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Does CSR reputation mitigate the impact of corporate social irresponsibility?

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  • Meijui Sun

    (Ming Chuan University)

  • Ming-Chang Huang

    (National Yunlin University of Science and Technology)

Abstract

This study investigates the valuation and performance effects of corporate social responsibility (CSR) and irresponsibility (CSiR) activities adopted by 72 CSR-awarded and 87 nonawarded listed firms in Taiwan. Focusing on 1368 CSR/CSiR events during 2008–2011, this study provides an overview and a comparison of CSR/CSiR activities in an emerging Asian economy and focuses on the reputation and buffering effects of CSiR events. The results show that CSR activities are accompanied by improved performance. Compared with nonawarded firms, when CSR-awarded firms experience CSiR events, their investors impose stricter punishments. Consequently, the performance of CSR-awarded firms is inferior to that of nonawarded firms. This empirical work shows that firms with high CSR reputations are not buffered from the consequences of scandal and clarifies the incongruent and mixed findings regarding the CSR–performance relationship in the existing literature.

Suggested Citation

  • Meijui Sun & Ming-Chang Huang, 2022. "Does CSR reputation mitigate the impact of corporate social irresponsibility?," Asian Business & Management, Palgrave Macmillan, vol. 21(2), pages 261-285, April.
    • Handle: RePEc:pal:abaman:v:21:y:2022:i:2:d:10.1057_s41291-020-00134-y
    DOI: 10.1057/s41291-020-00134-y
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