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Political connection and corporate senior-care investment: Active investment or passive involvement?

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  • Meng, Bin
  • Lin, Zhipeng
  • Liu, Tao
  • Shi, Baofeng

Abstract

This study investigates the impact of political connections on the willingness of Chinese listed companies to invest in senior care using data collected between 2019 and 2021, contextualized within China's rapid transition to an “aged” and “super-aged” society. Utilizing empirical data, this research explores how political ties, media attention, and the nature of enterprise ownership influence corporate investment behaviors in the senior-care sector. Key findings indicate that political connections positively correlate with increased investment, driven by both proactive alignment with government policies and reactive compliance under government pressure. Conversely, heightened media scrutiny can dampen investment willingness, possibly due to reputational concerns. Furthermore, state-owned enterprises exhibit a stronger propensity toward senior-care investment compared with private firms. This analysis highlights the complex interplay between corporate governance, social responsibilities, and external influences, suggesting that both policymakers and companies must consider these dynamics to foster meaningful contributions to the senior-care sector. These results enhance the understanding of corporate behavior in the face of demographic challenges while contributing to the broader discourse on corporate social responsibility.

Suggested Citation

  • Meng, Bin & Lin, Zhipeng & Liu, Tao & Shi, Baofeng, 2024. "Political connection and corporate senior-care investment: Active investment or passive involvement?," Finance Research Letters, Elsevier, vol. 67(PA).
    • Handle: RePEc:eee:finlet:v:67:y:2024:i:pa:s1544612324007724
    DOI: 10.1016/j.frl.2024.105742
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    More about this item

    Keywords

    Corporate senior-care investment; Political connection; Corporate social responsibility; Media attention;
    All these keywords.

    JEL classification:

    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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