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The internal mechanism of corporate social responsibility fulfillment affecting debt risk in China: analysis of intermediary transmission effect based on degree of debt concentration and product market competitive advantage

Data publikacji: 30 Sep 2022
Tom & Zeszyt: AHEAD OF PRINT
Zakres stron: -
Otrzymano: 02 Oct 2021
Przyjęty: 15 May 2022
Informacje o czasopiśmie
License
Format
Czasopismo
eISSN
2444-8656
Pierwsze wydanie
01 Jan 2016
Częstotliwość wydawania
2 razy w roku
Języki
Angielski
Introduction

China is the world's second-largest emerging economy, and its extensive economic growth led to serious negative externalities in the environment and society in the past. The increasingly exposed poor CSR performance poses a severe challenge to the whole commercial society. Similarly, liability management plays a pivotal role in the development strategy of a firm. Appropriate debt is conducive to the expansion of business scale, however, excessive reliance on operating in debt will lead to corporate debt risk. For a long time, most scholars have been engaged in the research on the economic consequences of CSR such as in the aspect of corporate financial performance [1], shareholder wealth [2], capital cost [3, 4], the credit rating [5] and so on. However, few literatures discuss the relationship and internal mechanism between CSR fulfillment and debt risk.

What determines a company's capital structure? Although there have been many theoretical studies on the structure of debt. Whether CSR fulfilment can alleviate information asymmetry and agency problems between firms and creditors so that firms can raise debt funds from more channels to reduce debt risks? More and more firms regard the implementation of CSR as a business strategy to increase the competitive advantage of the product market and a key means to achieve sustainable development of firms. Whether the fulfillment of CSR will reduce the debt risk of firms by establishing competitive advantages in the product market is worth further discussion. In addition, this paper also tries to explore whether the above mechanism will be different due to the firms with different nature of property rights and firms in different regions?

Based on the above problems, this paper makes use of A-share listed companies in Shanghai and Shenzhen Stock exchanges from 2010 to 2019 as samples to investigate the mechanism of CSR fulfilment affecting firm debt risk. The research results show that: Firstly, fulfillment of CSR is a negative correlation with debt risk, indicating CSR performance can significantly inhibit debt risk. Secondly, CSR performance plays a significant role in restraining debt risk by dispersing the degree of debt concentration and establishing competitive advantages in the product market. Thirdly, in order to ensure the reliability of the research conclusions, we conducted a series of robustness tests, and we replaced measurement method of explanatory variable, intermediary variable and the explained variable in the meantime to test the above two paths respectively; in addition, we used the bootstrap method for verification existence of mediation effects. Finally, in further analysis, we find that in private firms and firms in the eastern region, fulfilment of CSR has a more significant inhibiting effect on debt risk through dispersing the degree of debt concentration and establishing competitive advantages in the product market.

The possible marginal contribution of this article is: Firstly, it has theoretical and practical significance to help us identify the specific path and mechanism of CSR performance affecting debt risk, and it also plays a supplementary role in the study of economic consequences in the field of CSR. Second, the current research on factors affecting the structure of debt is not mature. Existing empirical studies mainly focus on how companies choose different types of debt, but no researches has focused on how the fulfillment of CSR affects firms’ choice of different types of debt, and mitigate the debt risk by reducing the degree of debt concentration. Third, different from the most previous literatures that discussed product market competition as a meso environmental factor in different research frameworks, this paper takes the firm's own competitive advantage as the research object, as it is more targeted to discuss at the micro-level whether the fulfilment of CSR will enhance the competitive position of firms and thus affect the debt risk. In addition, this paper further deepens the understanding of the relationship between CSR fulfilment and debt risk that firms operate under different property rights and in different regions. The rest of this article is arranged as follows. The second part introduces the literature review and research hypothesis. The third part is the research design. The fourth part provides the empirical results. The fifth part provides further study. The last part is the conclusions and policy recommendations.

Literature review and research hypothesis
The impact of CSR fulfilment on debt risk

This paper reviews the research achievements of domestic and foreign scholars in recent years, it is found that there are four main reasons to explain why the fulfilment of social responsibility hurts debt risk: Reducing the cost of debt financing, extending the debt maturity and reducing the strictness of debt contract, and improving the credit rating, to have a restraining effect on debt risk. First, in terms of reducing the cost of debt financing, Goss and Roberts (2011) [4] conducted a sample survey of 3996 corporate loans in the United States and found that the loan interest rate of firms with better CSR is 7–18 basis points lower than that of firms only focusing on CSR. Second, in terms of extending debt maturity and reducing the strictness of debt contracts, Shi and Sun (2015) [6] found that the more the firms invest in CSR, the fewer the restrictive clauses in debt contracts. Third, in recent years, studies have more focused on the relationship between CSR and credit rating. Attig et al. (2013) [7] showed that credit rating agencies tend to give higher credit ratings to firms that perform well in social responsibility. The above studies all believe that firms that play an active part in CSR can reduce debt risk because of their good corporate image, lower debt financing costs, more relaxed credit conditions and higher credit rating. According to the above conclusion, we deduce the first research hypothesis:

H1: The fulfilment of CSR can inhibit the debt risk faced by firms.

CSR fulfilment and debt risk: the mediating effect based on the degree of debt concentration

The decentralised debt structure has two sides to the firm. On the positive side, the decentralised debt structure will lead to the difficulty of communication between different creditors, to continue to get support from different types of creditors, and the firm usually will cut back on improper borrowing, which will result in the debt risk of the firm to be low at this time. On the negative side, the firm with a decentralised debt structure means it has different types of creditors at the same time, and different creditors are more likely to have conflicts of interest or free riders. The decentralised debt structure makes it more difficult for different creditors to communicate and negotiate, and the firms need to coordinate the interests of different creditors, thereby reducing creditors’ willingness to learn more about the firm. It also lets managers have the opportunity to borrow heavily so that the debt risk rises. The fulfilment of CSR will increase firm information transparency, thus it helps to reduce the risk of failure of communication between creditors, enabling more investors to be willing to hold firm's debt, when the higher the degree of CSR fulfilment will help firms enlarge the positive side brought by the decentralised debt structure and avoid the negative side. Based on this, we propose a hypothesis:

H2: The degree of debt concentration is the mediating factor that the CSR fulfillment of firms influences debt risk.

