analyse the impact of corporate social responsibility disclosure on financial performance by comparing the management of corporate social responsibility in China and Hong Kong of the property industry and to explore whether there is a difference in management perspectives on CSR performance.
- Background to the study
It is an old and hotly debated issue whether adopting corporate social responsibility (CSR) can improve a corporation’s financial performance (FP). Thus, a strong understanding of the relationship between CSR and FP would be beneficial in terms of corporate managers, stockholders, and stakeholders. In addition, a company adopts CSR generally due to its benefits to the external aspect of reduction in social inequality and environmental improvement, and internal for enhancement of reputation, potentially charge a premium price for products or services, also has the capability to upgrade recruitment and retaining top-quality staffs. The foremost attraction is that companies adopting CSR can result in financial benefits that are greater than the respective costs, thereby increasing FP in the future. Accordingly, adopting CSR can be beneficial to both company’s shareholders and stakeholders, which creates a possible win–win situation (Wu & Shen 2013).
The majority of the scholar mentioned that CSR has gradually become the consensus of all the enterprises in the world, and deem CSR is an activity indispensable (Wu & Shen 2013; Park & Ghauri 2015; Liu, Saleem, Shabbir, Shabbir, Irshad & Khan 2021).
According to the Global Status Report for Buildings and Construction (Globalabc 2021), there is 36 % of global final energy consumption for the building and construction sector, 37% of energy-related CO2 emissions, and there is a fear that construction demand will push up emissions in Asia and estimated that could be doubled the building stock by 2050 anticipation.
Global material use is expected to more than double by 2060, with a third of the growth coming from materials used in the building and construction sector. For the property industry, environmental pollution is a problem that deserves the foremost attention.
The new CSR equation is transparency plus good governance for brand trustworthiness, transparency is an important part of building trust between organizations and their stakeholders, yet many are still struggling to uphold this principle, while good governance is more than just doing good and improving your reputation. It’s a way to catch problems early without any nasty surprises (Miranda 2016).
- Justification of the study
1.2.1 Literature gaps
Previous research has focused on the environment and the CSR of property companies in other countries (Newell and Manaf 2008), therefore, in order to fill a gap in the literature, this paper aims to assess the implementation of CSR which is practiced in Hong Kong and China property, especially from environmental and governance perspective.
1.2.2 Importance of the issues in HK / CHINA
Over the past few years, the property industry is growing rapidly in HK and China, given the shortage of housing in Hong Kong, while investors in China are using real estate as a hedge against the surge in inflation (Spiro 2021). The booming would be a concern about the pollution in the environment. Yet, other parties with different cultural influences result in differences in CSR in HK and China. Separately whether CSR is a strategy for Hong Kong and China’s property industry and impacts the financial performance.
- Research aims and objectives
The research aim is to analyse the impact of corporate social responsibility disclosure on financial performance by comparing the management of corporate social responsibility in China and Hong Kong of the property industry and to explore whether there is a difference in management perspectives on CSR performance.
