Does corporate social responsibility matter in the food industry? Evidence from a nature experiment in China

Using the melamine contamination incident in China as an exogenous shock, this paper studies how the investors respond to corporate social responsibilities (CSRs) of listed firms in food industry. We find that investors’ or consumers’ concerns for CSR in the food industry could be significantly influenced by the mounting attention given to CSR-related events. This study offers important policy implications. First, the government, as well as supervisors, should release appropriate policies to improve various firms’ activities on CSR, especially in the food industry. Second, firms, particularly those in the food industry, can obtain long-term benefits by strengthening their CSR-related activities.     

The differential effects of CEO narcissism and hubris on corporate social responsibility

Research Summary: While prior studies have predominantly shown that CEO narcissism and hubris exhibit similar effects on various strategic decisions and outcomes, this study aims to explore the mechanisms underlying how narcissistic versus hubristic CEOs affect their firms differently. Specifically, we investigate how peer influence moderates the CEO narcissism/hubris—corporate social responsibility (CSR). With a sample of S&P 1500 firms for 2003–2010, we find that the positive relationship between CEO narcissism and CSR is strengthened (weakened) when board‐interlocked peer firms invest less (more) intensively in CSR than a CEO's own firm; the negative relationship between CEO hubris and CSR is strengthened when peer firms are engaged in less CSR than a CEO's own firm. Managerial Summary: Some CEOs are more narcissistic while others may be more hubristic, but these two groups of CEOs hold different attitudes toward the extent to which their firms should engage in corporate social responsibility (CSR). Our findings with a large sample of U.S. publically listed firms suggest that narcissistic CEOs care more about CSR, but hubristic CEOs care less. Interestingly, when narcissistic CEOs observe their peer firms engaging in more or less CSR than their own firms, they tend to respond in an opposite manner; in contrast, hubristic CEOs will only engage in even less CSR when their peers also do not emphasize CSR. Our findings point to a fundamental difference between CEO narcissism and hubris in terms of how they affect firms' CSR decisions based on their social comparison with peer firms.     

红色战略还是灰色战略——针对我国制度转型中企业战略迷失的实证研究

我国制造业公司目前陷入了战略迷失:在重视市场的红色战略和利用正式制度漏洞来寻租的灰色战略两者之间应该选择哪一个?基于我国的制度转型情境,我们采用战略均衡三角理论,通过我国制造业所有上市公司2000—2010年15620个公司年的数据,研究了近十年制度转型过程中企业战略迷失问题的形成以及作用机制。研究表明,政府不正确的、过度的干预,不仅会影响企业行为的获利回报,而且会导致企业战略行为选择的错位。同时指出,在战略均衡的三角中,制度观视角比产业观、资源观视角更能够解释我国企业的战略行为,且与后两者属于不同维度。本研究加深了人们对我国企业关系型战略、战略与商务模式匹配、政府角色等问题的理解。     

Competing for government procurement contracts: The role of corporate social responsibility

Research Summary: This study examines whether corporate social responsibility (CSR) improves firms’ competitiveness in the market for government procurement contracts. To obtain exogenous variation in firms’ social engagement, I exploit a quasi‐natural experiment provided by the enactment of state‐level constituency statutes, which allow directors to consider stakeholders’ interests when making business decisions. Using constituency statutes as instrumental variable (IV) for CSR, I find that companies with higher CSR receive more procurement contracts. The effect is stronger for more complex contracts and in the early years of the government‐company relationship, suggesting that CSR helps mitigate information asymmetries by signaling trustworthiness. Moreover, the effect is stronger in competitive industries, indicating that CSR can serve as a differentiation strategy to compete against other bidders. Managerial Summary: This study examines how companies can strategically improve their competitiveness in the market for government procurement contracts—a market of economic importance (15–20% of GDP). It shows that companies with higher social and environmental performance (CSR) receive more procurement contracts. This effect is stronger for more complex contracts, in the early years of the government–company relationship, and in more competitive industries. These findings indicate that firms’ CSR can serve as a signaling and differentiation strategy that influences the purchasing decision of government agencies. Accordingly, managers operating in the business‐to‐government (B2G) sector could benefit from integrating social and environmental considerations into their strategic decision making.     

