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Corporate philanthropy and tunneling: Evidence from China
Journal article   Peer reviewed

Corporate philanthropy and tunneling: Evidence from China

J. Chen, W. Dong, J. Tong and F. Zhang
Journal of Business Ethics, Vol.150(1), pp.135-157
2016
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Abstract

This paper examines the association between corporate philanthropy and tunneling by controlling shareholders. Using a unique dataset from China, the paper finds evidence that firms donating more are less likely to tunnel. The negative association between philanthropy and tunneling is stronger when firms are faced with more severe agency conflicts, as indicated by lower largest shareholding, fewer growth opportunities, lower state ownership, and weaker product market competition. The results suggest that companies engaging in philanthropy have incentives to enhance their reputations and improve their relationships with stakeholders.

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Collaboration types
Domestic collaboration
International collaboration
Citation topics
6 Social Sciences
6.3 Management
6.3.385 Corporate Social Responsibility
Web Of Science research areas
Business
Ethics
ESI research areas
Economics & Business
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