Corporate Social Responsibility Disclosure Approaches, Corporate Reputation, and Corporate Performance: Evidence from China

Abstract

Corporate social responsibility (CSR) entails balancing economic, social, and environmental aspects of business activities. The CSR report, a crucial non-financial disclosure tool, enables firms to effectively communicate their CSR strategies, actions' impacts, achievements, and shortcomings to stakeholders. It plays a pivotal role in shaping corporate reputation and performance. Therefore, enhancing CSR report quality is of great importance. This study examines the relationship between Corporate Social Responsibility Disclosure Approaches (CSRDA) and corporate performance, with consideration of corporate reputation's role in this connection. By drawing from stakeholder theory, signaling theory, and reputational capital theory, we address the gap in understanding CSRDA and corporate reputation (CR) linkage. Using the System-Generalized Method of Moments (SYS-GMM) and bootstrapping techniques, we explore this relationship in a dataset of 943 publicly listed Chinese companies from 2011 to 2019, accounting for incomplete CSR data during the pandemic period from 2020 to 2022. Our results indicate a positive association between CSR disclosure approaches and corporate performance, mediated by corporate reputation.