Does Charitable Donation Of Private Enterprises Improve The Value Of The Company?

Charitable donations are an important way to fulfill social responsibilities.Compared with developed countries,the theoretical research and practical development of charitable donations in China is relatively late.With the continuous development of the economy,charitable donations are no longer rare,especially in the face of frequent natural disasters in recent years,enterprises have extended a loving hand;However,there is still a vague understanding of charitable causes among enterprises themselves,and there is still no unified understanding of the relationship between charitable donations and corporate value in the academic community.This paper selects private enterprises as the research object.Based on stakeholder theory,resource dependence theory and reputation theory,this paper develops relevant hypotheses about the impact consequences and impact mechanism of charitable donations on enterprise value.At the same time,the data of 195 listed private enterprises from 2010 to 2021 are selected as samples,and multiple regression analysis and mesmeric effect model are used to verify the research hypothesis.The research finds that private enterprises’ charitable donation can promote the improvement of enterprise value,and this conclusion is still valid after a series of tests such as endogenous test and robustness test.Secondly,the proportion of inventory can serve as an intermediary variable between charitable donations and corporate value.Charitable donations by enterprises enhance brand reputation,reduce the proportion of inventory,increase cash flow,and ultimately enhance corporate value through product market paths.In addition,this article also conducted heterogeneity testing based on the grouping of companies’ listing times,and concluded that companies should persist in charitable donations for a long time,continuously accumulate development advantages,and ultimately achieve an increase in corporate value.Based on the above research results,it is proposed that private enterprises should adhere to strategic charitable donations and achieve long-term benefits in response to the current situation of charitable donations by private enterprises;The government should establish and improve an effective institutional mechanism to promote private enterprises to make independent and long-term charitable donations,build a transparent platform for donation information,and create a healthy and positive market atmosphere for charitable donations.The research significance of this article lies in studying private enterprises separately to make up for the shortcomings of research on charitable donations by private enterprises.Selecting the sales indicator inventory proportion as the product market intermediary observation indicator,intuitively observing the impact of charitable donations on the company,enriches the research on intermediary indicator selection and financial performance research.