Good Enough! Are Socially Responsible Companies the More Successful Environmental Innovators?
In contrast to the link between Corporate Social Responsibility (CSR) and financial performance, the connection between CSR and innovation has so far lacked research attention. This chapter investigates whether CSR and environmental innovations complement each other in such a way as to generate higher financial performance if both are present simultaneously compared to only one or none of them. We analyze if environmental innovators can increase their financial performance by signalling their environmental engagement through CSR. We use panel data on environmental R&D together with a CSR variable on the Global Reporting Initiative (GRI) and analyze their effect on financial performance. Although our results suggest that environmental R&D and the GRI are complementary, we cannot conclude that this is also true for other types of CSR.
This work is part of the project Impact Measurement and Performance Analysis of CSR (Corporate Social Responsibility), funded by the EU (7th Framework Program), Brussels, BE. We are indebted to the participants of the seminars and workshops held in Évora, Frankfurt (Oder), Mannheim, and Toulouse for their comments.
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