Geographical influences on the relationship between corporate philanthropy and corporate financial performance. Issue 5 (3rd May 2020)

• Record Type: Journal Article
• Authors: Lu, Jane; Liang, Xueji; Wang, Heli
• Is Part Of: Regional studies. Volume 54:Issue 5(2020)
• Page Start: 660
• Page End: 676
• Publication Date: 2020-05-03
• Subjects: corporate philanthropy -- corporate financial performance -- geographical influences -- stakeholder perception -- information availability; L2 -- M14; Regional planning -- Periodicals; Regional planning -- Great Britain -- Periodicals; 307.14
• DOI: 10.1080/00343404.2019.1668551
• Languages: English
• ISSNs: 0034-3404

Abstract

ABSTRACT: Building on stakeholder theory, the paper argues that geographical differences in stakeholders' reactions to corporate philanthropy lead to differences in the relationship between corporate philanthropy and corporate financial performance across regions. When comparing the United States and China and different regions within China, it is found that the differences in stakeholder perceptions (as reflected by sinful industry) and information availability (as indicated by advertising intensity) across regions significantly moderate the corporate philanthropy–corporate financial performance relationship. The findings show that the value of corporate philanthropy varies by region and that stakeholder perception and information availability are two important mechanisms through which corporate philanthropy influences corporate financial performance.