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How Does Corporate Party Committee Governance Affect Charitable Donations? Evidence from Heavy-Pollution Industries in China

Author

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  • Huiming Zhang

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Lirong Li

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Cheng Fan

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Zixuan Hang

    (School of Applied Meteorology, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Haroon ur Rashid Khan

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

Abstract

Charitable donations are an effective way for heavy-pollution industries to reduce their environmental reputation risk. In China, the communist party committees within corporations play a key role in decisions regarding charitable donations. However, relatively little is known about the relationship between the governance of corporate party committees and charitable donations. Using data from Chinese listed firms in heavy-pollution industries from 2013 to 2018, we found that corporate party committee governance enhanced the willingness of firms to donate and to increase the amount of their donations significantly. The effect on intention of charitable donations was pronounced for non-state-owned enterprises (NSOEs), whereas the effect on the amount of donations was pronounced for state-owned enterprises (SOEs). Party committee governance increased the amount of charitable donations in regions with a higher level of marketization, but it reduced the amount of charitable donations in firms/industries with a high degree of monopoly. Our findings provide insight for the decisive role of party committees in corporate charitable donations in heavy-pollution industries.

Suggested Citation

  • Huiming Zhang & Lirong Li & Cheng Fan & Zixuan Hang & Haroon ur Rashid Khan, 2021. "How Does Corporate Party Committee Governance Affect Charitable Donations? Evidence from Heavy-Pollution Industries in China," Sustainability, MDPI, vol. 13(21), pages 1-14, November.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:21:p:12242-:d:673253
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    References listed on IDEAS

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