Research On The Mitigation Impact Of Corporate Targeted Poverty Reduction On Financing Constraints

Although China's capital markets have developed rapidly in recent years,the existing funds are clearly unable to meet the needs of all enterprises.The high listing threshold,strict refinancing approval,and the underdeveloped bond market,Which have caused the financing problem is still a huge problem for the sustainable development of listed companies in China.Information asymmetry and moral hazard are the main problems in the process of corporate financing.In an imperfect market,how to reduce the degree of information asymmetry between the supply side and the demand side becomes the key to reducing financing constraints.Existing literature researches show that enterprises fulfill their social responsibilities and disclose relevant information,transmit positive signals to the suppliers of funds and accumulate reputation,thus effectively reducing corporate financing constraints.The implementation of targeted poverty reduction activities by enterprises is a manifestation of their active fulfillment of social responsibilities.After reading a lot of literatures,it is found that no one has conducted relevant research on the sub-sectors of social poverty alleviation,and the “targeted poverty reduction” policy is now strongly advocated by the state.At this stage,many listed companies are actively responding to the ongoing work.Therefore,it is of great practical significance to conduct research on the targeted poverty reduction behavior of enterprises alone.After clarifying the main related concepts involved in this paper,through systematically reviews the domestic and international researches on corporate social responsibility,financing constraints and the relationship between them,and then based on information asymmetry theory,signal transmission theory,principal-agent theory,social responsibility theory,esource dependence theory and stakeholders theory,we use the combination of normative research and empirical research to analyze the impact of on the implementation of targeted poverty reduction activities on enterprises' financing constraints,and specifically,it examines the impact of targeted poverty reduction behaviors on financing constraints from the perspectives of Whether to poverty reduct and the power of poverty reduction.Finally,it is further tested whether the impact is different among different social responsibility sensitive industries and enterprises in different regional institutional environments.This paper uses the KZ index constructed by Kaplan and Zingales(1997)to build a model,then collects the data of the A-share main board listed companies from 2016 to 2017,when required listed companies to disclose targeted poverty reduction in the annual report.The research results show that China's listed companies generally face varying degrees of financing constraints,but enterprises actively carry out targeted poverty reduction activities can effectively alleviate their own financing constraints and the greater the poverty alleviation,the greater the mitigation effect on financing constraints.Further grouping of the samples found that the mitigation effect of the targeted poverty reduction activities on its financing constraints is also affected by industry sensitivity and regional institutional environment,mainly as follows:(1)Compared with non-socially responsible sensitive enterprises,the mitigation of financing constraints by sensitive enterprises to carry out targeted poverty reduction activities is more significant,and the greater the poverty reduction,the greater the mitigation effect on financing constraints.(2)Compared with enterprises in the eastern region with a sound institutional environment,the targeted poverty reduction activities of enterprises in the central and western regions with backward institutional environment have more significant mitigation effects on financing constraints,and the greater the poverty reduction,the greater the mitigation effect on financing constraints.The main contributions of this paper are as follows: Firstly,research on the implementation of targeted poverty reduction activities by enterprises provides a new perspective for the study of corporate social responsibility issues,and provides new empirical evidence for research on issues related to corporate social responsibility and financing constraints.Second,the research conclusions of this paper can provide reference for listed companies to carry out targeted poverty reduction,help them to respond to the national call,actively participate in social welfare undertakings,and promote the more comprehensive development of listed companies.