Unlocking the potential of CSR: An explanatory model to determine the strategic character of CSR activities

Expectations about the fact that companies should take a proactive interest in societal and environmental issues have significantly increased over the last decades across key business stakeholders. Thus, corporations have responded to this demand by developing a set of activities under the umbrella concept of Corporate Social Responsibility (CSR) action plans. However, the efficiency and impact of this wide array of practices has not yet been established in a conclusive way. The objective of this study is to develop a strategic framework that guides managers in making their decisions about which CSR activities have the most positive and business-building impact in corporate performance. To accomplish this end, this study has validated a measurement scale that, in turn, has been applied to 257 managers from companies operating across 10 different sectors of activity. Data has been analyzed through a structural equations model (SEM) and a partial least square (PLS) statistical approach. Additionally, we have conducted an extensive research of the latest meta-analyses on the topic to align conclusions. Results suggest that the most efficient CSR activities, improving corporate performance, fit into four strategic categories, namely: enhancement of relationships with stakeholders, generation of business opportunities, strengthening brand equity, and maximization of corporate media and communication strategies. Notably, the main results stress that brand equity, projected by CSR initiatives, has a positive influence in the strategic nature of CSR, which may drive company performance. Lastly, this research points out limitations and highlights potential areas of application of the findings.