CSR fulfilment and debt risk: the mediating effect based on the product market competitive advantage

With the development of the market economy, firms are facing increasingly fierce competition. The competition among firms has risen from the concrete level of product quality and price to the abstract level of business ethics and moral standards. Enterprises that actively fulfil CSR can handle the relationship with key stakeholders (such as the government, customers and employees) well, and promote firm innovation so that it can build a competitive advantage in product markets. For firms with a competitive advantage in the product market, because of its larger product differentiation or the substitutability of the product is lower, the demand curve for products will be more inelastic. When firms are threatened by rising production costs, they can flexibly transfer the cost shock to the customer, therefore, they can maintain the profitability better and reduce cash flow fluctuation, and thus reduce the possibility of firm debt risk. Based on this, we propose a hypothesis:

H3: Product market competitive advantage is the mediating factor that CSR fulfilment influences debt risk.

Research design
Sample selection and data sources

This paper takes the Chinese A-share listed companies in Shanghai and Shenzhen stock exchanges from 2010 to 2019 as research samples, and carries out the following processing: (1) remove the samples of listed companies with abnormal trading status such as ST, * ST, PT, etc; (2) the samples with missing main variables were excluded; (3) excluding financial and insurance listed companies; (4) to avoid the influence of extreme outliers, this paper conducts winsorize tail reduction on all continuous variables at the level of 1%, and finally obtains annual observations of 23660 companies. The CSR data of this paper comes from the CSR rating database Hexun.com. The financial data used in this paper are from the CSMAR database.

Main variable setting
Debt risk

When Agarwal and Taffler (2008) [8] conducted a cross-border analysis, they found that the Z_score model was superior to the risk-based and market-based prediction model in the accuracy of debt risk prediction. In a recent study, Altman et al. (2017) [9] confirmed the effectiveness of Z_score as a predictor of debt risk.

So in this paper, Altman's (1968) [10] Z_score is adopted to measure a firm's debt risk, and the specific calculation formula is as follows:

Z_score = 1.2 × (Operating funds/Total asset) + 1.4 × (Retained earnings/Total asset) + 3.3 × (Earnings before interest and tax/Total asset) + 0.6 × (Value of equity/Value of liability) + 1 × (Sales revenue/Total asset)

The higher the value of the Z_score, the better the financial status and the lower the debt risk of the firm. For the sake of explanation, Z_score has been negative in the follow-up empirical test.

CSR

The main explanatory variable is CSR, which is the comprehensive score of CSR published by hexun.com from 2010 to 2019. The rating system integrates the CSR fulfillment in five aspects: Shareholders, employees, rights and interests of suppliers, customers and consumers, environment and society of listed companies. The full score is 100, the higher the score, the better the fulfilment of CSR.

Intermediary variable 1: degree of debt concentration (Loanconcen)

Based on the research of Li et al. (2020) [11], the calculation formula for the degree of debt concentration is as follows: SSi,t=(TCi,tTDi,t)2+(BLi,tTDi,t)2+(FLi,tTDi,t)2+(BLi,tTDi,t)2+(FLi,tTDi,t)2Loanconceni,t=(SSi,t1/5)/(11/5) \matrix{ {\;\;\;\;\;\;\;\;\;\;\;\;\;{\rm{S}}{{\rm{S}}_{i,t}} = {{\left( {{{{\rm{T}}{{\rm{C}}_{i,t}}} \over {{\rm{T}}{{\rm{D}}_{{\rm{i,t}}}}}}} \right)}^2} + {{\left( {{{{\rm{B}}{{\rm{L}}_{i,t}}} \over {{\rm{T}}{{\rm{D}}_{i,t}}}}} \right)}^2} + {{\left( {{{{\rm{F}}{{\rm{L}}_{i,t}}} \over {{\rm{T}}{{\rm{D}}_{i,t}}}}} \right)}^2} + {{\left( {{{{\rm{B}}{{\rm{L}}_{i,t}}} \over {{\rm{T}}{{\rm{D}}_{i,t}}}}} \right)}^2} + {{\left( {{{{\rm{F}}{{\rm{L}}_{i,t}}} \over {{\rm{T}}{{\rm{D}}_{i,t}}}}} \right)}^2}} \hfill \cr {{\rm{Loanconce}}{{\rm{n}}_{i,t}} = {\rm{(}}S{S_{i,t}} - 1/5)/(1 - 1/5)} \hfill \cr }

TD is the total liabilities of the firm; TC is the trade credit of the firm, which is the sum of accounts payable, notes payable and advances; BL is the bank loans of the firm; FL is the financing lease of the firm; BP is bonds payable of the firm; Other is other debts of the firm. Loancen which is obtained by standardising SS. Loanconcens are distributed between 0 and 1. The larger the Loanconcen value, the higher the degree of debt concentration.

Intermediary variable 2: product market competitive advantage (RPCM)

Referring to Kale and Loon (2011) [12], this paper uses Lerner index ranking to characterise product market competitive advantages. Lerner index (PCM) is calculated as follows:

PCM = (Operating income – Operating cost – Cost of sales – Overheads)/Operating income

Lerner index ranking (RPCM) is ranked according to the PCM value of the firm in the industry from the min to the max, firms in the industry were divided into 10 groups according to this order. RPCM of firms in each group were assigned values from 1 to 10. The higher the RPCM value is, the stronger the bargaining power and more competitive advantage of the firm in the product market.

Controls variables

The following sets of control variables probably affect FDR. Firm's characteristics variables: Firm's scale (Size), firm's age (Age). Firm's financial characteristics variables: Profitability (ROA), management expense ratio (Overhead), non-debt tax shield (NDT), market-to-book ratio of equity (MTB), adequacy of free cash flow (Cash), noncurrent assets to total assets ratio (PPE), the shareholding ratio of the top five shareholders (Lncon), the growth rate of operating income (Growth) and stock returns (RET). Board of directors characteristics variables, independent directors ratio (Indratio), CEO duality (Duality). We also control ΣIndustry (ΣYear) is a set of industry (year) dummy variables. Definitions of other relevant main variables are shown in Table 1.

Variable definitions.

