Exploring the Role of Awareness in the CSR-CFP Relationship

After more than seven decades and thousands of scholarly works on the topic, the question of whether corporate social responsibility (CSR) positively impacts a firm’s performance has yet to find consensus. To date, extant research has found evidence of a positive, negative, and, in some cases, no relationship between CSR and firm performance. This paper tackles one of the possible reasons why the literature has experienced incongruent results. Specifically, this paper explores the role of CSR on firm performance when the assumption of stakeholder awareness is met. The results show that firms did experience an increase in firm performance once they made their stakeholders aware of their CSR activities. The role of awareness has major implications for research as it opens a brand-new path of investigation that focuses on the signal firms use, such as CSR reports, to make stakeholders aware of their activities.