Corporate social responsibility and access to bank loan: how much and how to give both matter

This paper aims to investigate the inverse U-shape relationship between DM and accessing loans from the banks and explore the moderating effect of donation mode diversity.

Based on a survey dataset of 1,036 private firms in China, we use a Heckman two-stage estimation model to test hypothesizes.

The results show an invert U-shape relationship between donation magnitude and access to bank loan. The authors also find that donation mode diversity will positively moderate donation magnitude–bank loan relationship: the positive effect of donation magnitude will be stronger for the private firms using multiple channels of philanthropic donation.

This paper extends the literatures by examining how philanthropic donation behaviors in form of donation magnitude (how much to give) and donation mode diversity (how to give) influence private firms’ loan borrowed from the bank, an important but largely ignored stakeholder. Therefore, it suggests that both the amount and the channels of philanthropic donation could have significant roles in the efficiency of achieving strategic outcomes of corporate philanthropy.