A Study of the Effect of Social Responsibility on Cost of Capital and Reputation of a Retailing Company
A Study of the Effect of Social Responsibility on Cost of Capital and Reputation of a Retailing Company

Summary/Abstract: The emerging ideology of social responsibility in past years results in many enterprises actively investing in corporate social responsibility related policies, expecting to promote people’s positive image through the improvement of living environment and the care of the public. Although the practice of corporate social responsibility would not necessarily bring in significant benefits in short period, it, in long period, could achieve the vision of sustainable development and promote corporate reputation through external benefits to acquire more supporters and further enhance the profits, promote the international competitive advantage, and reduce the market opinions of corporate business risk of the company to acquire lower cost of capital. In this study, the owners and senior executives of the Shenzhen Stock Exchange's listed in retail industry were investigated. A total of 300 copies of questionnaire are distributed for this study, and 227 valid copies are retrieved, with the retrieval rate 76%. According to the results, suggestions are proposed, expecting to induce retailing managers’ new motives and incentives to execute corporate social responsibility related policies and effectively inhibit the increase in cost of capital and the decrease in corporate reputation.

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