Management International Review

, Volume 58, Issue 2, pp 313–335 | Cite as

The Impact of Internationalization on Home Country Charitable Donation: Evidence from Chinese Firms

  • Heng Liu
  • Jin-hui LuoEmail author
  • Victor Cui
Research Article


Does internationalization promote or inhibit home country charitable donation for firms from developing countries? This is an important question that remains poorly studied. This paper aims to address this question by focusing on Chinese internationalizing firms. We maintain that while broadening overseas markets brings financial returns to Chinese firms, their domestic charitable donation may decrease with the level of internationalization. Drawing on the resource dependence theory, we argue that the more Chinese firms depend on overseas sales, the less important domestic stakeholders are for their survival, and therefore they are less likely to make charitable donations within China. Further, we maintain that this negative relationship between internationalization and home country charitable donation is attenuated by Chinese firms’ state-ownership. This is because state-ownership provides the firms with alternative sources of critical resources that alleviate their dependence on the international markets. We tested and supported our theory using data collected from all public firms in China between 2008 and 2012. Theoretical and policy implications are provided.


Internationalization Charitable donation Developing countries China Resource dependence theory 



We would like to thank valuable comments and suggestions from two anonymous reviewers, as well as participants at the 2015 AOM annual meeting and the AIB 2017 Dubai conference. We acknowledge financial support from the Chinese National Science Funds (Grant No. 71572160 and 71672197) and the Key Research Project of Guangdong Province (Grant No. 2016WZDXM001). All remaining errors are our own.


