| Variable name | Variable symbol | Variable definitions |
| Dependent variable |
|
|
| Cost of equity capital | COE | Implied equity capital cost based on the GLS model (1) |
| Explanatory variables |
|
|
| Social integrity level | Honesty | Honest Social Environment Index in Business Environment Index |
| Control variable |
|
|
| Beta coefficient | Beta | Stock beta |
| Company Size | Lnassets | Natural logarithm of total assets at the end of the year |
| Book market value ratio | Bm | The ratio of book value of shareholders’ equity to market value |
| Business risk | Oprisk | The ratio of the sum of non-current assets at the end of the year to the total assets at the end of the year |
| Financial Risk | Finrisk | The ratio of total liabilities at the end of the year to total assets at the end of the year |
| Hand turnover rate | Turnover | The ratio of annual number of shares traded to a total number of shares outstanding at the end of the year |
| Profitability | Roa | The ratio of annual net profit to total assets at the end of the year |
| Asset turnover | Assturn | The ratio of annual operating income to total assets at the end of the year |
| Growth | Income grow | The annual operating income growth rate |
| Dividend payout ratio | Rdiv | The ratio of total annual cash dividends to the net profit |
| Equity concentration | Hfd | The sum of the squares of the shareholding ratios of the first to fifth largest shareholders at the end of the year |
| Year | Year | Set dummy variables for each year from 2005 to 2013 |
| Industry | Industry | Set dummy variables for 20 industries |