Does Voluntary Adoption of Clawback Provisions Improve Corporate Social Responsibility: Evidence from China

17 Pages Posted: 25 Jan 2024

See all articles by Donghua Zhou

Donghua Zhou

Jiangxi University of Finance and Economics

liu yang

Jiangxi University of Finance and Economics

Yujie Zhao

Shanghai University

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 behaviors. 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 lesser sense of responsibility. Our study represents a pioneering exploration of the beneficial effects of clawback provisions in China.

Keywords: clawback provisions, Corporate social responsibility, short-termism, risk aversion, Executive Compensation

Suggested Citation

Zhou, Donghua and yang, liu and Zhao, Yujie, Does Voluntary Adoption of Clawback Provisions Improve Corporate Social Responsibility: Evidence from China. Available at SSRN: https://ssrn.com/abstract=4706617 or http://dx.doi.org/10.2139/ssrn.4706617

Donghua Zhou

Jiangxi University of Finance and Economics ( email )

South Lushan Road
Nanchang, Jiangxi 330013
China

Liu Yang

Jiangxi University of Finance and Economics ( email )

South Lushan Road
Nanchang, 330013
China

Yujie Zhao (Contact Author)

Shanghai University ( email )

149 Yanchang Road
SHANGDA ROAD 99
Shanghai 200072, 200444
China

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