Variables classification Variable names Variable definitions

Explained variables FDR Z_score is calculated in section 3.2.1.
Explanatory variables CSR CSR score is obtained from the CSR report of listed companies published in Hexun.com.
Mediating Loanconcen Loanconcen is calculated in the above model section 3.2.3.
Variables RPCM The value of RPCM ranges from 1 to 10. For details, see above.
Size Natural logarithm of total assets.
Roa Roa is pretax operating income divided by total assets.
Age Age is equal to inspection year minus listing year.
Overhead Overhead is the management expense happened during the year divided by total assets.
Control variables NDTS NDTS is the ratio of current year depreciation and amortisation to total assets.
MTB MTB is the growth rate of firms and is the ratio of the market value of equity to the book value of equity.
Cash Cash is the adequacy of free cash flow = (Net cash flow from operating activities + Net cash flow from investment activities)/Total assets at beginning of year
PPE The ratio of the total noncurrent asset to total asset.
Lncon Lncon is the combined shareholding of the top five shareholders.
Growth Growth = (Operating income for current year − Operating income for previous year)/Operating income for previous year
RET RET is the firm's average monthly stock return during the year.
Indratio The ratio of the number of independent directors to the number of directors.
Duality Duality is a dummy variable that equals 1 if the same person holds the post of chairman and general manager and 0 otherwise.

NDT, non-debt tax shield.

Research model

According to Baron and Kenny (1986) [13] proposed mediating effect test method and procedure, this paper constructs the research model according to Figure 1.

FDRi,t=α0+α1CSRi,t+Controlsi,t+εi,t {\rm{FD}}{{\rm{R}}_{i,t}} = {\alpha _0} + {\alpha _1}{\rm{CS}}{{\rm{R}}_{i,t}} + {\rm{Control}}{{\rm{s}}_{i,t}} + {\varepsilon _{i,t}} Mediatori,t=β0+β1CSRi,t+Controlsi,t+εi,t {\rm{Mediato}}{{\rm{r}}_{i,t}} = {\beta _0} + {\beta _1}{\rm{CS}}{{\rm{R}}_{i,t}} + {\rm{Control}}{{\rm{s}}_{i,t}} + {\varepsilon _{i,t}} FDRi,t=γ0+γ1CSRi,t+γ2Mediatori,t+Controlsi,t+εi,t {\rm{FD}}{{\rm{R}}_{i,t}} = {\gamma _0} + {\gamma _1}{\rm{CS}}{{\rm{R}}_{i,t}} + {\gamma _2}{\rm{Mediato}}{{\rm{r}}_{i,t}} + {\rm{Control}}{{\rm{s}}_{i,t}} + {\varepsilon _{i,t}}

The explained variable in the model (1) and model (3) is FDR, namely Z_score, explanatory variables are CSR, mediator variables are degree of debt concentration Loanconcen and product market competitive advantage RPCM, respectively. The explained variables in the model (2) were the mediator variables Loanconcen and RPCM, the explained variable was CSR. The mediation effect test process is as follows: Step 1, the coefficient α1 in the model (1) represents the total effect of CSR fulfillment on debt risk. If α1 is statistically significant, the test of the model (2) continues, if α1 is not significant, the test is stopped. Step 2: If the coefficient β1 in the model (2) is significantly means Loanconcen and RPCM are mediating variables of CSR fulfillment affecting debt risk, if β1 is not significant, the test is stopped. In step 3, the coefficient γ1 of the model (3) measures the direct effect of CSR fulfilment on debt risk if the coefficient γ1 is not significant, but the coefficient γ2 is significant, it means that the Loanconcen and RPCM exist complete mediating effect between CSR fulfillment and debt risk if the coefficients γ1 and γ2 are both significant, it indicates that the Loanconcen and RPCM only have partial mediating effects between CSR fulfilment and debt risk. Moreover, the Sgmediation command in STATA15 software was used in this paper to conduct the Sobel test and verify the existence of the mediation effect from multiple perspectives.

Fig. 1

Mediation effect testing steps.

Empirical results
Variable descriptive statistics

Table 2 is the descriptive statistics of the main variables. Altman (1968) [10] pointed out that when Z_score is greater than 2.99, it means that the financial status of the firm is in good health and the probability of debt risk is low. When Z_score is less than 1.81, it indicates that the firm has latent debt risk. When Z_score is between 1.81 and 2.99, it is called ‘grey area’, which indicates that the financial situation of firms is in an unstable state. This paper's main explained variable Z_score's mean value is 6.2083, the maximum value is 63.7491, the minimum value is 0.1730, the 25% percentile is 1.9552, the median value is 3.5302, and the standard deviation is 8.3996. Indicate that the debt risk faced by different firms is quite different, at least 25% of firms are faced with debt risk. The full score of CSR fulfilment published on Hexun.com is 100. According to this table, the mean and median values of CSR are 25.2250 and 22.1200 respectively, with the maximum value of 73.8200 and the minimum value of −2.8200, indicating that the degree of CSR fulfillment in China needs to be further improved. The mean and median values of Loanconcen are 0.3291 and 0.2874 respectively, with a standard deviation of 0.1662, which means the degree of debt concentration between firms varies greatly. The mean and median values of RPCM are 5.4278 and 5.0000 respectively, with a standard deviation of 2.7644, which means the degree of debt concentration between firms varies greatly, these values are similar to those of previous studies.

Descriptive statistics.

Variables N Minimum Mean p25 Median p75 Std. Dev Maximum

Z_score 20097 0.1730 6.2083 1.9552 3.5302 6.7077 8.3996 63.7491
Loanconcen 20097 0.0947 0.3291 0.2069 0.2874 0.4076 0.1662 0.9573
RPCM 20097 1.0000 5.4278 3.0000 5.0000 8.0000 2.7644 10.0000
CSR 20097 −2.8200 25.2250 16.5400 22.1200 28.1200 16.4951 73.8200
Size 20097 19.4961 22.2871 21.3812 22.1076 23.0129 1.2774 26.0740
Roa 20097 −0.2147 0.0379 0.0138 0.0348 0.0632 0.0552 0.2069
Age 20097 2.0000 10.8679 5.0000 10.0000 16.0000 6.6695 25.0000
Overhead 20097 0.0042 0.0440 0.0244 0.0387 0.0573 0.0279 0.1627
NDTS 20097 0.0007 0.0240 0.0123 0.0213 0.0327 0.0156 0.0765
MTB 20097 0.5909 3.3956 1.6771 2.5835 4.1147 2.7960 19.8846
Cash 20097 −0.5918 −0.0207 −0.0743 −0.0053 0.0489 0.1270 0.3322
PPE 20097 0.0019 0.2202 0.0905 0.1870 0.3155 0.1646 0.7149
Lncon 20097 0.2002 0.5257 0.4145 0.5256 0.6345 0.1507 0.8872
Growth 20097 −0.5576 0.1908 −0.0111 0.1124 0.2727 0.4569 3.3170
RET 20097 −0.0864 0.0110 −0.0173 0.0062 0.0321 0.0421 0.2276
Indratio 20097 0.3333 0.3747 0.3333 0.3333 0.4286 0.0537 0.5714
Duality 20097 0.0000 0.2395 0.0000 0.0000 0.0000 0.4268 1.0000

NDT, non-debt tax shield.

