The moderating effect of CSR on the relationship between the level of change and social stability and firm performance

Abstract

This study analyzes how corporate social responsibility (CSR), the level of change, and the stability of CSR actions impact a firm's financial performance. Using panel data from S&P 500 companies (2009–2017), the results show that isolated increases in CSR do not improve financial results unless they are based on a consistent trajectory. Furthermore, it is confirmed that previously high levels of CSR reduce the impact of further changes, reflecting diminishing marginal returns. Unexpectedly, greater stability in CSR has a negative effect, suggesting that excessive stability can be interpreted as a lack of dynamism. Furthermore, stability limits the positive impact of the intensity of change. These findings underscore the importance of dynamically managing CSR to maintain stakeholder engagement and achieve sustainable results.