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Adversity Tries Friends: A Multilevel Analysis of Corporate Philanthropic Response to the Local Spread of COVID-19 in China.
Chen, Hanwen; Liu, Siyi; Liu, Xin; Yang, Daoguang.
  • Chen H; School of Government Auditing, Nanjing Audit University, 86 West Yushan Road, Nanjing, 211815 P.R. China.
  • Liu S; UIBE Business School, University of International Business and Economics, No.10 Huixin Dongjie, Beijing, 100029 P.R. China.
  • Liu X; UIBE Business School, University of International Business and Economics, No.10 Huixin Dongjie, Beijing, 100029 P.R. China.
  • Yang D; UIBE Business School, University of International Business and Economics, No.10 Huixin Dongjie, Beijing, 100029 P.R. China.
J Bus Ethics ; 177(3): 585-612, 2022.
Article in English | MEDLINE | ID: covidwho-1092699
ABSTRACT
We examine corporate philanthropic decisions in response to the local spread of COVID-19. From a strategic perspective, firms may proactively undertake philanthropic efforts to limit the spread of the pandemic and avoid a degraded business environment. From the perspective of non-trivial costs, increased economic uncertainty can raise concerns about business survival and lead to conservative philanthropic strategies. Following the proverb "prosperity makes friends, adversity tries them," at the provincial level, our results support the second perspective. Specifically, when the spread of the pandemic worsens in a province, local firms are less likely to make COVID-19-related donations in terms of likelihood and amount. Investors also react negatively, not only to the local spread of COVID-19 but also to COVID-19-related philanthropic donations. At the organizational level, our evidence indicates that there is at least some level of cost-benefit analysis underlying corporate philanthropic decisions. Specifically, corporate philanthropic donations, especially those made to the local business environment, are significantly affected by organizational-level factors, such as pre-existing resource availability and motives to acquire political and reputational resources. Overall, our multilevel study presents a comprehensive picture of corporate philanthropic decisions amid the COVID-19 crisis.
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Full text: Available Collection: International databases Database: MEDLINE Type of study: Prognostic study Language: English Journal: J Bus Ethics Journal subject: Ethics Year: 2022 Document Type: Article

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Full text: Available Collection: International databases Database: MEDLINE Type of study: Prognostic study Language: English Journal: J Bus Ethics Journal subject: Ethics Year: 2022 Document Type: Article