Drivers of corporate social responsibility and firm performance for sustainable development—An institutional theory approach

Abstract

Chinese companies are aware of the importance of corporate social responsibility (CSR) nowadays, but the drivers of CSR practices or activities are unknown. To bridge this research gap, this study examined the links between both internal and external factors and firm performance in the Chinese context and developed a new theoretical framework integrating the indigenous characteristics of CSR in China to predict the factors that affect Chinese CSR. Data from 530 Chinese managers from manufacturing and non-manufacturing firms were collected via a survey through SoJump (sojump.com) and analysed using structural equation modelling. One internal institutional factor (top management commitment) and three external factors (environmental legislative pressure, peer imitation pressure and normative social pressure) were found to strongly and positively predict CSR practices. The major contribution of this study is that, it demonstrates the intervening role of CSR practices in strengthening firm performance from a management perspective.