CSR fulfilment and debt risk: an analysis of mediating effect based on debt concentration and product market competitive advantage

Table 3 reports the regression results of the effect of CSR fulfillment on debt risk by affecting the degree of debt concentration and product market competitive advantage. Column (1) is step 1 for mediating effect test, to examine whether the firms’ fulfilment of CSR have effect on debt risk, the estimated coefficient of CSR in the regression result is −0.0132, significantly at the 1% level, it shows that with the improvement of the level of CSR fulfilment, the lower the debt risk the firm faces, the empirical test results support the view of hypothesis H1. Column (2) and column (4) are step 2 of mediating effect test, whether the firms’ fulfilment of CSR has an effect on debt concentration and product market competitive advantage were tested respectively, the estimated coefficient of CSR and Loanconcen is −0.0112, the estimated coefficient of CSR and RPCM is 0.0186, both of them were statistically significant at 1% level, which indicates that the fulfilment of CSR can obviously reduce the degree of debt concentration and enhance the firm's competitive advantage in the product market. Column (3) and column (5) are step 3 of the mediation effect test, the estimated coefficient of intermediary variable Loanconcen and Z_score is 0.2321, and the estimated coefficient of intermediary variable RPCM and Z_score is −0.1209, both of them were significant at 1% level, and it shows that the degree of debt concentration and the competitive advantage of a product market are the key factors affecting the debt risk of firms. In Column (3) and column (5), although the estimated coefficients of CSR and Z_score are −0.0106 and −0.0110 respectively, they are still significant at the 1% level. However, compared with the estimated coefficient of CSR and Z_score in column (1), the estimated coefficient values are changed. The above test results show that the debt concentration and product market competitive advantage have partial mediating effects between the fulfillment of CSR and debt risk. So the influencing mechanism between CSR fulfillment and debt risk is confirmed. Namely, ‘CSR fulfillment-debt concentration/product market competitive advantage-debt risk’, it indicates that CSR fulfilment can reduce the debt risk by reducing the concentration of corporate debt and enhancing the firm competitive advantage in the product market. In addition, to verify the debt concentration degree and product market competitive advantage exit mediating effects between CSR performance and debt risk more accurately. Sobel tests are also carried out in this paper, The Z test values in column (3) and column (5) are −2.7600 and −5.2780, respectively, which are significant at a 1% level. The empirical test results support H1, H2 and H3.

CSR fulfillment and debt risk: based on the mediating effect test of debt concentration and product market competitive advantage (take a negative number of Z_score).

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (4) (5)

CSR −0.0132*** (−3.67) −0.0112*** (−2.79) −0.0106*** (−3.10) 0.0186*** (15.82) −0.0110*** (−3.03)
Loanconcen 0.2321*** (5.18)
RPCM −0.1209*** (−5.60)
Size 1.8089*** (35.32) −0.0408*** (−34.84) 1.5572*** (29.82) −0.0102 (−0.61) 1.8076*** (35.32)
Roa −34.1504*** (−33.24) 0.2331*** (9.93) −32.7111*** (−32.08) 25.8148*** (76.87) −31.0300*** (−26.56)
Age 0.0560*** (6.40) 0.0013*** (6.26) 0.0637*** (7.35) −0.0668*** (−23.35) 0.0479*** (5.41)
Overhead 4.0819* (1.92) −0.2695*** (−5.55) 2.4178 (1.15) −12.2106*** (−17.57) 2.6060 (1.22)
NDTS 13.7700*** (2.78) −1.0049*** (−8.88) 7.5650 (1.54) −8.4793*** (−5.23) 12.7451** (2.57)
MTB −0.8100*** (−35.97) 0.0019*** (3.77) −0.7980*** (−35.78) 0.0516*** (7.01) −0.8038*** (−35.68)
Cash −1.6649*** (−4.17) 0.1234*** (13.53) −0.9028** (−2.27) −0.4065*** (−3.11) −1.7141*** (−4.29)
PPE 3.2902*** (6.69) −0.0426*** (−3.79) 3.0273*** (6.22) 0.8900*** (5.54) 3.3978*** (6.91)
Lncon −3.7918*** (−10.84) 0.1463*** (18.30) −2.8884*** (−8.27) −0.0607 (−0.53) −3.7991*** (−10.87)
Growth 1.0812*** (9.92) −0.0097*** (−3.91) 1.0212*** (9.46) 0.1997*** (5.61) 1.1054*** (10.14)
RET −9.9885*** (−5.90) −0.0463 (−1.20) −10.2741*** (−6.13) 0.0822 (0.15) −9.9785*** (−5.90)
Indratio −3.4468*** (−3.86) −0.0472** (−2.31) −3.7380*** (−4.23) −0.3819 (−1.31) −3.4929*** (−3.91)
Duality −0.4317*** (−3.73) 0.0031 (1.18) −0.4124*** (−3.59) 0.2491*** (6.58) −0.4016*** (−3.46)
Constant −39.1238*** (−32.53) 1.2306*** (44.79) −31.5255*** (−25.25) 4.9456*** (12.58) −38.5260*** (−31.93)
Year/Industry Yes Yes Yes Yes Yes
N 20097 20097 20097 20097 20097
Adj-R2 0.3661 0.1545 0.3787 0.3748 0.3670
Z −2.7600*** −5.2780***
Sobel Test Std Err 0.0005 0.0004
P 0.0058 1.305e-07

Note: ***, ** and * are significant at 1%, 5% and 10% levels respectively, the same below. NDT, non-debt tax shield.

