Firm ownership and corporate social responsibility in China: from a multiple stakeholder perspective

This chapter provides a distinct look at a firm’s decision related to its prioritization of different stakeholder orientation and associated interests based on different ownership types. For the firm of different ownerships that we investigate, namely, SOEs, POEs and FOEs, we identify five key stakeholders and evaluate the stakeholder orientation with financial and operational indicators. We then use a hierarchical regression model to analyse 1 , 580 listed firms on the Chinese market and discuss the impact of ownership on the five stakeholder orientations. We further correlate firms’ decisions regarding stakeholder interests to the context of a possible trade-off scenario and obtain confirmative results that firms do choose differently between two potentially conflicting interests, implied by different stakeholder orientations. Our findings suggest that, among the three types of firms, POEs are more likely to attend to societal orientation, FOEs are more likely to attend to investor orientation, consumer orientation and environmental orientation. A weak difference is detected in employee orientations across different types of firms. In a context of potential conflicting interest, our results suggest that different types of ownership leads to different choices in trading off different stakeholder interests, with FOEs trading off between employee and social interests, SOEs trading off customer interests with social interests, and all firms trading off customer interests with environment interests.

In what follows we will discuss some basic theory on CSR and stakeholders and provide previous literatures that relate stakeholder interests to CSR, upon which we establish our hypotheses. Empirical model analysis and results are presented following the theoretical discussions. Then we discuss the findings and conclude.