Doing good and doing bad: The impact of corporate social responsibility and irresponsibility on firm performance

• Published in: Journal of business research Vol. 80; pp. 82 - 97
• Main Authors: Price, Joseph M., Sun, Wenbin
• Format: Journal Article
• Language: English
• Published: Elsevier Inc 01.11.2017
• Subjects: Corporate social irresponsibility; Corporate social responsibility; Firm idiosyncratic risk; Firm value; Market value; Corporate social irresponsibility; Corporate social responsibility; Market value; Firm value; Firm idiosyncratic risk
• ISSN: 0148-2963; 1873-7978
• DOI: 10.1016/j.jbusres.2017.07.007

Research on firm performance and corporate social performance (CSP) has recently broadened to concurrently evaluate corporate social irresponsibility (CSI) with corporate social responsibility (CSR). However, little is known about the underlying mechanisms that impact the performance relationship, particularly the duration of the influence of CSR initiatives and CSI incidents and the impact of the interaction of CSR and CSI on firm performance. This research expands understanding by examining the combined impact of “doing good” and “doing bad” to allow a more robust examination of a firm's regime in pursuing a better strategic position through social performance. We examine the effects of CSR and CSI and their combined effects using a moderating high-low matrix. The empirical findings provide two uniquely interesting findings: CSI incidents have a longer enduring effect than CSR initiatives and those firms doing little CSR and little CSI perform better than firms engaging in high levels of both.