Can mandatory CSR disclosure affect firms’ international business strategies? Empirical evidence from China’s A-share market

This study examines how China's mandatory corporate social responsibility (CSR) disclosure regulation influences firms' international business strategies. Using a difference-in-differences design, the analysis reveals heterogeneous effects across international activities. On the trade side, mandatory CSR disclosure enhances firms' export competitiveness by promoting product quality upgrading through improved information transparency. This positive effect is particularly pronounced in markets with stronger CSR concerns, under more intense export competition, and when information asymmetry with foreign buyers is higher. By contrast, no significant change is observed in foreign trademark applications, suggesting that disclosure fosters substantive quality improvements rather than symbolic brand building. On the investment side, mandatory disclosure reduces firms' overseas expansion The adverse effect is stronger when firms face greater compliance pressure, external monitoring and financing constraints. Overall, the findings highlight the dual role of mandatory CSR disclosure: while it stimulates export-oriented upgrading, it simultaneously discourages international investment, thereby reshaping the allocation of firms' global business strategies.