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Journal of Business Ethics

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01.08.2014

Religion, the Nature of Ultimate Owner, and Corporate Philanthropic Giving: Evidence from China

verfasst von: Xingqiang Du, Wei Jian, Yingjie Du, Wentao Feng, Quan Zeng

Erschienen in: Journal of Business Ethics | Ausgabe 2/2014

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Abstract

Using a sample of Chinese listed firms for the period of 2004–2010, this study examines the impact of religion on corporate philanthropic giving. Based on hand-collected data of religion and corporate philanthropic giving, we provide strong and robust evidence that religion is significantly positively associated with Chinese listed firms’ philanthropic giving. This finding is consistent with the view that religiosity has remarkable effects on individual thinking and behavior, and can serve as social norms to influence corporate philanthropy. Moreover, religion and corporate philanthropic giving have a significantly weaker (less pronounced) positive association for state-owned enterprises than for non-state-owned enterprises. The results are robust to a variety of sensitivity tests. Our results highlight religious influence on corporate philanthropic giving in contemporary China, an old traditional country with a typical communist economy.

Vorheriger Artikel Are Workers More Likely to be Deviant than Managers? A Cross-National Analysis

Nächster Artikel Challengers from Within Economic Institutions: A Second-Class Social Movement? A Response to Déjean, Giamporcaro, Gond, Leca and Penalva-Icher’s Comment on French SRI

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Famous religious sites attract travelers. For example, Buddhist meditation has inspired meditation tourism in Thailand, Hong Kong, and Japan, attracting many to monasteries in their quests for self-realization and spiritual enlightenment. Religious tourism positively affects religious loyalty, drawing even non-adherents. In other words, religious tourism promotes religious teachings and attracts the general public.

Hilary and Hui (2009) also provide strong evidence that firms located in counties with higher religiosity display lower risk exposure. Dyreng et al. (2012), Grullon et al. (2010), and McGuire et al. (2012) also show the impact of religion on accounting risks, lawsuits, restatements, and accrual management. McGuire et al. (2012) note that religious social norms are important for mitigating agency conflicts in contemporary corporations.

Monks or clergies cannot derive accurate statistics about the numbers of religious believers in their assemblies because so many attend services. More importantly, many religious people are conservative and discreet. Persecution during the Cultural Revolution made them feel unsafe about communicating their religious beliefs publically. Therefore statistics are unavailable to reveal the number of religious believers.

We choose 200 and 300 km as the distance criteria to calculate the number of religious sites famous nationwide and measure religious variables for the following reasons: (1) Following Du (2012) and Rising (2000), we view every province or municipality as approximately circular and calculate the average approximate radius to be about 234.05 km. (2) “Higher index of ‘standard deviation/mean’ indicates acuter relative discrete degree of random variables on the mean, and thereof it is more unsuitable to choose related distances as the criteria to define religious variables” (Du 2012). Therefore, we calculate the index of “standard deviation/mean” and find it greater than 1 when the distance criterion exceeds 200 km. Therefore, we choose 200 and 300 km as the distance criteria.

Our main conclusions are not qualitatively changed using other measures of GIVING as the dependent variable.

We omit firms located in five autonomous regions (Xinjiang, Tiebt, Inner Mongolia, Guangxi, and Ningxia) because the temples listed are in the Han area. We also eliminate firm-year observations in Gansu, Hainan, and Qinghai because these provinces have no nationally famous religious sites. If we view those regions and provinces as having low religiosity and include them in our sample, the results are not qualitatively changed.

The results remain qualitatively similar if we include firm-year observations based on criteria (2)–(4) and introduce three dummy variables (i.e., ST, Negative assets, and CROSS) into regressions.

The results are not qualitatively changed by deleting the top and the bottom 1% of the sample, no deletion, or no winsorization.

Following Shapiro and Wilk (1965), Shapiro and Francia (1972), and D’Agostino et al. (1990), we conduct three tests to examine whether corporate philanthropic giving in our sample obeys the standard normal distribution, respectively. Our results show that the null hypothesis that “corporate philanthropic giving in our sample obeys standard normal distribution” is rejected at the 1% level regardless of used test approaches (z = 19.38, z = 2.76, and χ ² = 5317.66 for Shapiro–Wilk test, Shapiro–Francia test, and Skewness–Kurtosis test, respectively).

We also conduct two other robustness checks: (1) GIVING is measured as the amount of corporate philanthropic giving, the natural logarithm of the amount of corporate philanthropic giving (Zhang et al. 2009); and (2) GIVING is measured as the amount of corporate philanthropic giving deflated by sale revenue (Williams 2003; Chen et al. 2008). Our unreported results are qualitatively similar to those in Table 4.

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Titel: Religion, the Nature of Ultimate Owner, and Corporate Philanthropic Giving: Evidence from China
verfasst von: Xingqiang Du
Wei Jian
Yingjie Du
Wentao Feng
Quan Zeng
Publikationsdatum: 01.08.2014
Verlag: Springer Netherlands
Erschienen in: Journal of Business Ethics / Ausgabe 2/2014
Print ISSN: 0167-4544
Elektronische ISSN: 1573-0697
DOI: https://doi.org/10.1007/s10551-013-1804-1

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