Doing Good or Doing Too Much? Corporate Social Responsibility, Information Asymmetry, and the Nonlinear Dynamics of International Expansion

Abstract

Scholars have documented that corporate social responsibility (CSR) is critical to firm performance, yet its impact on international expansion remains underexplored. CSR not only serves as a signaling mechanism in international markets but also entails substantial resource commitments. Drawing on signaling theory and resource orchestration theory (ROT), we examine how these competing forces shape the CSR-international expansion relationship. Using panel data from Chinese manufacturing firms and fixed-effects models, we find a U-shaped relationship between CSR performance and international expansion, with a turning point at a CSR score of approximately 16.41. In addition, we examine how the public (media attention) and professionals (analyst attention) can shape the U shape. We show that media and analyst attention can flatten the U-shape, with analyst attention also shifting the turning point to higher levels of CSR performance. Our study highlights the nonlinear role of CSR in international expansion and the trade-offs firms face when “doing good” in global markets.