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Corporate social responsibility's influence on firm risk and firm performance: the mediating role of firm reputation

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  • Zia ur Rehman
  • Asad Khan
  • Asim Rahman

Abstract

The aim of the article is to analyze the influence of corporate social responsibility (CSR) initiatives by firm on firm performance and firm risk. Moreover, the mediating role of firm reputation in CSR/performance and CSR/risk relationship is also examined. Data were collected from European and Asian firms listed on Fortune's Most Admired Countries for the period 2014–2018. Using logit regression model and OLS regressions, we find that CSR has a significant positive influence on firm reputation and firm performance whereas on firm risk it is negative. Based on our results, we also confirm that firm reputation does mediate the relationship between CSR‐firm performance and CSR‐firm risk. This study adds to CSR related literature by providing more reliable and objective evidence on the role of firm reputation in CSR engagement and also provides direction for future studies in this context.

Suggested Citation

  • Zia ur Rehman & Asad Khan & Asim Rahman, 2020. "Corporate social responsibility's influence on firm risk and firm performance: the mediating role of firm reputation," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(6), pages 2991-3005, November.
    • Handle: RePEc:wly:corsem:v:27:y:2020:i:6:p:2991-3005
    DOI: 10.1002/csr.2018
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