Abstract: This paper focuses on the influence of religion, one of the classic informal systems, on the donation behavior of China’s listed companies. By making use of internet maps provided by Baidu and Google to fix longitude and latitude of the place of registry of every China’s listed company and the site of every nationally famous monastery and temple, it manually collects the religious data from both the corporate level and the provincial level. By making use of the donation and religious data from China’s listed firms from 2004 to 2010, this study finds that the probability and strength of corporate donation are positively correlated with religious factors significantly. Further analysis indicates that the positive correlation between religious factors and corporate donation is under the negative regulation of political connections, which reveals that political connections and religion have a mutual-substitution effect on corporation donation. These conclusions may evoke the attention from the fields of economics and management to the informal institutional arrangement--religion.

Key words: religion; political connections; corporate donations; informal institutional arrangements