CSR Disclosure, Organizational Legitimacy, and Cross-Border M&A Outcomes Evidence from China

Abstract

Abstract

Purpose: This study examines whether corporate social responsibility (CSR) disclosure functions as a legitimacy-building and governance-signaling mechanism in Chinese firms’ cross-border mergers and acquisitions (M&As).

Methodology: Drawing on stakeholder theory, agency theory, and organizational legitimacy, we analyze 803 announced overseas M&A deals by Shanghai Stock Exchange A-share listed firms during 2016–2020. We test whether the completeness of CSR disclosure is associated with deal completion and changes in post-acquisition return on assets.

Findings: The evidence indicates that acquirers with more complete CSR disclosure are more likely to complete announced overseas acquisitions and experience stronger post-acquisition operating performance. These associations suggest that CSR disclosure may reduce information asymmetry, strengthen stakeholder trust, and mitigate resistance and integration frictions in cross-border transactions.

Originality: The study extends research on emerging-market multinational enterprises by reframing CSR as a non-market capability that supports international expansion. It also contributes to Asia-Pacific social research by linking corporate responsibility, organizational legitimacy, and cross-border economic activity in the context of Chinese firms’ global investment.