Red,blue, and purple firms: Organizational political ideology and corporate social responsibility

Research summary : Why do firms vary so much in their stances toward corporate social responsibility (CSR )? Prior research has emphasized the role of external pressures, as well as CEO preferences, while little attention has been paid to the possibility that CSR may also stem from prevailing beliefs among the body politic of the firm. We introduce the concept of organizational political ideology to explain how political beliefs of organizational members shape corporate advances in CSR . Using a novel measure based on the political contributions by employees of Fortune 500 firms, we find that ideology predicts advances in CSR . This effect appears stronger when CSR is rare in the firm's industry, when firms are high in human capital intensity, and when the CEO has had long organizational tenure . Managerial summary : Why do firms vary in their stances toward corporate social responsibility (CSR )? Prior research suggests that companies engage in CSR when under pressure to do so, or when their CEOs have liberal values. We introduce the concept of organizational political ideology, and argue that CSR may also result from the values of the larger employee population. Introducing a novel measure of organizational political ideology, based on employees' donations to the two major political parties in the United States, we find that liberal‐leaning companies engage in more CSR than conservative‐leaning companies, and even more so when other firms in the industry have weaker CSR records, when the company relies heavily on human resources and when the company's CEO has a long organizational tenure . Copyright © 2016 John Wiley & Sons, Ltd.     

Research notes and communications: The effect of product recall announcements on shareholder wealth

Previous research Has found that product recall announcements in the automobile industry are associated with negative abnormal returns. We extend this research by examining announcements of product recalls and products taken off the market outside the automobile industry. We find negative abnormal returns for these announcements and that the returns are significantly more negative when products are replaced (or the purchase price is returned) than when the products are checked and repaired. We find only limited evidence that government-ordered recalls produce more negative returns than voluntary recalls.     

Benefit or damage? The productivity effects of FDI in the Chinese food industry

We investigate the impact of foreign direct investment (FDI) on the total factor productivity of Chinese food firms using firm-level census data between 1998 and 2007 (174,940 sample food firms). We test for within-firm, within-industry, and vertical effects. We find that the effect of FDI on the productivity of Chinese food firms depends significantly on the type of FDI and its countries of origin. FDI from non-HMT (Hong Kong, Macaw and Taiwan) regions can improve the productivity of the invested firm, and also increases the productivity of domestic food firms through vertical industry linkages. However, domestic food firms may be crowded out by non-HMT investment in the same industry. HMT investment can generate positive within-industry productivity spillovers, but negative vertical spillovers. Our findings have immediate implications for policymakers in China, as well as for governments of less developed countries that are formulating foreign investment policies.     

Does engagement in corporate social responsibility provide strategic insurance‐like effects?

Research summary : This study examines whether the stock and bond prices of firms engaging in corporate social responsibility (CSR) can benefit from insurance‐like effects during occurrences of negative events. Our results suggest that in the face of negative events, engagement in CSR on a continuous, long‐term basis provides insurance‐like effects on both the stock and bond prices of firms. Nevertheless, the effects are found to quickly disappear following the occurrence of a second, or subsequent, negative event. Although our results clearly indicate that firms need to allocate some of their available resources to long‐term strategic CSR activities, managers must also realize that in a crisis communication, they will probably be able to use their CSR claims on one occasion only. Managerial summary : The purpose of this article is to examine whether firms engaging in corporate social responsibility (CSR) can benefit from insurance‐like effects during occurrences of negative events. We find that on the occurrence of a negative event, long‐term CSR engagement does have insurance‐like effects. We also find that these insurance‐like effects may quickly disappear following the occurrence of a second negative event. Managers of firms with a long history of CSR activities need to realize that in a crisis communication, they can probably use their claims of adherence to CSR only once. Copyright © 2015 John Wiley & Sons, Ltd.     

中国食品大企业的可持续发展研究

食品行业是我国国民经济发展的支柱产业,对国民经济运行和市场经济发展都有非常重要的影响。加快食品工业的发展,确保食品安全,是国家可持续发展战略的重要选择。2008年以“三鹿奶粉事件”为导火索,食品行业出现了很多问题,对食品企业的可持续发展产生了不良影响。作为食品企业该如何做到可持续发展,本文在阐述我国食品大企业发展现状的基础上分析了食品行业面临的问题,对此从企业、政府、社会三个层面提出了相应的解决对策和建议。     

集体声誉危机与企业认证行为——基于“柠檬市场”治理机制的视角

中国制造业部门时有发生的行业集体声誉危机不仅抑制了消费者对中国产品的需求,也造成了企业行为扭曲。本文从“柠檬市场”不同治理机制间的交互作用入手,构建理论模型考察了行业集体声誉危机对被牵连企业认证行为的影响机理,并以中国乳制品行业为样本,运用双重差分法进行实证检验。研究发现,集体声誉危机通过破坏市场声誉机制提高了企业的认证激励,原本没有必要申请认证的高质企业比低质企业更愿意在危机后加大认证申请。此外,集体声誉危机还引发了企业非理性的过度认证,在穷尽强相关认证后,企业的认证激励并未减弱反而转向申请其他弱相关认证。额外增加的认证成本抵消了认证对销售收入增长的促进作用,导致“过度认证陷阱”,不利于企业质量提升和危机行业的转型升级。上述结论从企业认证行为扭曲这一视角拓展了有关集体声誉危机负面效应的认识,对政府避免危机发生以及完善认证行业发展有着积极的指导意义。     