Robustness test
Replace explanatory variables, mediation variables and explained variables

To ensure the robustness of the empirical results, explanatory variables, intermediate variables and explained variables were replaced at the same time. Referring to the method of Tykvova and Borell (2012), Z_score1 is used to replace the original debt risk index Z_score. The calculation method of Z_score1 is as follows:

Z_score = 0.717 × (Operating funds/Total asset) + 0.847 × (Retained earnings/Total asset) + 3.107× (Earnings before interest and tax/Total asset) + 0.420 × (Value of equity/Value of liability) + 0.998 × (Sales revenue/Total asset)

For facilitating interpretation, Z_score1 in this paper has been negative in the robustness tests.

i_CSR is the industry adjusted CSR, measured as CSR less the median value of CSR for all firms in the same industry. We use i_CSR to replace the CSR in the robust test. Reference the method of Li et al. (2021) [10] to replace the original debt concentration degree index Loanconcen with Loantype. Loantype represents the number of different types of debt in the firm, only those with a debt ratio greater than 5% are included. The higher the value of Loantype is, the lower the debt concentration of the firm is, and vice versa. We also use PCM to replace the original product market competitive advantage index RPCM.

The results of the robustness test are shown in Table 4, column (1) is the total effect showing that the coefficient of i_CSR and Z_score1 is −0.0087, which is significant at the 1% level. It shows that the total effect of CSR fulfilment has a restraining influence on debt risk is established. Columns (2) to (3) report the mediating effect test results of debt concentration. The regression results in column (3) show that after adding Loantype the estimated coefficient between i_CSR and Z_score1 changes obviously, but is still significantly negative at the 1% level, it shows that the degree of debt concentration exists partial intermediary effect. Columns (4) to (5) report the mediation effect test results of product market competitive advantage, the column (5) shows the regression result after dum_PCM is added, the estimated coefficient between i_CSR and Z_score1 changes obviously, but is still significantly negative at 1% level, it shows that the product market competitive advantage exist partial intermediary effect. In addition, the Sobel method is also used for mediating effect testing, z test values in columns (3) and (5) are −2.5610 and −2.4540 respectively, which are both significant at 5% level, this is consistent with the main regression results we described earlier.

Robustness test after replace explanatory variables, mediation variables and explained variables.

Variables Mediator: Loantype Mediator: dum_PCM

Z_score1 Loantype Z_score1 dum_PCM Z_score1

(1) (2) (3) (4) (5)

i_CSR −0.0087*** (−3.48) 0.0007** (2.57) −0.0080*** (−3.22) 0.0007*** (11.78) −0.0082*** (−3.26)
Loantype −1.0030*** (−6.95)
dum_PCM −0.7536** (−2.51)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 20097 20097 20097 20097 20097
Adj-R2 0.3688 0.3432 0.4090 0.4055 0.3689
Z −2.5610** −2.4540**
Sobel test Std err 0.0006 0.0002
P 0.0104 0.0141

Note: The control variables in Table 4 are the same as those in Table 3.

The bootstrap method was used to test the mediation effect

To ensure the robustness of the conclusions of this study, the bootstrap method, the latest mediation test programme proposed internationally in recent years, is used to test the mediation effect of debt concentration and product market competitive advantage again. Table 5 is the Bootstrap test for the degree of debt concentration. Table 6 is the Bootstrap test for the product market competitive advantage. _bs_1 is the indirect effect, _bs_2 is the direct effect. Both in Tables 5 and 6 the _bs_1 indirect effect does not include 0 in the 95% confidence interval, representing the degree of debt concentration and product market competitive advantage plays an intermediary role between CSR fulfilment and debt risk. Therefore, the empirical research conclusion of this paper is robust.

Bootstrap method was used to test the mediation effect of debt concentration.

Observed coef. Bias Bootstrap std. err. 95% Conf. interval
_bs_1 (ind_eff) −0.00141562 0.0000239 0.00050512 −0.0025358 −0.000406 (P)
−0.0217125 −0.0003436 (BC)
_bs_2 (dir_eff) −0.01463271 0.0001333 0.00349908 −0.0024313 −0.0079729 (P)
−0.0212825 −0.007886 (BC)

Note: P is a confidence interval, BC is a confidence interval after deviation correction.

Bootstrap method was used to test the mediation effect of product market competitive advantage.

Observed coef. Bias Bootstrap std. err. 95% Conf. interval
_bs_1 (ind_eff) −0.0047 4.01E-05 0.000544 −0.00587 −0.0036 (P)
−0.01384 −0.00098 (P)
_bs_2 (dir_eff) −0.0073 0.000111 0.003209 −0.00591 −0.00364 (BC)
−0.01402 −0.00129 (BC)

Note: P is a confidence interval, BC is a confidence interval after deviation correction.

Further study
Grouping tests based on property rights

In firms with different property rights, there are great differences in their willingness and tendency to fulfil CSR and ability to deal with debt risks, in this circumstance, the mediating effect of the degree of debt concentration and the product market competitive advantage between the CSR fulfillment and debt risk would quiet difference. According to the property rights of firms, the samples are divided into state-owned firms group and private firms group. Table 7 shows the empirical test results of the mediation effect for state-owned firms, column (1) of Table 7 shows that the estimation coefficients between CSR and Z_score are significantly negative, it shows that fulfilling CSR by state-owned firms can reduce the debt risk the firm faced.

Sample of state-owned enterprises.

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (4) (5)

CSR −0.0175*** (−5.53) −0.0002 (−1.49) −0.0180*** (−5.73) 0.0172*** (11.10) −0.0178*** (−5.59)
Loanconcen 3.1501*** (10.04)
RPCM 0.0185 (0.83)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 8350 8350 8350 8350 8350
Adj-R2 0.3324 0.1644 0.3403 0.3881 0.3324
Z −1.4780 0.8238
Sobel test Std err 0.0004 0.0004
P 0.1394 0.4081

Note: The control variables in Table 7 are the same as those in Table 3.

Column (2) is the second step to test the mediating effect of the degree of debt concentration, and the estimated coefficients between Loanconcen and CSR are not significant, meanwhile, the Z value and P-value in the Sobel test are −1.4780 and 0.1394 respectively, and it shows that the mediation effect of degree of debt concentration does not exist in state-owned firms. Column (5) is the third step of testing the intermediary effect of product market competitive advantage, the estimation coefficient of RPCM and Z_score is not significant, and the Z value and P-value in the Sobel test are 0.8238 and 0.4081 respectively, as it shows that the mediation effect of product market competitive advantage does not exist in state-owned firms. The above empirical test results indicate that the CSR fulfillment by state-owned firms cannot reduce debt risk by dispersing the degree of debt concentration and improving the competitive advantage in the product market.

