Creating value through corporate social responsibility: The role of foreign institutional investors in Chinese listed firms
研究外国机构投资者如何影响中国企业社会责任与公司价值的关系，发现外资持股能增强CSR的价值提升作用，尤其对非国企、客户意识强、有外国董事和频繁实地考察的公司更显著。
This study examines the interplay between two major global trends—the growing role of foreign institutional ownership (FIO) due to financial liberalization and the rise of corporate social responsibility (CSR) as an investment ethos. We choose the setting of China, the world’s second-largest economy that has recently experienced substantial growth in foreign portfolio investment and increased its commitment to CSR . We document that CSR performance significantly influences the portfolio allocation decisions of certain types of FIO. Crucially, our analysis reveals that firms with a higher level of ownership by foreign institutional investors are associated with a more positive relation between CSR performance and firm value. This finding is robust to endogeneity examinations, including quasi-natural experiments and instrumental variable estimations. The finding is stronger for non-state-owned enterprises, firms with higher customer awareness, firms with more foreign directors, and firms with more frequent corporate site visits from FIO. Monitoring and advising are two likely channels through which FIO enhance the CSR-value relation. Finally, we demonstrate that FIO enhance firms’ ability to harness the power of CSR as a driver of innovation.