  1. Adams, M., & Hardwick, P. (1998). An analysis of corporate donations: United Kingdom evidence. Journal of Management Studies, 35(5), 641–654.CrossRefGoogle Scholar
  2. Agle, B. R., Mitchell, R. K., & Sonnenfeld, J. A. (1999). Who matters to CEOs? An investigation of stakeholder attributes and salience, corporate performance, and CEO values. Academy of Management Journal, 42(5), 507–525.CrossRefGoogle Scholar
  3. Aguilera-Caracuel, J., Guerrero-Villegas, J., Vidal-Salazar, M. D., & Delgado-Marquez, B. L. (2015). International cultural diversification and corporate social performance in multinational enterprises: The role of slack financial resources. Management International Review, 55(3), 323–353.CrossRefGoogle Scholar
  4. Aiken, L. S., & West, S. G. (1991). Multiple regression: Testing and interpreting interactions. Newbury Park, CA: Sage.Google Scholar
  5. Arquette, G. C., Brown, W. O., & Burdekin, R. C. K. (2008). US ADR and Hong Kong H-share discounts of Shanghai-listed firms. Journal of Banking and Finance, 32(9), 1916–1927.CrossRefGoogle Scholar
  6. Attig, N., Boubakri, N., El Ghoul, S., & Guedhami, O. (2016). Firm internationalization and corporate social responsibility. Journal of Business Ethics, 134(2), 171–197.CrossRefGoogle Scholar
  7. Benito, G., Peterson, B., & Welch, L. S. (2011). Mode combinations and international operations. Management International Review, 51(6), 803–820.CrossRefGoogle Scholar
  8. Benito, G., Rygh, A., & Lunnan, R. (2016). The benefits of internationalization for state-owned enterprises. Global Strategy Journal, 6(4), 269–288.CrossRefGoogle Scholar
  9. Bhambri, A., & Sonnenfeld, J. (1988). Organization structure and corporate social performance: A field study in two contrasting industries. Academy of Management Journal, 31(3), 642–662.CrossRefGoogle Scholar
  10. Brammer, S., & Millington, A. (2008). Does it pay to be different? An analysis of the relationship between corporate social and financial performance. Strategic Management Journal, 29(12), 1325–1343.CrossRefGoogle Scholar
  11. Brammer, S., Pavelin, S., & Porter, L. A. (2009). Corporate charitable giving, multinational companies and countries of concern. Journal of Management Studies, 46(4), 575–596.CrossRefGoogle Scholar
  12. Brown, W., Helland, E., & Smith, J. K. (2006). Corporate philanthropic practices. Journal of Corporate Finance, 12(5), 855–877.CrossRefGoogle Scholar
  13. Campbell, L., Gulas, C. S., & Gruca, T. S. (1999). Corporate giving behavior and decision-maker social consciousness. Journal of Business Ethics, 19(4), 375–383.CrossRefGoogle Scholar
  14. Carroll, A. B. (1979). A three-dimensional conceptual model of corporate performance. Academy of Management Review, 4(4), 497–505.Google Scholar
  15. Carroll, A. B. (1991). The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders. Business Horizons, 34(4), 39–48.CrossRefGoogle Scholar
  16. Chen, B., & Feng, Y. (2000). Determinants of economic growth in China: Private enterprise, education, and openness. China Economic Review, 11(1), 1–15.CrossRefGoogle Scholar
  17. Chen, V. Z., Li, J., Shapiro, D. M., & Zhang, X. (2014). Ownership structure and innovation: An emerging market perspective. Asia Pacific Journal of Management, 31(1), 1–24.CrossRefGoogle Scholar
  18. Chen, J. C., Patten, D. M., & Roberts, R. W. (2008). Corporate charitable contributions: A corporate social performance or legitimacy strategy? Journal of Business Ethics, 82(1), 131–144.CrossRefGoogle Scholar
  19. Cheung, Y.-L., Kong, D., Tan, W., & Wang, W. (2015). Being good when being international in an emerging economy: The case of China. Journal of Business Ethics, 130(4), 805–817.CrossRefGoogle Scholar
  20. Child, J., & Rodrigues, S. B. (2005). The internationalization of Chinese firms: A case for theoretical extension. Management and Organization Review, 1(3), 381–410.CrossRefGoogle Scholar
  21. Ciravegna, L., Lopez, L., & Kundu, S. (2014). Country of origin and network effects on internationalization: A comparative study of SMEs from an emerging and developed economy. Journal of Business Research, 67(5), 916–923.CrossRefGoogle Scholar
  22. Coffey, B. S., & Wang, J. (1998). Board diversity and managerial control as predictors of corporate social performance. Journal of Business Ethics, 17(14), 1595–1603.CrossRefGoogle Scholar
