Research On The Impact Of Litigation Events Of Listed Companies On Charitable Donations

Charitable donation has always been the focus of the academic and practical circles.In recent years,the discussion of the motivation of the listed companies’charitable donation is one of the hot topics.Some domestic and foreign literatures have confirmed the universal existence of altruistic motivation,economic motivation and political connection motivation of listed companies from different angles.However,under the background of increasingly complex competition in the external market and industry,the charitable donations of listed companies has gradually surpassed the original "true and good" category.Increasingly,it has become a strategic way for listed companies to face fierce market competition,coping with and resolving company crises,so the motivation of charitable donation is also becoming more and more complex.So,in the context of the intensifying competition in the current industry,will the listed companies use charitable donations to cope with the adverse situation and cover up the adverse events to resolve the crisis?It is necessary for us to make an intensive study.This paper takes the litigation events of listed companies in China from 2007 to 2016 as the starting point to observe whether the listed companies will increase their charitable donations and transfer the public’s attention to the company’s litigation after they are sued,so as to verify the instrumental motivation of charitable donations.Because many factors inside and outside the company affect the charitable donation’s behavior and motivation,this article further starts from the two factors of the company’s management status and industry competitiveness to study the regulatory role of the company’s operating state on the relationship between litigation and charitable donations and the differences in the relationship between different industries in the competition situation.There are five chapters in this paper.The first chapter is the introduction.First,this article set forth the research background,then set up the related literature and make a commentary on the literature.Next is the introduction of the research contexts and the innovation of the article.The second chapter is the definition of the concept and relevant theoretical basis.First,we define the relevant concepts of litigation and charitable donation.Two,we elaborate on the relevant theories of this study,as the theoretical basis for supporting research.The third chapter is the theoretical analysis and research hypothesis,including the quantitative analysis of the status of the listed companies’ litigation and charitable donations,the theoretical deduction and the proposal of the hypothesis.The fourth chapter,the empirical part,provides data support for the research hypotheses from a quantitative perspective.The main contents include introduction of models and variables,descriptive statistics and regression analysis.The fifth chapter is the conclusions and policy proposals.Through the study,it is found that:(1)There is a significant positive correlation between litigation and charitable donations in listed companies.The more lawsuits and the larger the amount of litigation,the more donations for charitable donations,which means that charitable donations are likely to be used by some listed companies as a tool to cover up litigation and reverse the negative image of the company.(2)The listed companies handled by ST significantly enhanced the positive impact of litigation on charitable donations,indicating that deteriorating business conditions significantly improved the instrumental motivation of charitable donations of listed companies.(3)The higher the industry competition is,the more significant the positive correlation between litigation and charitable donations is.That is,the instrumental motivation of charitable donation is stronger in the fierce competition of industry.The main contributions of this article are as follows:(1)Through the research on the instrumental motivation of the listed companies’ charitable donation under the circumstances of the lawsuit,this paper enriches the research content of the litigation events of the listed companies,and expands the scope of the research on the motivation of the listed companies’ charitable donation.In addition,it provides incremental data for the study of motives for charitable donation of listed companies.(2)Because charitable donations of listed companies can help them dissolve the crisis in the fierce competition,improve business performance and debt financing,therefore,we can reasonably publicize the positive effect of charitable donations to mobilize the enthusiasm of listed companies to implement charitable donations,and guide listed companies to take the initiative to undertake social responsibilities.