The Moderating Effect of Cultural Values on the Relationship Between Corporate Social Performance and Firm Performance

Wei Shi, Kevin Veenstra

Research output: Contribution to journalArticle

Abstract

Using two national culture dimensions, we show that the influence of firms’ corporate social performance (CSP) on corporate financial performance (CFP) hinges on culture. Specifically, CFP is higher in those firms where CSR initiatives are congruent with the cultural environment. CSP has a negative impact on CFP for those firms domiciled in countries which are individualistic and favor flexibility. These findings are amplified for those firms with low levels of foreign influence in terms of institutional ownership and sales. Using a dataset covering 5334 firms from 41 different countries, our results indicate that culture and CSR initiatives have a powerful interaction effect in determining CFP, suggesting that CSP’s impact is dependent upon the culture of the country where the firm resides.

Original languageEnglish (US)
JournalJournal of Business Ethics
DOIs
StateAccepted/In press - 2020

Keywords

  • Corporate social performance
  • Cultural values
  • Firm performance

ASJC Scopus subject areas

  • Business and International Management
  • Business, Management and Accounting(all)
  • Arts and Humanities (miscellaneous)
  • Economics and Econometrics
  • Law

Fingerprint Dive into the research topics of 'The Moderating Effect of Cultural Values on the Relationship Between Corporate Social Performance and Firm Performance'. Together they form a unique fingerprint.

  • Cite this