Sukrit Singh Puri

Why do firms participate in politics? Scholars tend to assume instrumental intent behind corporate political activity, describing firms as making profit-maximizing investments in the political arena. However, I show that for the most common type of firm in the world, the family firm, non-economic incentives may shape its politics. I argue a family's control over corporate resources and its embeddedness in social networks predict the family firm to deviate from a purely opportunistic political strategy, and instead reflect social motivations and kinship ties. I assemble the universe of corporate campaign contributions to political parties in India from 2003-2021 and develop a new measure of family involvement in firm operations by using demographic details from a company's board of directors. I find that despite operating in a competitive multi-party environment, family firms tend to loyally support a single co-ethnic political party, with little evidence that this strategy pays dividends in the form of private political favors. These findings update our priors on why we think corporations participate in politics in the first place, provide a new explanation for why corporate returns to politics remain elusive, and highlight the need to examine a firm's internal structure to understand its political activity.

Why do companies choose to hide potentially beneficial political connections? I show that revealing political activities can hurt a company's valuation in the short run by tainting its reputation. I take advantage of a unique setting where the Election Commission of India suddenly revealed a list of previously-anonymous corporate donors to political parties. Publicly listed companies revealed to be political donors experienced a 1.5% cumulative abnormal underperformance over the next 7 days as a result of this information shock, amounting to an erosion of approximately $9 billion in market capitalization---over 5 times the amount raised by political parties in the first place. The effect is short-lived and is largely driven by companies facing negative press immediately following the reveal.

The study of money in politics has largely remained restricted to developed countries, where data are more readily available. But the concerns about corporate political funding, and how business influences the state broadly, are a global phenomenon. I collect all donations to political parties in India between 2003-2021, by taking advantage of a successful Right to Information Act that require all political parties to disclose donations made above Rs 20,000 (approx 250 USD). By developing a web-scraping based entity resolution algorithm that outperforms conventional exact and fuzzy string matching techniques, I am able to uniquely identify the universe of over 7000 corporate donors making donations to 40 political parties over the 18 year period. In this paper, I describe the steps taken to construct this dataset, describe a set of five stylized facts about the nature of corporate-political linkages in the world's largest democracy, and highlight a set of empirical puzzles that challenge expectations from the literature and invite future scholarship on this topic.

The period leading into an election exerts competing forces on private investment decisions of firms: on one hand, pre-election uncertainty tends to increase risk premium and reduce a firm's appetite for new investments, on the other hand, politicians demand greater private investment as campaign promises to win voter support. Which force dominates? I collect the universe of large industrial investment decisions from 1998-2022 by firms in India, and find evidence for a theory of political bargaining, where politicians are able to arm-twist local firms into increasing investment promises at economically inopportune times.

The 2013 update to the Companies Act in India required all large corporates to spend 2% of trailing three-year net profit on Corporate Social Responsibility (CSR). In this project, we examine granular project-level CSR spending data and use staggered state-level elections to study how political influence may shape when, where, and how firms allocate their CSR budgets.

A detailed multi-wave survey of family businesses in India probing the nature and extent of family involvement in corporate governance, strength of social and ethnic attachments of the controlling family, and series of market and non-market decisions of the firm, inlcuding hiring, financing, political participation. Currently in pilot.