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| A Study on Insurance Effects and Restoration Effects of Corporate Social Responsibility in the Context of a Negative Event |
| FAN Jianfeng，ZHAO Qiuru，TIAN Zhilong |
| 1. Wuyi University， Jiangmen， Guangdong， China; 2. Huazhong University of Science and Technology， Wuhan， China |
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Abstract This study examines whether pre-events CSR and post-events CSR can provide insurance effects and restoration effects for the shareholders’ wealth of firms during occurrence of negative events by the event study methodology, based on the Chinese companies. The results show that pre-events CSR can provide insurance-like effects on the stock prices of firms in negative events if they have performed CSR for a long time and continuously before the events. Differing from CSR’s insurance-like effects, both the short-term and the long-term post-events CSR can provide restoration effects on firms in negative events. The long-term CSR of the competitors has a significant negative impact on CSR insurance effects and the short-term CSR of the competitors does not. The long- and short-term CSR of the competitors has a significant negative impact on CSR restoration effects.
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Received: 03 July 2019
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