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Dynamic Capability and Strategic Corporate Social Responsibility Adoption: Evidence from China

Author

Listed:
  • Jing Claire Li

    (School of Finance and Accounting, University of Westminster, London NW1 5LS, UK)

  • Abdelhafid Benamraoui

    (School of Finance and Accounting, University of Westminster, London NW1 5LS, UK)

  • Neeta Shah

    (School of Finance and Accounting, University of Westminster, London NW1 5LS, UK)

  • Sudha Mathew

    (School of Finance and Accounting, University of Westminster, London NW1 5LS, UK)

Abstract

An increasing number of studies have proposed that corporate social responsibility (CSR) performance depends on how firms apply their resources and capabilities to implement CSR. A firm’s ability to integrate, build, and reconfigure internal and external competencies to respond to environmental changes is its dynamic capability. Implementation of CSR at the strategic level, i.e., strategic CSR (SCSR) that requires alignment between activities and organizational configuration and structure will contribute to a firm’s sustainability. However, the research on how dynamic capabilities contribute to such alignment and SCSR adoption is incipient. This study investigates how dynamic capability influences the performance of SCSR in China. By analyzing 134 Chinese listed firms in the period 2017–2019, in this study, we found that firms with dynamic capabilities at a non-average-industrial level, i.e., higher or lower level than the average industrial level, were less likely to adopt SCSR practices, and had a low SCSR adoption performance. These results can help firms better understand dynamic capabilities and how dynamic capabilities contribute to SCSR adoption and firms’ sustainable development and operations. The policy implications of the study are also discussed.

Suggested Citation

  • Jing Claire Li & Abdelhafid Benamraoui & Neeta Shah & Sudha Mathew, 2021. "Dynamic Capability and Strategic Corporate Social Responsibility Adoption: Evidence from China," Sustainability, MDPI, vol. 13(10), pages 1-19, May.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:10:p:5333-:d:551857
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    2. Leonidou, Leonidas C. & Eteokleous, Pantelitsa P. & Christodoulides, Paul & Strømfeldt Eduardsen, Jonas, 2023. "A dynamic capabilities perspective to socially responsible family business: Implications on social-based advantage and market performance," Journal of Business Research, Elsevier, vol. 155(PA).
    3. Haifei Wang & Hongjun Wu & Peter Humphreys, 2022. "Chinese Merchant Group Culture, Corporate Social Responsibility, and Cost of Debt: Evidence from Private Listed Firms in China," Sustainability, MDPI, vol. 14(5), pages 1-18, February.

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