UM  > Faculty of Business Administration
Stock Liquidity and Corporate Social Responsibility
Xin (Simba) Chang1; Weiqiang Tan2; Endong Yang3; Wenrui Zhang4
Conference Name31st Australasian Finance and Banking Conference 2018
Source Publicationproceedings of 31st Australasian Finance and Banking Conference 2018
Conference DateDecember 13-15, 2018
Conference PlaceSydney NSW 2052 , Australia

We show that stock liquidity negatively affects firms’ corporate social responsibility (CSR) ratings. To identify the causal effect, we use the decimalization of stock trading as an exogenous shock to liquidity. The negative CSR effect of liquidity is more pronounced for firms where short-term institutional ownership is higher, CEOs’ wealth is more sensitive to firm value, CEOs approach the retirement age, analyst coverage is higher, or there are more covenants on firms’ bank debt. These findings suggest that high stock liquidity increases short-termism pressure and discourages firms from engaging in CSR activities, which are long-term in nature. Overall, our analysis reveals the potential disincentives created by stock liquidity in aligning the interest of shareholders and other stakeholders.

KeywordStock Liquidity Short-termism Corporate Social Responsibility (Csr) Investor Horizon
Fulltext Access
Document TypeConference paper
CollectionFaculty of Business Administration
Affiliation1.Nanyang Business School, Nanyang Technological University
2.Hong Kong Baptist University
3.University of Macau
4.The Chinese University of Hong Kong (CUHK) - Department of Finance
Recommended Citation
GB/T 7714
Xin ,Weiqiang Tan,Endong Yang,et al. Stock Liquidity and Corporate Social Responsibility[C],2019.
Files in This Item:
There are no files associated with this item.
Related Services
Recommend this item
Usage statistics
Export to Endnote
Google Scholar
Similar articles in Google Scholar
[Xin (Simba) Chang]'s Articles
[Weiqiang Tan]'s Articles
[Endong Yang]'s Articles
Baidu academic
Similar articles in Baidu academic
[Xin (Simba) Chang]'s Articles
[Weiqiang Tan]'s Articles
[Endong Yang]'s Articles
Bing Scholar
Similar articles in Bing Scholar
[Xin (Simba) Chang]'s Articles
[Weiqiang Tan]'s Articles
[Endong Yang]'s Articles
Terms of Use
No data!
Social Bookmark/Share
All comments (0)
No comment.

Items in the repository are protected by copyright, with all rights reserved, unless otherwise indicated.