China Europe International Business School (CEIBS), China
Prior studies less explored when diverse stakeholders react similarly and differently to the same CSR reporting. This paper examines how and when rich information disclosed in CSR reports will elicit similar and different reactions from investors, as reflected in stock market reaction, and the general public, as reflected in the favorability of media coverage. We find that, in general, disclosing rich information in CSR reports is positively associated with stock market reaction and media coverage tone. Furthermore, we find that performance decline weakens the positive relationship between rich CSR reports and stock market reaction but strengthens the positive relationship between rich CSR reports and media coverage tone. In contrast, congruence of CSR and core business operations strengthens the positive relationship between rich CSR reports and stock market reaction but weakens the positive relationship between rich CSR reports and media coverage tone. We used computerized content analysis to quantify the extent of information richness in CSR reports and empirically test our hypotheses through data from Chinese listed firms between 2008 to 2017.
