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Does voluntary adoption of clawback provisions improve corporate social responsibility: Evidence from China

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  • Zhou, Donghua
  • Yang, Liu
  • Zhao, Yujie

Abstract

Using manually collected data on the voluntary adoption of clawback provisions by China's listed companies, this study explores the impact of clawbacks on Corporate Social Responsibility (CSR). The results reveal that clawbacks significantly boost CSR by mitigating managerial short-termism and fostering risk-averse behavior. Additionally, the effect is more pronounced in non-environmentally or non-consumption-sensitive industries, and firms led by management with lower career stability or a less sense of responsibility. Our study represents a pioneering exploration of the beneficial effects of clawback provisions in China.

Suggested Citation

  • Zhou, Donghua & Yang, Liu & Zhao, Yujie, 2024. "Does voluntary adoption of clawback provisions improve corporate social responsibility: Evidence from China," Finance Research Letters, Elsevier, vol. 69(PB).
    • Handle: RePEc:eee:finlet:v:69:y:2024:i:pb:s1544612324012169
    DOI: 10.1016/j.frl.2024.106187
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    References listed on IDEAS

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