Corporate philanthropy and corporate social irresponsibility during the COVID-19 pandemic: evidence from China

Abstract

Purpose

This study aims to investigate the perspective of corporate philanthropy during the coronavirus disease 2019 (COVID-19) in China for firms with various levels of corporate social responsibility (CSR). Specifically, the study appraises the impact of the COVID-19 pandemic on the stock returns and sustainable development of Chinese-listed companies and determines the likelihood of paying donations vis-à-vis firm reputation.

Design/methodology/approach

The study used data from 117 Chinese-listed firms engaged in philanthropy during the COVID-19 pandemic. The authors also utilized the stock returns and cash donation data, and owing to the cross-sectional data and continuous nature of dependent variables, they employed the ordinary least squares regression to test the research hypotheses.

Findings

The results show that irresponsible actions have a positive relationship with donations. The study particularly reveals that irresponsible firms have significant negative abnormal returns during the first wave of the COVID-19 pandemic.

Originality/value

To the best of our knowledge, this is the first empirical study to explore the perspective of corporate philanthropy during the COVID-19 pandemic for companies with different CSR levels. This study contributes to the empirical research on CSR and provides insights for managerial-cum-financial decisions to encourage managers of irresponsible firms to pursue philanthropic behaviors after crisis events.

Citation

Ishfaq Ahmad, M., Cepel, M., Battisti, E. and Ur Rehman, R. (2023), "Corporate philanthropy and corporate social irresponsibility during the COVID-19 pandemic: evidence from China", International Journal of Emerging Markets, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/IJOEM-08-2022-1310