  23. Cox, P., Brammer, S., & Millington, A. (2004). An empirical examination of institutional investor preferences for corporate social performance. Journal of Business Ethics, 52(1), 27–43.CrossRefGoogle Scholar
  24. Cuervo-Cazurra, A., Inkpen, A., Musacchio, A., & Ramaswamy, K. (2014). Governments as owners: State-owned multinational companies. Journal of International Business Studies, 45(8), 919–942.CrossRefGoogle Scholar
  25. Curran, E. (2015). State companies: Back on China’s to-do list. Bloomberg Businessweek. Accessed 29 April 2016.
  26. Du, X. (2015). Is corporate philanthropy used as environmental misconduct dressing? Evidence from Chinese family-owned firms. Journal of Business Ethics, 129(2), 341–361.CrossRefGoogle Scholar
  27. Du, X., & Luo, J.-H. (2016). Political connections, home formal institutions, and internationalization: Evidence from China. Management and Organization Review, 12(1), 103–133.CrossRefGoogle Scholar
  28. Dyer, W. G., & Whetten, D. A. (2006). Family firms and social responsibility: Preliminary evidence from the S&P 500. Entrepreneurship Theory and Practice, 30(6), 803–808.CrossRefGoogle Scholar
  29. Evans, W., & Davis, W. (2011). An examination of perceived corporate citizenship, job applicant attraction, and CSR work role definition. Business and Society, 50(3), 456–480.CrossRefGoogle Scholar
  30. Fan, G., Wang, X., & Zhu, H. (2011). NERI index of marketization of China’s provinces. Beijing: Economic Science Press. (in Chinese).Google Scholar
  31. Fernández, Z., & Nieto, M. J. (2006). Impact of ownership on the international involvement of SMEs. Journal of International Business Studies, 37(3), 340–351.CrossRefGoogle Scholar
  32. Finkelstein, S. (1997). Interindustry merger patterns and resource dependence: A replication and extension of Pfeffer (1972). Strategic Management Journal, 18(10), 787–810.CrossRefGoogle Scholar
  33. Frynas, J., & Yamahaki, C. (2016). Corporate social responsibility: Review and roadmap of theoretical perspectives. Business Ethics: A European Review, 25(3), 258–285.CrossRefGoogle Scholar
  34. Gao, Y. (2011). Philanthropic disaster relief giving as a response to institutional pressure: Evidence from China. Journal of Business Research, 64(12), 1377–1382.CrossRefGoogle Scholar
  35. Gao, F., Faff, R., & Navissi, F. (2012). Corporate philanthropy: Insights from the 2008 Wenchuan earthquake in China. Pacific-Basin Finance Journal, 20(3), 363–377.CrossRefGoogle Scholar
  36. Gaur, A., & Delios, A. (2015). Internationalization diversification of emerging market firms: The role of ownership structure and group affiliation. Management International Review, 55(2), 235–253.CrossRefGoogle Scholar
  37. Gaur, A. S., Kumar, V., & Singh, D. (2014). Institutions, resources, and internationalization of emerging economy firms. Journal of World Business, 49(1), 12–20.CrossRefGoogle Scholar
  38. Graves, C., & Shan, Y. G. (2014). An empirical analysis of the effect of internationalization on the performance of unlisted family and nonfamily firms in Australia. Family Business Review, 27(2), 142–160.CrossRefGoogle Scholar
  39. Griffin, J. J., & Mahon, J. F. (1997). The corporate social performance and corporate financial performance debate: Twenty-five years of incomparable research. Business and Society, 36(1), 5–31.CrossRefGoogle Scholar
  40. He, W., & Lyles, M. (2008). China’s outward foreign direct investment. Business Horizons, 51(6), 485–491.CrossRefGoogle Scholar
  41. Hillman, A. J., Withers, M. C., & Collin, B. J. (2009). Resource dependence theory: A review. Journal of Management, 35(6), 1404–1427.CrossRefGoogle Scholar
  42. Hitt, M. A., Bierman, L., Uhlenbruck, K., & Shimizu, K. (2006). The importance of resources in the internationalization of professional service firms. Academy of Management Journal, 49(6), 1137–1157.CrossRefGoogle Scholar
  43. Hurtado, S., & Agudelo, J. (2013). The continuity and stability of corporate philanthropy donation: Evidence from Chinese Firms’ Response to Disaster Relief. International Journal of Business and Management, 8(2), 10–18.Google Scholar
