Journal of Business Ethics 150 (1):227-258 (2018)

Abstract
We provide the first comprehensive and robust evidence on the relationship between CSR disclosure quality and the costs of corporate bonds in China. We find that firms with high CSR disclosure quality are associated with lower costs of corporate bonds. Our findings are robust to endogeneity issues arising from reverse causality, omitted variable bias, and the interdependencies between price and non-price terms. The negative relationship between CSR disclosure quality and the costs of corporate bonds is stronger in weak corporate governance firms and in firms located in regions with weak institutional environments. We also find that firms’ misconduct significantly mitigates the influence of CSR disclosure quality. In the additional analyses, we provide evidence that CSR disclosure can offer incremental information beyond the credit ratings. Regarding non-price terms, we conclude that firms with higher quality of CSR information are less likely to be subject to collateral terms, but they tend to include more restrictive covenants. Further analyses also show that compared with low-quality or mandatory CSR disclosure firms, bond investors perceive firms with CSR disclosures rated above “A” categories or voluntary CSR disclosure as less likely to cause asymmetric information problems and thus charge lower risk premiums. Overall, this study demonstrates that CSR disclosure quality is an important determinant that affects both price and non-price bond contract terms.
Keywords No keywords specified (fix it)
Categories (categorize this paper)
ISBN(s)
DOI 10.1007/s10551-016-3193-8
Options
Edit this record
Mark as duplicate
Export citation
Find it on Scholar
Request removal from index
Revision history

Download options

PhilArchive copy


Upload a copy of this paper     Check publisher's policy     Papers currently archived: 65,587
External links

Setup an account with your affiliations in order to access resources via your University's proxy server
Configure custom proxy (use this if your affiliation does not provide a proxy)
Through your library

References found in this work BETA

How the Market Values Greenwashing? Evidence From China.Xingqiang Du - 2015 - Journal of Business Ethics 128 (3):547-574.

View all 16 references / Add more references

Citations of this work BETA

Add more citations

Similar books and articles

Firm Performance, Corporate Ownership, and Corporate Social Responsibility Disclosure in China.Wei Luo Qi Li - 2013 - Business Ethics, the Environment and Responsibility 22 (2):159-173.
The Factors Influencing Corporate Social Responsibility Disclosure in the Kingdom of Saudi Arabia.Ayman Issa - 2017 - Australian Journal of Basic and Applied Sciences 11 (10):1-19.

Analytics

Added to PP index
2018-06-06

Total views
29 ( #382,860 of 2,461,941 )

Recent downloads (6 months)
3 ( #223,013 of 2,461,941 )

How can I increase my downloads?

Downloads

My notes