Do SOEs outperform private enterprises in CSR? Evidence from China

Purpose The purpose of this paper is to explore the relationship between firm size, the nature of ownership and corporate social responsibility (CSR) performance in China and to figure out the reason that state-owned enterprises (SOEs) usually perform better in CSR activities than private enterprises. Design/methodology/approach The authors conducted two studies of CSR in China. In the first study, the authors developed and assessed a CSR measure; second study was to investigate the difference of CSR behavioral performance between SOEs and private enterprises. Findings The authors found that the differences in CSR performances between SOEs and private enterprises were not caused by the nature of ownership as most Chinese scholars used to believe. Actually, the differences came from the differences of firm size, which had been ignored in prior studies on factors influencing CSR performance. The size of SOEs is usually much larger than private enterprises, and larger enterprises often perform better in the field of CSR. In a word, the size rather than the nature of ownership is the main reason that CSR performances of SOEs are better than private enterprises. Originality/value Though many papers in China suggested that SOEs performed much better than private enterprises in CSR activities, the authors proved that this belief was a misunderstanding. It was found that SOEs were usually larger than private enterprises, which might have confused their efforts to find the real reason that SOEs and private enterprises perform differently in CSR. The authors also developed a measuring tool of CSR based on the Stakeholder Theory, which would be a new measurement tool for future studies, especially for emerging market economies and unlisted companies.