  44. Jia, M., & Zhang, Z. (2013). Critical mass of women on BODs, multiple identities, and corporate philanthropic disaster response: Evidence from privately owned Chinese firms. Journal of Business Ethics, 118(2), 303–317.CrossRefGoogle Scholar
  45. Jia, M., & Zhang, Z. (2015). News visibility and corporate philanthropic response: Evidence from privately owned Chinese firms following the Wenchuan earthquake. Journal of Business Ethics, 129(1), 93–114.CrossRefGoogle Scholar
  46. Kacperczyk, A. (2009). With greater power comes greater responsibility? Takeover protection and corporate attention to stakeholders. Strategic Management Journal, 30(3), 261–285.CrossRefGoogle Scholar
  47. Kang, J. (2013). The relationship between corporate diversification and corporate social performance. Strategic Management Journal, 34(1), 94–109.CrossRefGoogle Scholar
  48. Khwaja, A., & Mian, A. (2005). Do lenders favor politically connected firms? Rent provision in an emerging financial market. Quarterly Journal of Economics, 120(4), 1371–1411.CrossRefGoogle Scholar
  49. Kolk, A., Hong, P., & Van Dolen, W. (2010). Corporate social responsibility in China: An analysis of domestic and foreign retailers’ sustainability dimensions. Business Strategy and the Environment, 19(5), 289–303.Google Scholar
  50. Li, S., Song, X., & Wu, H. (2015). Political connections, ownership structure, and corporate philanthropy in China: A strategic-political perspective. Journal of Business Ethics, 129(2), 399–411.CrossRefGoogle Scholar
  51. Li, W., & Zhang, R. (2010). Corporate social responsibility, ownership structure, and political interference. Journal of Business Ethics, 96(4), 631–645.CrossRefGoogle Scholar
  52. Luo, Y., & Tung, R. L. (2007). International expansion of emerging market enterprises: A springboard perspective. Journal of International Business Studies, 38(4), 481–498.CrossRefGoogle Scholar
  53. Luo, J.-H., Xiang, Y., & Zhu, R. (2017). Military top executives and corporate philanthropy: Evidence from China. Asia Pacific Journal of Management, 34(3), 725–755.CrossRefGoogle Scholar
  54. Marano, V., Arregle, J. L., Hitt, M. A., Spadafora, E., & Essen, M. V. (2016). Home country institutions and the internationalization–performance relationship: A meta-analytic review. Journal of Management, 42(5), 1075–1110.CrossRefGoogle Scholar
  55. Mizruchi, M., & Yoo, M. (2017). Interorganizational power and dependence. In J. A. C. Baum (Ed.), The Blackwell companion to organizations (pp. 599–620). Oxford: Blackwell Publishing Ltd.Google Scholar
  56. Musacchio, A., & Lazzarini, S. G. (2014). Reinventing state capitalism. London: Harvard University Press.CrossRefGoogle Scholar
  57. Nee, V. (1992). Organizational dynamics of market transition: Hybrid forms, property rights, and mixed economy in China. Administrative Science Quarterly, 37(1), 1–27.CrossRefGoogle Scholar
  58. Orlitzky, M., Siegel, D. S., & Waldman, D. A. (2011). Strategic corporate social responsibility and environmental sustainability. Business and Society, 50(1), 6–27.CrossRefGoogle Scholar
  59. Park, S. H., Chen, R., & Gallagher, S. (2002). Firm resources as moderators of the relationship between market growth and strategic alliances in semiconductor start-ups. Academy of Management Journal, 45(3), 527–545.CrossRefGoogle Scholar
  60. Park, S. H., & Luo, Y. (2001). Guanxi and organizational dynamics: Organizational networking in Chinese firms. Strategic Management Journal, 22(5), 455–477.CrossRefGoogle Scholar
  61. Peng, M., Tan, J., & Tong, T. (2004). Ownership types and strategic groups in an emerging economy. Journal of Management Studies, 41(7), 1105–1109.CrossRefGoogle Scholar
  62. Pfeffer, J. (1987). A resource dependence perspective on inter-corporate relations. Cambridge: Cambridge University Press.Google Scholar
  63. Pfeffer, J., & Salancik, G. R. (1978). The external control of organizations: A resource dependence perspective. New York: Harper and Row.Google Scholar
  64. Porter, M. E., & Kramer, M. R. (2002). The competitive advantage of corporate philanthropy. Harvard Business Review, 80(1), 5–16.Google Scholar
  65. Reuer, J. J., & Ragozzino, R. (2006). Agency hazards and alliance portfolios. Strategic Management Journal, 27(1), 27–43.CrossRefGoogle Scholar
  66. Ryan, T. P. (1997). Modern regression methods. New York: Wiley.Google Scholar
