the research, authorship and/or publication of this paper.

Citation

Zhang, M., Long, R., Tan, Q. and Wei, K. (2023), "Do CSR awards enhance firms’ market value? Evidence from China", Chinese Management Studies, Vol. 17 No. 6, pp. 1302-1317. https://doi.org/10.1108/CMS-07-2022-0234

Publisher

:

Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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