Does national culture influence corporate social responsibility on firm performance?

Hsiao-Fen Hsiao, Tingyong Zhong () and Jun Wang
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Hsiao-Fen Hsiao: Newhuadu Business School of Minjiang University
Tingyong Zhong: School of Accounting of Chongqing Technology And Business University
Jun Wang: Chinese academy of Fiscal Sciences

Palgrave Communications, 2024, vol. 11, issue 1, 1-9

Abstract: Abstract In recent years, the influence of corporate social responsibility (CSR) on firm performance has received increasing attention, with academic research deepening in this field. This study introduces national culture as a moderating variable and explores the relationship between national culture, CSR, and firm performance to determine the role of national culture in the impact of CSR on firm performance. Data of listed companies from 15 different countries, between 2011 and 2020, were collected for empirical analysis. Comprehensive environmental, social and governance (ESG) score was used to measure the degree of CSR fulfillment. The results reveal that CSR hinders firm performance. In terms of national culture, power distance index, and uncertainty avoidance have a negative relationship with firm performance, while individualism has a positive impact. Conversely, power distance index can enhance the negative correlation between CSR and firm performance. This study suggests that governments should appropriately intervene in the implementation of CSR and take the initiative to foster a national cultural climate of individualism and democracy.

Date: 2024
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DOI: 10.1057/s41599-023-02538-5

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