Do Companies Involved in Targeted Poverty Alleviation Have the Higher Investment Value?——Impact of TPA on Firm's Risks
Many companies get actively involved in targeted poverty alleviation,which plays an important role in ridding of absolute poverty and winning the battle against poverty alleviation in our country.This paper discusses whether compa-nies participating in targeted poverty alleviation have the higher investment value from the perspective of volatility and tail risk of corporate assets.This paper estab-lishes a single-cycle company investment decision model including poverty alleviation projects,and obtains in theory relationship between participating in poverty allevi-ation and company asset volatility and tail risk.Then,using the data of A-share listed companies from 2016 to 2020,this paper examines the impact of involvement in targeted poverty alleviation on the company's stock risk.The empirical results show that,being consistent with theoretical expectations,involvement in targeted poverty alleviation can significantly reduce volatility,idiosyncratic volatility and tail risk of the company's stock.And the impact of poverty alleviation on company asset risk is particularly significant in non-state-owned companies,companies with high investor confidence and those with good poverty alleviation effects.The mechanism analysis shows that involvement in targeted poverty alleviation can reduce the risk of company stock through improving the company's operating performance and the quality of company information disclosure.The research of this paper provides strong theoretical and empirical support for companies to actively fulfill their social respon-sibilities,and believes that companies participating in targeted poverty alleviation have relatively high investment value both from the perspective of risk management and value investment.
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