Corporate social responsibility,firm reputation,and firm performance: The role of ethical leadership

This study investigated the antecedents and outcomes of corporate social responsibility (CSR) and the moderating effects of ethical leadership. We collected two-wave, temporally lagged data from two sources (general and vice-general managers) in 199 tourism firms (hotels and travel agencies) in southeast China. We have two major findings. First, ethical leadership moderated its own indirect effect on firm reputation via CSR. It had an indirect and positive effect on firm reputation through CSR when ethical leadership was strong but not when it was weak. Second, ethical leadership also moderated the indirect effect of CSR on firm performance via firm reputation. There was an indirect and positive effect of CSR when ethical leadership was strong but not when ethical leadership was weak. This study highlights the role of ethical leadership in linking the antecedents and outcomes of CSR, and provides support for the stakeholder theory.     

Sustainability program brands: Platforms for collaboration and co-creation

While CSR and sustainability have been widely debated topics over the past decades, there is still evidence of unethical practices by businesses, as witnessed through corporate scandals across a number of industry sectors. This highlights the need for firms to collaborate to actively prevent malpractices and instead find ways to improve standards along the whole value chain. With the increased pressure from various stakeholders, calling for firms to address these issues in a collaborative and holistic manner, the development of models facilitating collaboration is vital. Taking a communication perspective, this paper seeks to improve the knowledge on how organisations can manage diverse stakeholders to improve value chain collaboration towards more sustainable practices. Based on a multiple case study methodology, involving in-depth interviews with senior directors in the food and drink value chain, a framework is developed, depicting the value of a branded sustainability program as a useful platform for stimulating collaboration and co-creation from diverse and/or competing stakeholders. The framework builds on, and contributes to several literature strands including CSR/sustainability communication, coopetition and branding.     

融资约束、政府补贴与新能源企业投资效率——基于异质性双边随机前沿模型

从融资视角来看,新能源产业的发展因其自身特点受制于较强的融资约束。因其引发的资金不足问题导致新能源企业的投资效率低下。为扶持新能源产业的发展,政府补贴成为缓解融资约束的必然选择。本文基于2010～2014年新能源产业微观数据,在全样本和按企业异质性分组的子样本下,利用异质性双边随机前沿模型定量估计融资约束和政府补贴对新能源企业投资效率的双边效应和净效应。研究结果表明：平均而言,政府补贴对新能源产业上市企业投资效率的正向效应能够平滑融资约束的负效应,但却未能完全正负抵消,新能源产业上市企业仍存在投资不足现象。但也有1/4的企业存在过度投资现象。从新能源上市企业的异质性来看,东部地区企业和非国有企业的投资效率更高。     

Ownership,organization, and private firms' efficient use of resources

The principal–agent theory asserts that public firms' performance is driven by efficient capital and labor markets but is silent about non‐listed private companies, which are less permeable to market forces (both capital and labor) than are public companies. We propose and test a 2 × 2 framework distinguishing owner‐controlled vs. agent‐led firms from firms with a flat vs. multilayer organization. Our findings provide highly contrasted results and raise important issues for further study of private firms. Copyright © 2003 John Wiley & Sons, Ltd.     

Inventory in mainland China: Historical, industry, and geographic perspectives

We review inventories in mainland China by evaluating the trajectory of aggregate inventories in recent decades, and then modelling the relationship of inventories in some 300,000 manufacturers with respect to volume (using cost of goods sold), industry (using SIC codes), and geographical location (using the 31 regions of China). We find that inventories generally exhibit economies of scale (in terms of cost of goods sold) in all but one industry (tobacco), and differ widely by province, with relatively high inventories in remote regions.We provide explanations for apparent diseconomies of scale for large unlisted firms, and reflect on why publicly listed manufacturers have significantly higher inventories than do unlisted firms. We note that manufacturing inventories as a proportion of manufacturing value-added are substantially higher in China than in the US The results may be employed for benchmarking and auditing of firms and managers, as well as for conducting due diligence for investment, mergers and acquisitions.     

