Assessment of parent-subsidiary companies’ geographical distance effect on corporate social responsibility: a case of A-share listed companies

Abstract

Corporate Social Responsibility (CSR) is considered as an important business agenda in the current age. Based on the data of A-share listed companies from 2010 to 2020, this study used a fixed-effect model, heterogeneity analysis and intermediary effect test to investigate the relationship between parent-subsidiary geographical distance and CSR. Our study findings revealed that the parent-subsidiary companies’ geographic distance has a negative effect on CSR. Results of our study further indicated that the effect was more stronger for non-state-owned enterprises and the firms in the eastern region. Findings of our study also reported that the enterprise internal control had an obvious mediating effect in the association among parent-subsidiary companies’ geographic distance and CSR. The government needs to reinforce legal construction, actively guide enterprises to perform CSR through incentive measures, and implement special supervision on enterprises with a large number of subsidiaries. This study not only enriches the literature on the factors influencing corporate social responsibility but also provides a theoretical perspective and important ideas for the effective implementation of regional diversification and the improvement of CSR levels in practice.

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