Organization and Strategy Seminar（2019-12）

Topic: POLITICAL UNCERTAINTYDYNAMICSANDCORPORATE DONATIONS: A STUDY OF PUBLICLY TRADED FIRMS IN CHINA

Speaker: Qi Li,CornellUniversity

Time: Friday, 25 October, 14:00-15:30 pm

Location: Room 217, Guanghua Building 2

Abstract:

This studyargues that firms strategically employcorporate social responsibility (CSR)to managepolitical uncertaintyfrom a resource dependence perspective.Iprovided a nuanced distinction ofpolitical uncertainty from the perspective turnovers of city government leaders,including the promotion (which indicates political favorability), retirement (which refers to smooth political transition)and demotion officials (which suggests political adversity). Then, Istudied how these factors affect corporate philanthropic donations in different ways, which are used as a political strategy to alleviate resource dependence.Political favorability and smooth political transition are associated with less resource dependence and thus lower amount of donations, whereas the opposite applies to political adversity.In addition, the negative effects of promotion and retirement on the amount of donation are weaker and the positive effect of demotion on donation is reduced as the level of institutional development increases.Ifound supporting evidence upon testing the hypotheseswithauniquenationwide longitudinal dataset of all publicly traded non-state owned Chinese companiesand hand-collected information of city government leadersfrom 2001 to 2016.This study contributes to an improved understanding ofhow political processes affect the CSR of firms, particularly the specific resource dependence mechanisms that underlie the business–government relationship.

Introduction:

Qi Li is a PhD student in the management & organizations department atCornell University, S.C. Johnson College of Business. Her research focuses on corporate social responsibility, nonmarket strategy, and globalization strategies for private enterprises, with a geographical focus on Asia. Prior to enrolling at Johnson, Qi was a research assistant to the director of the Ash Center for Democratic Governance and Innovation at Harvard Kennedy School. Qi holds an MPA from Harvard University's Kennedy School of Government, and an MBA from the Olin Business School at Babson College, where she received a full merit scholarship. Before coming to Harvard, Qi was an entrepreneur in China who launched a successful education venture (later acquired). She has also interned at the U.S. Congress (House of Representatives), the Development Research Center of the State Council of China, and the China Development Bank. Qi has also served as the president of the Harvard Kennedy School Chinese Students and Scholars Association. Through her student leadership role at HKS, Qi has developed a deep understanding of Chinese political dynamics via her numerous collaborations and interactions with minister and deputy-minister level members of the Chinese Leadership.

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