中国转轨过程中的企业扩张行为

经济转轨时期,中国企业表现出强烈的扩张冲动。鉴于转轨时期政府对企业生产决策有重大的影响,仅从企业自身考量不能全面解释企业扩张的冲动。文章在企业的生产决策过程中考虑了政府因素,并构建模型分析政府对企业扩张的影响。政府官员对产出和企业规模的强烈偏好使企业将产出引进目标函数而偏离利润最大化的目标,导致企业规模高于企业利润最大化时的规模,过度扩张。随着转轨过程的深化,政府应停止干预企业微观运行的行为,转而为企业发展塑造良好的制度环境。     

企业社会责任相对水平与消费者购买意向关系的实证研究

行业内的相对企业社会责任(CSR)水平与消费者购买意向关系的实证研究表明:行业内的相对CSR水平高(或低),消费者购买意向也相应地高(或低);消费者能够接受的CSR处于行业领先水平企业的产品提价的幅度显著小于要求CSR处于行业落后水平企业的产品降价的幅度;在参照对象分别为CSR处于行业落后水平企业的产品和参照对象为CSR处于行业中等水平企业的产品时,消费者对CSR处于行业领先水平企业的产品的购买意向存在显著差异,但愿意接受的提价幅度没有显著差异。     

Ground beef recalls and subsequent food safety performance

The U.S. Food Safety Inspection Service recalled more than 370 million pounds of meat and poultry products and oversaw 680 Class 1 recalls over 1998–2014. The cost to firms was about $109 million in lost market value (Pozo and Schroeder, 2016). Thomsen and McKenzie (2001) argue that firms internalize the costs of recalls, and Marino (1997) asserts that high food safety costs lead to food safety investment, but no research has examined the impact of recalls on plant food safety performance. Using performance on tests for Salmonella conducted by the Food Safety Inspection Service as a measure of food safety, this article examines the performance on Salmonella tests of ground beef plants with Class 1 recalls. The results show that plants have high Salmonella levels before and during the year of the recall and have much lower levels afterward. The paper also shows that ground beef plants with recalls are less likely to meet the FSIS standard for Salmonella and that the likelihood of failing to meet the standard increases as the standard becomes more stringent.     

Do‐no‐harm versus do‐good social responsibility: Attributional thinking and the liability of foreignness

Research summary: The efforts of multinational corporations to be socially responsible do not always engender positive evaluations from overseas stakeholders. Drawing on attribution theory, we argue that two heuristics guide stakeholders in evaluating firms' social performance: foreignness and the valence of firms' social responsibility. We provide evidence from a field study of secondary stakeholders and an experimental study involving 129 non‐governmental organizations. Consistent with attribution theory, the liability of foreignness is minimized when firms engage in “do‐good” social responsibility (focused on proactive engagement creating positive externalities) but is substantial when firms engage in “do‐no‐harm” social responsibility (focused on attenuating negative externalities). In online supporting information, Appendix S1, we demonstrate that these evaluations have consequences for whether stakeholders subsequently cooperate, or sow conflict, with firms. Managerial summary: There is no guarantee that efforts to be socially responsible will improve multinational corporations' relations with overseas stakeholders, such as customers, governments, and activists. In a field study and an experiment, we unpack when foreign firms suffer from harsh stakeholder evaluations. Foreign firms especially suffer from harsh evaluations when they conduct “do‐no‐harm” CSR rather than “do‐good” CSR. Stakeholders attribute the motive for foreign firms' do‐no‐harm CSR to managerial interests and shareholder pressures, perceiving a wedge between managers and owners (who may be unmotivated to reduce the negative impacts of their business activities) and local stakeholders (who bear the social costs). A practical implication is that foreign firms gain more from highlighting do‐good rather than do‐(no)‐harm CSR initiatives. Copyright © 2015 John Wiley & Sons, Ltd.     

Recombination for innovation: performance outcomes from international partnerships in China

This paper examines the relationship between different types of international partnerships and innovation performance. By drawing on a conceptual framework which outlines how new bundles of transferrable and nontransferrable ownership advantages are created from such partnerships (Collinson and Narula, 2014 ), we analyze empirical evidence from a large‐scale survey of 320 individual company responses from the China‐based operations of foreign multinational firms alongside in‐depth case studies. Our study reveals that different types of collaborative partnerships (cooperative vs. competitive) are associated with different innovation performance outcomes (product vs. process innovation). In addition, we find that a sustainable, reciprocal relationship between collaborative partners can generate superior innovation performance. Contextual factors including the role of government and industry characteristics have an important bearing on innovation performance in collaborative partnerships in China. We conclude with implications for researchers, managers, and policymakers.