Asian Journal of Business Ethics· 2026Q1
Corporate social responsibility and credit spreads: evidence from family firms in China
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Short summary
Corporate social responsibility (CSR) is negatively associated with bond credit spreads in Chinese family firms, with technical CSR (primary stakeholders) showing a stronger effect than institutional CSR (secondary stakeholders).
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Key points
- CSR performance is negatively associated with bond credit spreads in Chinese family firms.
- Technical CSR (primary stakeholders) has a stronger effect on reducing credit spreads than institutional CSR (secondary stakeholders).
- Institutional ownership and analyst coverage weaken the negative relationship between CSR and credit spreads.
- The study focuses on the unique context of Chinese family firms and decomposes CSR into distinct dimensions.
AI-generated from the title and abstract; the full text is not read.
Abstract
This paper examines the relationship between corporate social responsibility (CSR) and the credit spreads of corporate bonds issued by Chinese family firms. Drawing on signaling theory, we argue that CSR serves as a credible signal to reduce information asymmetry, thereby lowering credit spreads. Using a sample of Chinese family firms from 2011 to 2019, we find that CSR performance is negatively associated with bond credit spreads, supporting our signaling hypothesis. More intriguingly, technical CSR, directed toward primary stakeholders, exhibits a stronger effect than institutional CSR, directed toward secondary stakeholders . Moreover, institutional ownership and analyst coverage weaken the negative relationship between CSR performance and credit spreads. This paper contributes to the growing literature on CSR and cost of bond financing by focusing on the unique context of family firms in China. It also advances the understanding of CSR by decomposing it into distinct dimensions. Our findings offer practical insights for family firms seeking to balance technical and institutional CSR.
The authors' abstract, as published at the source. Asian Journal of Business Ethics, 2026 · DOI ↗
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Field: Organizational Behavior and Human Resource Management
Organizational Behavior and Human Resource ManagementBusiness, Management and Accounting