5 Conclusions
Overall, our research suggests that firms regard adjustments to CSR concerns as investment decisions, influenced by the availability of economic resources. We show that resource gains reduce CSR concerns, while resource losses increase them. This finding contributes to the CSR literature by providing the first known empirical and causal evidence of a link from resource availability to CSR concerns. This evidence complements recent findings documenting a link from CSR to firm performance (e.g., Benlemlih & Bitar, 2016; Cheng et al., 2014), suggesting the possibility of a bidirectional process and possibly a feedback loop. Future research could fruitfully investigate the intriguing possibility of reciprocal causation.
Additionally, our results show that the relative impact of economic resources on CSR concerns depends on several organizational variables that influence the structure of a firm’s investment priorities (financial constraint, political climate, CEO compensation, and analyst scrutiny). These results extend past findings documenting a link between such factors and CSR itself (e.g., Preston and O’Bannon, 1997; Waddock and Graves, 1997; Harjoto and Jo, 2011; Hong and Kostovetsky, 2012; Di Giuli and Kostovetsky, 2014; Benlemlih & Bitar, 2016), suggesting that these factors influence not only a firm’s absolute level of CSR, but also its willingness to change CSR policy in response to exogenous forces.
