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How Does Environmental Corporate Social Responsibility Matter in a Dysfunctional Institutional Environment? Evidence from China

Author

Listed:
  • Zelong Wei

    (Xi’an Jiaotong University)

  • Hao Shen

    (Xi’an Jiaotong University)

  • Kevin Zheng Zhou

    (University of Hong Kong)

  • Julie Juan Li

    (City University of Hong Kong)

Abstract

Drawing on institutional and signaling theories, this study examines how environmental corporate social responsibility (ECSR) affects firm performance in a dysfunctional institutional environment. We extend the ECSR literature by suggesting that ECSR indirectly influences firm performance through the mediating effects of business and political legitimacy. Based on a dataset of 238 firms in China, we find that ECSR affects business and political legitimacy followed by firm performance. Moreover, legal incompleteness weakens and legal inefficiency strengthens the effects of ECSR on business and political legitimacy.

Suggested Citation

  • Zelong Wei & Hao Shen & Kevin Zheng Zhou & Julie Juan Li, 2017. "How Does Environmental Corporate Social Responsibility Matter in a Dysfunctional Institutional Environment? Evidence from China," Journal of Business Ethics, Springer, vol. 140(2), pages 209-223, January.
    • Handle: RePEc:kap:jbuset:v:140:y:2017:i:2:d:10.1007_s10551-015-2704-3
    DOI: 10.1007/s10551-015-2704-3
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    References listed on IDEAS

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