Table 8 shows the empirical test results of the mediation effect of the private firms, the estimated coefficient between CSR and Z_score in column (1) of Table 8 is −0.0136, which is significant at the 5%, it shows that fulfilling CSR in private firms can mitigate the debt risk. The estimated coefficients of Loanconcen and CSR in column (2) are significantly negative at the 1% level. Column (3) the estimation coefficient between CSR and Z_score is not significant. Meanwhile, the Z value of the Sobel test is −5.3310, which is significant at the level of 1%, it shows that the degree of debt concentration has a complete intermediary effect in private firms. The estimated coefficient of RPCM and CSR in column (4) is 0.0219, which is significant at the 1% level, combined with the test results of column (5), the estimation coefficient between CSR and Z_score is not significant, Z-value of Sobel test is −5.3950, which is significant at the level of 1%. It shows that the product market competitive advantage in private firms has a complete intermediary effect. The above empirical test results indicate that the CSR fulfilment of private firms can reduce debt risk by dispersing the degree of debt concentration and improving the competitive advantage of the product market.

Sample of private enterprises.

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (6) (7)

CSR −0.0136** (−2.14) −0.0232*** (−11.35) −0.0089 (−1.03) 0.0219*** (12.40) −0.0092 (−1.44)
Loanconcen 0.2060*** (6.92)
RPCM −0.2000*** (−5.99)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 11646 11646 11646 11646 11646
Adj-R2 0.3688 0.1675 0.3840 0.3809 0.3707
Z −5.3310*** −5.3950***
Sobel test Std err 0.0010 0.0008
P 5.763e-11 6.850e-08

Note: The control variables in Table 8 are the same as those in Table 3.

The reason is that state-owned firms have dual operation objectives under the institutional background of China, the first objective is to seek profitability and development for itself, and the second objective is to help local governments share certain social responsibilities, assist local governments in maintaining social stability, promote employment and local economic development, so local governments usually lend a helping hand with tax reduction and exemption, government subsidies and even debt forgiveness to state-owned firms. The protection of ‘fatherism’ behaviour by local government such as policy support and regional barriers, could destruct the positive effects of the competition mechanism so that state-owned firms will no longer be committed to cultivating competitive advantages to enhance competitiveness, and the heavy burden of CSR will also squeeze out the resources that should have been used to enhance the competitive advantage of the product market in state-owned firms. By contrast, private firms do not need to bear the policy burden because there is no natural connection between them and the government. Therefore, private firms can distinguish themselves from their competitors by establishing a reputation through their CSR fulfilment, to deliver positive signals to the government and other key stakeholders to obtain scarce credit resources and obtain the support of stakeholders in the fierce product market competition to alleviate the debt risks.

Grouping tests based on regions

Enterprises in different regions, no matter the degree of economic activity, the maturity of the financial market or the intensity of market competition, therefore, the impact of CSR fulfillment on debt risk through debt concentration and product market competitive advantage will also be greatly different. In this paper, the sample is divided into eastern regions, central and western regions according to the location of enterprise registration. Table 9 reports the mediating effect of test results of firms domiciled in the eastern regions, and Table 10 shows the mediating effect of test results of the firms registered in central and western regions. As can be seen from column (1) of Table 9, the estimated coefficient between CSR and Z_score is significantly negative at the 5% level, and the estimated coefficients of Loanconcen and CSR in column (2) are significantly negative at the 1% level, the estimation coefficient between CSR and Z_score is not significant in column (3), meanwhile, the Z-value of Sobel test is −4.5060 which is significant at the level of 1%, indicating that the degree of debt concentration has a complete intermediary effect on firms located in eastern regions of China. Table 9 column (4) reports the second step of testing the mediating effect of product market competitive advantage, the estimated coefficient of RPCM and CSR is significantly positive at the 1% level, combined with the test results of column (5), it can be seen that the estimation coefficient between CSR and Z_score is not significant, while that between RPCM and Z_score is significant at 1% level. The Z-value of the Sobel test is −5.2470, significant at the 1% level, the results show that there also exists a complete mediating effect of product market competitive advantage among firms in eastern China.

Sample of firms registered in the eastern region.

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (4) (5)

CSR −0.0100** (−2.17) −0.0303*** (−9.54) −0.0086 (−1.34) 0.0201*** (14.14) −0.0069 (−1.48)
Loanconcen 0.2834*** (6.02)
RPCM −0.1559*** (−5.65)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 13755 13755 13755 13755 13755
Adj-R2 0.3606 0.1750 0.3723 0.3743 0.3620
Z −4.5060*** −5.2470***
Sobel test Std err 0.0006 0.0006
P 2.531e-06 1.542e-07

Note: The control variables in Table 9 are the same as those in Table 3.

Sample of firms registered in the central and western region.

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (4) (5)

CSR −0.0194*** (−3.46) −0.0142*** (−4.21) −0.0153*** (−3.08) 0.0162*** (7.75) −0.0183*** (−3.24)
Loanconcen 0.2237*** (6.28)
RPCM −0.0685** (−2.03)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 6342 6342 6342 6342 6342
Adj-R2 0.3843 0.1230 0.3986 0.3870 0.3846
Z −2.2020*** 1.9640**
Sobel test Std err 0.0009 0.0006
P 0.0013 0.0496

Note: The control variables in Table 10 are the same as those in Table 3.

As can be seen from column (1) of Table 10, the estimated coefficient between CSR and Z_score is significantly negative at the 1% level, column (2) lists the second step of the mediating effect test of the degree of debt concentration, the estimated coefficients of Loanconcen and CSR is also significant negative at the 1% level, the Z value of Sobel test is −2.2020 and the P-value of Sobel test is 0.0013, it shows that partial mediating effect of degree of debt concentration exists in the firms which were registered in middle and western regions. Table 10 column (4) reports the second step of testing the mediating effect of product market competitive advantage, the estimated coefficient of RPCM and CSR is significantly positive at the 1% level.

Compared with column (1), the estimated coefficient between CSR and Z_score changes significantly in column (5), the Z value of the Sobel test is 1.9640, and the P-value of the Sobel test is 0.0496, the results show that the product market competitive advantage has a partial mediating effect to the firms located in the central and western regions.

The above-grouped test results show that CSR fulfilment reduces debt risk more obviously in eastern regions by dispersing the concentration of debt and improving the competitive advantage of the product market.

