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Examining the nonlinear relationships of corporate social responsibility, innovation and construction firm performance: the moderating role of construction firms' competitive position

Xian Zheng (Department of Investment, Zhongnan University of Economics and Law, Wuhan, China)
Jiawei Deng (Department of Investment, Zhongnan University of Economics and Law, Wuhan, China)
Xiangnan Song (School of Management, Guangzhou University, Guangzhou, China)
Meng Ye (School of Economics and Management, Southwest Jiaotong University, Chengdu, China)
Lan Luo (School of Civil Engineering and Architecture, Nanchang University, Nanchang, China)

Engineering, Construction and Architectural Management

ISSN: 0969-9988

Article publication date: 1 December 2022

51

Abstract

Purpose

Corporate social responsibility (CSR) and innovation are the two main approaches firms utilize to promote sustainable development. However, as yet, scholars have reached no consensus regarding their precise impact on construction firm performance (CFP), hindering efforts to implement effective sustainable development strategies that improve CFP. In view that a simple linear relationship may not be sufficient to capture their precise pattern, this study aims to unveil the nonlinear impact of CSR and innovation on CFP, especially when construction firms take up a distinct competitive position.

Design/methodology/approach

This study first proposed four hypotheses to establish a new theoretical model by incorporating CSR, innovation, CFP and construction firms' competitive position (CFCP). Then the model was tested by using 292 annual observations collected from 75 construction firms in China. A multiple regression model analysis was carried out to analyze the survey data and validate the hypotheses.

Findings

The results reveal that both CSR and innovation have a U-shaped impact on the price-to-book ratio of a construction firm, a specific CFP measure. CFCP negatively moderates the U-shaped relationship between CSR and CFP, but positively moderates the U-shaped relationship between innovation and CFP.

Originality/value

This study goes beyond a simple linear view, instead of unveiling the nonlinear U-shaped effects of CSR and innovation on CFP that deepen the understanding of their complex relationships in the construction industry and makes construction firms aware that CSR and innovation can only improve performance if they reach a certain level. The moderating role of CFCP provides important implications for construction firms seeking to adopt appropriate competitive strategies related to social responsibility and innovation that both promote CFP and achieve sustainable development.

Keywords

Acknowledgements

This study greatly supported by the National Natural Science Foundation of China (No. 71901220, 71904032, 71901113, 72061025), the Fundamental Research Funds for the Central Universities (No. 2722021BZ015), and the Guangdong Philosophical and Social Science Program (grant No. GD22YGL08).

Citation

Zheng, X., Deng, J., Song, X., Ye, M. and Luo, L. (2022), "Examining the nonlinear relationships of corporate social responsibility, innovation and construction firm performance: the moderating role of construction firms' competitive position", Engineering, Construction and Architectural Management, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/ECAM-03-2022-0286

Publisher

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Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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