Do reputation concerns motivate voluntary initiation of corporate social responsibility reporting? Evidence from China

We investigate whether reputation renders a firm more or less likely to report corporate social responsibility (CSR) activities by studying A-share firms listed on the Chinese stock market. After considering the mandatory disclosure rules required by the Shanghai Stock Exchange and the CSI 300 index, we find that a firm is more likely to initiate CSR reporting after it violates security regulations and is punished by supervisors, consistent with our reputation hypothesis. This effect is more prominent for non-state-owned enterprises (non-SOEs), demonstrating that the initiation of CSR reporting might be a remedy to a bad reputation for non-SOEs. By contrast, SOEs may focus more on political rather than economic factors.