The higher legal level that persists in the eastern region can make the firm's debt default behaviour be punished in time and provide a strong guarantee for the performance of the debt obligation by borrowers. At the same time, the process of marketisation in the eastern region is faster, the level of economic development is higher, and the competition among enterprises is also becoming more intense. The public pays more attention to the performance of corporate social responsibility which is conducive to the realisation of differentiation strategy and improvement of the competitiveness of firms in the product market, playing a better role in restraining the debt risk of firms.

The central and western regions have a low level of economic development marketisation process and legalisation process are relatively backward, firms are subject to more government intervention, and the government pays more attention to local economic development than CSR. The difficulty of debt financing of firms in the central and western regions not only depends on the fulfilment of CSR but also depends on the ‘government-firm relationship’ and ‘bank-firm relationship’, the financing channels of firms are relatively single, the degree of market competition is also relatively low.

Research conclusions and policy recommendations

In general, the research conclusions of this paper confirm that CSR fulfillment has an inhibitory effect on debt risk, and use the mediation effect model to analyse the internal mechanism of CSR fulfilment affecting on debt risk, it also expands the research on the economic consequences of CSR fulfillment. The research of this paper also shows that CSR fulfillment can enable firms to obtain debt financing from more channels and make the debt structure more decentralised, it is helpful to understand the formation and determinants of capital structure, and it is found that the degree of debt concentration is an important mediating factor between the fulfillment of CSR and debt risk, has certain theoretical significance. Banks and other financial institutions can incorporate corporate social responsibility performance into their credit evaluation system to help banks build a scientific credit decision-making system. In view of the present situation of CSR, the fulfilment level is generally low in China. The research conclusions of this paper also help the firm to realise that actively fulfilling CSR can enable itself to obtain high-quality resources needed for survival and development on their own and thus establish competitive advantages. Finally, for policymakers, it is necessary to establish and improve the supervision and evaluation mechanism of CSR fulfilment. Policy makers need to improve the information environment, dredge the circulation channel between the enterprise and the resource provider, guide advantageous resources to flow to firms that perform CSR well, and help firms and the whole society achieve sustainable development. Therefore, the research conclusion of this paper has certain practical guiding significance for enterprises, capital providers and policy makers.

Fig. 1

Mediation effect testing steps.
Mediation effect testing steps.

CSR fulfillment and debt risk: based on the mediating effect test of debt concentration and product market competitive advantage (take a negative number of Z.score).

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (4) (5)

CSR −0.0132*** (−3.67) −0.0112*** (−2.79) −0.0106*** (−3.10) 0.0186*** (15.82) −0.0110*** (−3.03)
Loanconcen 0.2321*** (5.18)
RPCM −0.1209*** (−5.60)
Size 1.8089*** (35.32) −0.0408*** (−34.84) 1.5572*** (29.82) −0.0102 (−0.61) 1.8076*** (35.32)
Roa −34.1504*** (−33.24) 0.2331*** (9.93) −32.7111*** (−32.08) 25.8148*** (76.87) −31.0300*** (−26.56)
Age 0.0560*** (6.40) 0.0013*** (6.26) 0.0637*** (7.35) −0.0668*** (−23.35) 0.0479*** (5.41)
Overhead 4.0819* (1.92) −0.2695*** (−5.55) 2.4178 (1.15) −12.2106*** (−17.57) 2.6060 (1.22)
NDTS 13.7700*** (2.78) −1.0049*** (−8.88) 7.5650 (1.54) −8.4793*** (−5.23) 12.7451** (2.57)
MTB −0.8100*** (−35.97) 0.0019*** (3.77) −0.7980*** (−35.78) 0.0516*** (7.01) −0.8038*** (−35.68)
Cash −1.6649*** (−4.17) 0.1234*** (13.53) −0.9028** (−2.27) −0.4065*** (−3.11) −1.7141*** (−4.29)
PPE 3.2902*** (6.69) −0.0426*** (−3.79) 3.0273*** (6.22) 0.8900*** (5.54) 3.3978*** (6.91)
Lncon −3.7918*** (−10.84) 0.1463*** (18.30) −2.8884*** (−8.27) −0.0607 (−0.53) −3.7991*** (−10.87)
Growth 1.0812*** (9.92) −0.0097*** (−3.91) 1.0212*** (9.46) 0.1997*** (5.61) 1.1054*** (10.14)
RET −9.9885*** (−5.90) −0.0463 (−1.20) −10.2741*** (−6.13) 0.0822 (0.15) −9.9785*** (−5.90)
Indratio −3.4468*** (−3.86) −0.0472** (−2.31) −3.7380*** (−4.23) −0.3819 (−1.31) −3.4929*** (−3.91)
Duality −0.4317*** (−3.73) 0.0031 (1.18) −0.4124*** (−3.59) 0.2491*** (6.58) −0.4016*** (−3.46)
Constant −39.1238*** (−32.53) 1.2306*** (44.79) −31.5255*** (−25.25) 4.9456*** (12.58) −38.5260*** (−31.93)
Year/Industry Yes Yes Yes Yes Yes
N 20097 20097 20097 20097 20097
Adj-R2 0.3661 0.1545 0.3787 0.3748 0.3670
Z −2.7600*** −5.2780***
Sobel Test Std Err 0.0005 0.0004
P 0.0058 1.305e-07

Variable definitions.

Variables classification Variable names Variable definitions

Explained variables FDR Z_score is calculated in section 3.2.1.
Explanatory variables CSR CSR score is obtained from the CSR report of listed companies published in Hexun.com.
Mediating Loanconcen Loanconcen is calculated in the above model section 3.2.3.
Variables RPCM The value of RPCM ranges from 1 to 10. For details, see above.
Size Natural logarithm of total assets.
Roa Roa is pretax operating income divided by total assets.
Age Age is equal to inspection year minus listing year.
Overhead Overhead is the management expense happened during the year divided by total assets.
Control variables NDTS NDTS is the ratio of current year depreciation and amortisation to total assets.
MTB MTB is the growth rate of firms and is the ratio of the market value of equity to the book value of equity.
Cash Cash is the adequacy of free cash flow = (Net cash flow from operating activities + Net cash flow from investment activities)/Total assets at beginning of year
PPE The ratio of the total noncurrent asset to total asset.
Lncon Lncon is the combined shareholding of the top five shareholders.
Growth Growth = (Operating income for current year − Operating income for previous year)/Operating income for previous year
RET RET is the firm's average monthly stock return during the year.
Indratio The ratio of the number of independent directors to the number of directors.
Duality Duality is a dummy variable that equals 1 if the same person holds the post of chairman and general manager and 0 otherwise.

