Kindness is rewarded! The impact of corporate social responsibility on Chinese market reactions to the COVID-19 pandemic

Yuyang Yi; Zongyi Zhang; Youliang Yan

doi:10.1016/j.econlet.2021.110066

Kindness is rewarded! The impact of corporate social responsibility on Chinese market reactions to the COVID-19 pandemic

Econ Lett. 2021 Nov:208:110066. doi: 10.1016/j.econlet.2021.110066. Epub 2021 Sep 8.

Authors

Yuyang Yi¹, Zongyi Zhang¹, Youliang Yan¹

Affiliation

¹ School of Economics and Business Administration, Chongqing University, Chongqing, China.

Abstract

This study takes the COVID-19 outbreak as a quasi-natural experiment to investigate whether corporate social responsibility (CSR) performance can help firms mitigate drops in their share prices. The results show that CSR ratings are positively associated with cumulative abnormal return (CAR) during the COVID-19 outbreaks periods. Further, the positive role of CSR is more significant for non-state-owned enterprises (non-SOE) and those located in regions with lower levels of marketization.

Keywords: COVID-19; Corporate social responsibility; Cumulative abnormal return.