  67. Saiia, D. H., Carroll, A. B., & Buchholtz, A. K. (2003). Philanthropy as strategy: When corporate charity “begins at home”. Business and Society, 42(2), 169–201.CrossRefGoogle Scholar
  68. Sanchez, C. M. (2000). Motives for corporate philanthropy in EI Salvador: Altruism and political legitimacy. Journal of Business Ethics, 27(4), 363–375.CrossRefGoogle Scholar
  69. Sheng, S., Zhou, K. Z., & Li, J. J. (2011). The effects of business and political ties on firm performance: Evidence from China. Journal of Marketing, 75(1), 1–15.CrossRefGoogle Scholar
  70. Simerly, R. L., & Li, M. (2000). Corporate social performance and multinationality, a longitudinal study. Working paper:
  71. Singla, C., & George, R. (2013). Internationalization and performance: A contextual analysis of Indian firms. Journal of Business Research, 66(12), 2500–2506.CrossRefGoogle Scholar
  72. Su, J., & He, J. (2010). Does giving lead to getting? Evidence from Chinese private enterprises. Journal of Business Ethics, 93(1), 73–90.CrossRefGoogle Scholar
  73. Sun, S. L., Peng, M. W., Ren, B., & Yan, D. (2010). A comparative ownership advantage framework for cross-border M&As: The rise of Chinese and Indian MNEs. Journal of World Business, 47(1), 4–16.CrossRefGoogle Scholar
  74. Tan, W., Peng, M. W., & Sun, S. L. (2008). Competing on scale or scope? Evidence from Chinese firms’ internationalization. Management World, 2, 126–135. (in Chinese).Google Scholar
  75. Wang, H., & Qian, C. (2011). Corporate philanthropy and corporate financial performance: The role of stakeholder response and political access. Academy of Management Journal, 54(6), 1159–1181.CrossRefGoogle Scholar
  76. White, H. (1980). A heteroskedasticity-consistent covariance matrix estimator and a direct test for heteroskedasticity. Econometrica, 48(4), 817–830.CrossRefGoogle Scholar
  77. Wood, D. J. (1991). Corporate social performance revisited. Academy of Management Review, 16(4), 691–718.Google Scholar
  78. Wooldridge, J. M. (2009). Introductory econometrics: A modern approach (4th ed.). Cincinnati: South-Western College Pub.Google Scholar
  79. Wright, M., Filatotchev, I., Hoskisson, R. E., & Peng, M. W. (2005). Strategy research in emerging economies: Challenging the conventional wisdom. Journal of Management Studies, 42(1), 1–33.CrossRefGoogle Scholar
  80. Xu, E., & Zhang, H. (2008). The impact of state shares on corporate innovation strategy and performance in China. Asia Pacific Journal of Management, 25(3), 472–487.CrossRefGoogle Scholar
  81. Yang, X., Jiang, Y., Kang, R., & Ke, Y. (2009). A comparative analysis of the internationalization of Chinese and Japanese firms. Asia Pacific Journal of Management, 26(1), 141–162.CrossRefGoogle Scholar
  82. Zahra, S. A., Ireland, R. D., & Hitt, M. A. (2000). International expansion by new venture firms: International diversity, model of market entry, technological learning, and performance. Academy of Management Journal, 43(5), 925–950.CrossRefGoogle Scholar
  83. Zhang, Y., Li, H., Hitt, M. A., & Cui, G. (2007). R&D intensity and international joint venture performance in an emerging market: Moderating effects of market focus and ownership structure. Journal of International Business Studies, 38(6), 944–960.CrossRefGoogle Scholar
  84. Zhang, R., Rezaee, Z., & Zhu, J. (2010a). Corporate philanthropic disaster response and ownership type: Evidence from Chinese firms’ response to the Sichuan earthquake. Journal of Business Ethics, 91(1), 51–63.CrossRefGoogle Scholar
  85. Zhang, R., Zhu, J., Yue, H., & Zhu, Y. (2010b). Corporate philanthropic giving, advertising intensity, and industry competition level. Journal of Business Ethics, 94(1), 39–52.CrossRefGoogle Scholar
  86. Zhou, K. Z., Gao, G. Y., & Zhao, H. (2017). State ownership and firm innovation in China: An integrated view of institutional and efficiency logics. Administrative Science Quarterly, 62(2), 375–404.CrossRefGoogle Scholar

Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Lingnan (University) CollegeSun Yat-sen UniversityGuangzhouPeople’s Republic of China
  2. 2.School of ManagementXiamen UniversityXiamenPeople’s Republic of China
  3. 3.Asper School of BusinessUniversity of ManitobaManitobaCanada

Personalised recommendations