Are Corporate Social Responsibility Active Firms Less Involved in Earnings Management? Empirical Evidence From China

Pasko, Oleh; Chen, Fuli; Проскуріна, Н. М.; Mao, Rong; Gryn, Viktoriia; Pushkar, Iryna

doi:10.3846/btp.2021.14940

Cited by 12 publications

(7 citation statements)

References 43 publications

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“…It is argued that highly competent managers may prioritize short-term financial goals over long-term CSR objectives (Hmaittane et al, 2022;Pasko, Chen, et al, 2021). This myopic focus on immediate financial gains may hinder the development of robust and sustained CSR practices (H. Pasko, Zhang, et al, 2021).…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Does managerial ability matter in corporate sustainability-related dynamics? An empirical investigation

Pasko,

Zhang,

Markwei Martey

et al. 2024

Problems and Perspectives in Management

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This study aims to assess the intricate interplays between managerial ability, corporate social responsibility (CSR), and firm value, focusing on 3,498 company-year observations sourced from the RANKINS CSR RATINGS and China Stock Market &amp; Accounting Research (CSMAR) databases representing China’s Shanghai and Shenzhen A-share listed companies from 2009 to 2018. Employing a rigorous sample selection process and utilizing data from reliable databases, the research employs a comprehensive methodology to explore the intricate corporate sustainability-related dynamics influencing organizational success and societal impact.The findings reveal a compelling negative correlation between managerial ability and CSR performance, corroborating previous research and suggesting potential challenges in reconciling managerial competence with social responsibility priorities. Furthermore, this paper establishes a negative correlation between CSR and firm value, with managerial ability influencing the magnitude of this impact, underscoring the significance of managerial skills in moderating the relationship between CSR initiatives and overall corporate performance. Moreover, the study uncovers a robust positive correlation between managerial ability and firm value, emphasizing the pivotal role of adept leadership in achieving higher corporate valuation. It provides valuable insights for practitioners, policymakers, and scholars, creating a conducive environment for well-informed decision-making. In the ever-changing corporate landscape, a deep understanding of these interconnections is essential to nurture business practices that are both sustainable and value-oriented. AcknowledgmentThis paper is co-funded by the European Union through the European Education and Culture Executive Agency (EACEA) within the project “Embracing EU corporate social responsibility: challenges and opportunities of business-society bonds transformation in Ukraine” – 101094100 — EECORE – ERASMUS-JMO-2022-HEI-TCH-RSCH-UA-IBA/ERASMUS-JMO-2022-HEI-TCHRSCH https://eecore.snau.edu.ua/Oleh PASKO expresses sincere gratitude for the support from the Kirkland Research Program, generously provided by the Leaders of Change Foundation established by the Polish-American Freedom Foundation.

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Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Does managerial ability matter in corporate sustainability-related dynamics? An empirical investigation

Pasko,

Zhang,

Markwei Martey

et al. 2024

Problems and Perspectives in Management

Self Cite

View full text Add to dashboard Cite

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“…Agency theory explains that the information asymmetry between managers and stakeholders is high. So that with the existence of information asymmetry, it will further increase the opportunity for managers to practice EM (Pasko et al, 2021).…”

Section: Literature Review and Hypothesis Development 1theoretical Basismentioning

confidence: 99%

The Effect Analysis of Earning Management and Family Control on the Z-Score Model of Financial Distress Prediction

Haji-Seseang,

Habbe,

Rasyid

et al. 2023

Business: Theory and Practice

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The validity of the use of financial statements as a source of information for detecting financial distress is questionable because of the opportunistic behaviour of the company’s management. This study aims to analyse the effect of accrual earnings management, real earnings management, and family control on the Z-score financial distress prediction. Using the sample that includes 372 firm years of observations for the 2017 to 2019 periods listed on the Indonesia Stock Exchange, this study found that accrual earnings management, real earnings management, and family control variables affect the Z-score financial distress prediction and cause a higher probability for the company to be in the category of better financial condition. The novelty of this study lies in earnings management and family control as factors that affect the category of assessment and the probability of assessing the company’s financial condition as a better company. Empirical evidence from this study is important for investors and company creditors, as input to consider these factors in using the company’s financial distress prediction model. For standard setters, the results of this study can be used as input for establishing corporate governance design rules to improve the quality of financial information.

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“…Corporate Social Responsibility (CSR) has emerged as a pivotal concept within the domain of corporate governance, reflecting a trajectory of growing significance and origination (Pucheta-Martínez & Gallego-Álvarez, 2018). The disclosure of CSR practices serves as a mechanism for companies to communicate their social initiatives to diverse stakeholders, concurrently identifying societal priorities (Hussain et al, 2018;Pasko, Chen, Proskurina, et al, 2021;Searcy & Buslovich, 2014). In tandem, the efficacy of corporate governance structures hinges not only on facilitating the harmonious coordination of stakeholder interests but also on establishing an advanced mechanism for CSR disclosures, ensuring veracious, qualitative, relevant, and reliable reporting (Al Fadli et al, 2022).…”

Section: Introductionmentioning

confidence: 99%

Is corporate governance a significant factor in corporate social responsibility disclosure? Insights from China

Pasko,

Kharchenko,

Kovalenko

et al. 2024

Investment Management and Financial Innovations

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This comprehensive study delves into the intricate relationship between corporate governance and Corporate Social Responsibility Disclosure (CSRD) within the framework of China’s institutional landscape. By analyzing an extensive dataset comprising 35,435 firm-year observations from 3,889 A-share listed companies spanning the years 2006 to 2019, the research scrutinizes various governance mechanisms, including board size, independence, CEO duality, and ownership concentration.The investigation affirms that larger boards and a higher proportion of independent directors exert a positive influence on CSRD. In contrast, a substantial shareholding ratio held by the largest shareholder proves to be a hindrance to the transparent disclosure of CSR initiatives. While the impact of CEO duality on CSRD is noted, the statistical significance of this relationship remains inconclusive.These findings underscore the nuanced dynamics of governance and ownership structures in shaping CSR initiatives. The findings highlight the nuanced impact of governance and ownership structures on CSR initiatives, offering valuable insights for managers and policymakers navigating CSR strategies in China’s business landscape. The insights garnered from this study hold valuable implications for both corporate managers and policymakers navigating the landscape of CSR strategies within the unique contours of China’s business environment. AcknowledgmentThis paper is co-funded by the European Union through the European Education and Culture Executive Agency (EACEA) within the project “Embracing EU corporate social responsibility: challenges and opportunities of business-society bonds transformation in Ukraine” – 101094100 – EECORE – ERASMUS-JMO-2022-HEI-TCH-RSCH-UA-IBA / ERASMUS-JMO-2022-HEI-TCHRSCH https://eecore.snau.edu.ua/Oleh PASKO expresses sincere gratitude for the support received from the Kirkland Research Program, generously provided by the Leaders of Change Foundation established by the Polish-American Freedom Foundation.

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Are Corporate Social Responsibility Active Firms Less Involved in Earnings Management? Empirical Evidence From China

Cited by 12 publications

References 43 publications

Does managerial ability matter in corporate sustainability-related dynamics? An empirical investigation

Does managerial ability matter in corporate sustainability-related dynamics? An empirical investigation

The Effect Analysis of Earning Management and Family Control on the Z-Score Model of Financial Distress Prediction

Is corporate governance a significant factor in corporate social responsibility disclosure? Insights from China

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