How can Corporate Social Responsibility Lead to Firm Performance? A Longitudinal Study in Taiwan

Abstract

In a longitudinal study of 106 firms in Taiwan, we find that corporate image mediates the relationship between customer-oriented corporate social responsibility (CSR) and customer loyalty but not the employee-oriented CSR-collective organizational commitment linkage. Significantly and unexpectedly we find corporate image mediates the relationship between employee-oriented CSR and customer loyalty. We find positive and indirect relationships between customer-oriented CSR, customer loyalty and financial performance. The findings of this study improve our understanding of the mechanism by which CSR practices influences firm performance.