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Analyst coverage and corporate social performance: Evidence from China

Author

Listed:
  • Zhang, Min
  • Tong, Lijing
  • Su, Jun
  • Cui, Zhipeng

Abstract

This paper uses a set of unique data from Chinese listed companies to examine the influence of analyst coverage on corporate philanthropy. Results show that companies followed by more analysts engage in more philanthropy, which provides support for the reputational capital view of corporate philanthropy. The effect of analyst coverage on philanthropy is more pronounced for nonstate-owned enterprises (non-SOEs) than for state-owned enterprises (SOEs). Using the number of analysts following the firm and media coverage as alternative measures, distinguishing star analysts and ordinary analysts and applying the change model and 2SLS model with merge of brokerage houses as the instrumental variable, we confirm the robustness of the conclusions. Our research enriches the literature on corporate social responsibility and analyst coverage.

Suggested Citation

  • Zhang, Min & Tong, Lijing & Su, Jun & Cui, Zhipeng, 2015. "Analyst coverage and corporate social performance: Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 32(C), pages 76-94.
    • Handle: RePEc:eee:pacfin:v:32:y:2015:i:c:p:76-94
    DOI: 10.1016/j.pacfin.2015.02.005
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    More about this item

    Keywords

    Corporate philanthropy; Analyst coverage; Media coverage; Corporate social responsibility; Star analyst; Merge of brokerage houses;
    All these keywords.

    JEL classification:

    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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