Descriptive statistics.

Variables N Minimum Mean p25 Median p75 Std. Dev Maximum

Z_score 20097 0.1730 6.2083 1.9552 3.5302 6.7077 8.3996 63.7491
Loanconcen 20097 0.0947 0.3291 0.2069 0.2874 0.4076 0.1662 0.9573
RPCM 20097 1.0000 5.4278 3.0000 5.0000 8.0000 2.7644 10.0000
CSR 20097 −2.8200 25.2250 16.5400 22.1200 28.1200 16.4951 73.8200
Size 20097 19.4961 22.2871 21.3812 22.1076 23.0129 1.2774 26.0740
Roa 20097 −0.2147 0.0379 0.0138 0.0348 0.0632 0.0552 0.2069
Age 20097 2.0000 10.8679 5.0000 10.0000 16.0000 6.6695 25.0000
Overhead 20097 0.0042 0.0440 0.0244 0.0387 0.0573 0.0279 0.1627
NDTS 20097 0.0007 0.0240 0.0123 0.0213 0.0327 0.0156 0.0765
MTB 20097 0.5909 3.3956 1.6771 2.5835 4.1147 2.7960 19.8846
Cash 20097 −0.5918 −0.0207 −0.0743 −0.0053 0.0489 0.1270 0.3322
PPE 20097 0.0019 0.2202 0.0905 0.1870 0.3155 0.1646 0.7149
Lncon 20097 0.2002 0.5257 0.4145 0.5256 0.6345 0.1507 0.8872
Growth 20097 −0.5576 0.1908 −0.0111 0.1124 0.2727 0.4569 3.3170
RET 20097 −0.0864 0.0110 −0.0173 0.0062 0.0321 0.0421 0.2276
Indratio 20097 0.3333 0.3747 0.3333 0.3333 0.4286 0.0537 0.5714
Duality 20097 0.0000 0.2395 0.0000 0.0000 0.0000 0.4268 1.0000

Sample of firms registered in the central and western region.

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (4) (5)

CSR −0.0194*** (−3.46) −0.0142*** (−4.21) −0.0153*** (−3.08) 0.0162*** (7.75) −0.0183*** (−3.24)
Loanconcen 0.2237*** (6.28)
RPCM −0.0685** (−2.03)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 6342 6342 6342 6342 6342
Adj-R2 0.3843 0.1230 0.3986 0.3870 0.3846
Z −2.2020*** 1.9640**
Sobel test Std err 0.0009 0.0006
P 0.0013 0.0496

Bootstrap method was used to test the mediation effect of product market competitive advantage.

Observed coef. Bias Bootstrap std. err. 95% Conf. interval
_bs_1 (ind_eff) −0.0047 4.01E-05 0.000544 −0.00587 −0.0036 (P)
−0.01384 −0.00098 (P)
_bs_2 (dir_eff) −0.0073 0.000111 0.003209 −0.00591 −0.00364 (BC)
−0.01402 −0.00129 (BC)

Sample of private enterprises.

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (6) (7)

CSR −0.0136** (−2.14) −0.0232*** (−11.35) −0.0089 (−1.03) 0.0219*** (12.40) −0.0092 (−1.44)
Loanconcen 0.2060*** (6.92)
RPCM −0.2000*** (−5.99)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 11646 11646 11646 11646 11646
Adj-R2 0.3688 0.1675 0.3840 0.3809 0.3707
Z −5.3310*** −5.3950***
Sobel test Std err 0.0010 0.0008
P 5.763e-11 6.850e-08

Sample of firms registered in the eastern region.

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (4) (5)

CSR −0.0100** (−2.17) −0.0303*** (−9.54) −0.0086 (−1.34) 0.0201*** (14.14) −0.0069 (−1.48)
Loanconcen 0.2834*** (6.02)
RPCM −0.1559*** (−5.65)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 13755 13755 13755 13755 13755
Adj-R2 0.3606 0.1750 0.3723 0.3743 0.3620
Z −4.5060*** −5.2470***
Sobel test Std err 0.0006 0.0006
P 2.531e-06 1.542e-07

Bootstrap method was used to test the mediation effect of debt concentration.

Observed coef. Bias Bootstrap std. err. 95% Conf. interval
_bs_1 (ind_eff) −0.00141562 0.0000239 0.00050512 −0.0025358 −0.000406 (P)
−0.0217125 −0.0003436 (BC)
_bs_2 (dir_eff) −0.01463271 0.0001333 0.00349908 −0.0024313 −0.0079729 (P)
−0.0212825 −0.007886 (BC)

Robustness test after replace explanatory variables, mediation variables and explained variables.

Variables Mediator: Loantype Mediator: dum_PCM

Z_score1 Loantype Z_score1 dum_PCM Z_score1

(1) (2) (3) (4) (5)

i_CSR −0.0087*** (−3.48) 0.0007** (2.57) −0.0080*** (−3.22) 0.0007*** (11.78) −0.0082*** (−3.26)
Loantype −1.0030*** (−6.95)
dum_PCM −0.7536** (−2.51)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 20097 20097 20097 20097 20097
Adj-R2 0.3688 0.3432 0.4090 0.4055 0.3689
Z −2.5610** −2.4540**
Sobel test Std err 0.0006 0.0002
P 0.0104 0.0141

Sample of state-owned enterprises.

Variables Mediator: Loanconcen Mediator: RPCM

Z_score Loanconcen Z_score RPCM Z_score

(1) (2) (3) (4) (5)

CSR −0.0175*** (−5.53) −0.0002 (−1.49) −0.0180*** (−5.73) 0.0172*** (11.10) −0.0178*** (−5.59)
Loanconcen 3.1501*** (10.04)
RPCM 0.0185 (0.83)
Controls Yes Yes Yes Yes Yes
Year/Industry Yes Yes Yes Yes Yes
N 8350 8350 8350 8350 8350
Adj-R2 0.3324 0.1644 0.3403 0.3881 0.3324
Z −1.4780 0.8238
Sobel test Std err 0.0004 0.0004
P 0.1394 0.4081

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