What's the Value in It? Corporate Philanthropic Giving under Uncertainty.

This paper investigates whether and how corporate philanthropy (CP) is affected by a firm's perceived degree of environmental uncertainty in the context of a transition economy. Evidence from a nation-wide survey of private firms across China suggests that both regulatory uncertainty and market uncertainty in a transition economy motivate firms to conduct CP. Further, a firm's political ties and financial performance alleviate its response to environment pressures. Specifically, both political ties and financial performance reduce the impact of regulatory uncertainty on both giving probability and amount, but neither affects market uncertainty's impact. This study illustrates the role of environmental uncertainty in driving corporate social behavior among Chinese private firms, and provides valuable insights for CP activities in other transition economies. [ABSTRACT FROM AUTHOR]