CSR decoupling and stock price crash risk: Evidence from China

Abstract This paper examines the efficacy of corporate social responsibility (CSR) decoupling on stock price crash risk (SPCR). Selecting Chinese listed companies over the 2010–2019 period as a sample, we find that CSR decoupling exacerbates SPCR, and this relationship still holds after a battery of endogeneity and robustness tests. Further analysis reveals that within companies characterized by higher agency risks, CSR decoupling exacerbates SPCR more significantly, suggesting the role of information asymmetry as a crucial mechanism through which CSR decoupling influences SPCR. Our results show CSR decoupling’s harm on the capital market and help clarify mixed evidence in existing studies.