Corporate social responsibility and stock-price crash risk: test of regulation mechanism based on institutional ownership and internal control

Addressing financial risks draws attention from both government and academia. Current studies primarily focus on the impact of CSR on stock-price crash risk, overlooking the regulatory role of institutional ownership and internal control, and the mediating effect of analyst coverage. This paper investigates the relationship between CSR and stock price crash risk using data from A-share listed companies (2015-2021). Findings suggest that better CSR helps reduce stock-price crash risk. The mediating effect test shows that improved CSR attracts analysts' attention and enhances information transparency, thus reducing stock-price crash risk. Institutional ownership, internal control and CSR have substitution relations in inhibiting stock-price crash risk. Further research shows CSR's significant role in reducing stock-price crash risk for non-state-owned, eastern regions, and non-Big Four audited enterprises. This study enriches literature on stock-price crash risk and CSR and guide firms in reducing stock-price crash risk, promoting capital market development and enhancing enterprise evaluation systems.