Detail Cantuman

Abstract This study examines whether community social
capital in US counties, as captured by strength of civic
norms and density of social networks in the counties,
affects corporate social responsibility (CSR) of resident
corporations headquartered in the counties. Analyses of
longitudinal data from 3688 unique US firms between 1997
and 2009 provide strong empirical support for the propositions
that community social capital facilitates positive
CSR activities that benefit non-shareholder stakeholders
and constrains negative CSR activities that are detrimental
to non-shareholder stakeholders. Additionally, we explore
the effects of institutional logics arising from community
isomorphism on positive and negative CSR activities,
respectively. And, we explore the respective effects of
corporate engagement in positive and negative CSR
activities on corporate financial performance. Firms
undertake more positive CSR activities when such activities
are more prevalent among other local corporations
headquartered in the same county. But, there is no systematic
relationship between negative CSR activities and
the community-level corporate engagement in negative
CSR activities. Positive CSR activities enhance a firm’s
future financial performance, and the positive effect is
more prominent among firms headquartered in counties
with high community social capital. However, negative
CSR activities only reduce a firm’s future financial performance
among firms headquartered in counties with high
community social capital; negative CSR activities do not
affect performance among firms headquartered in counties
with lower levels of community social capital. Collectively,
these results highlight the distinct effects of local
social institutions, namely community social capital, on
positive CSR activities and negative CSR activities,
respectively.
Keywords Corporate social responsibility  Social capital 
Social norm