Corporate Social Responsibility and Organizational Resilience to COVID-19 Crisis: An Empirical Study of Chinese Firms

Abstract

Resilience captures firm capability to adjust to and recover from unexpected shocks in the environment. Being latent and path-dependent, the manifestation of organizational resilience is hard to be directly measured. This article assesses organizational resilience of firms in the context of the COVID-19 pandemic with pre-shock corporate social responsibility (CSR) performance as a predictor that positively influences the level of organizational resilience to the external shock caused by the pandemic. We develop three theoretical mechanisms based on stakeholder theory, resource-based theory, reputation perspective and means-end chain theory to explain how CSR fulfillment in the past could help firms maintain stability to adapt to and react flexibly to recover from the crisis. We examine the relationship in the context of the systemic shock caused by COVID-19, using a sample of 1597 listed firms in China during the time window from 20 January 2020 to 10 June 2020. We find that companies with higher CSR performance before the shock will experience fewer losses and will take a shorter time to recover from the attack.

A qualitative study of the first batch of medical assistance team’s first-hand experience in supporting the nursing homes in Wuhan against COVID-19

“…At the same time, paying attention to the adequacy of their rest time and the diet. Because the high sense of social responsibility, awe of life and professional values of saving lives and healing the wounded, timely encouragement and reward will contribute to their work [ 27 – 29 ].…”

Corporate Social Responsibility in Times of Crisis: Covid-19

“…A crisis can be described in the general sense as a sequence of events (most probably unexpected) caused by internal or external factors, rapidly developing, undesired these can be threatening to the business and its environment. 19 Crisis situations present a challenge for companies and "the recent extraordinary COVID-19 pandemic is not just the largest healthcare challenge of this century but it disrupts jobs (mass unemployment or reduced working hours on the labor market), the economy (some sectors are highly affected, e.g., tourism)…" 20 In these circumstances, the concept of CSR comes to the fore, because then the social expectations of the company increase. 21 Research shows that CSR in times of crisis has "an insurance-like function that mitigates the negative impact."…”

“…Based on the analysis of each article, the author divided the activities and role of corporate social responsibility in the Covid- 19 a) Gürlek; Kılıç 47 divided CSR for community-oriented activities into three categories, namely CSR for health workers, the well-being of the local population, and health organizations. In particular, the hotels offered free accommodation for health professionals, donated protective equipment to the local population, and offered their facilities for health professionals.…”

“…have proven that CSR has had a positive impact on increasing the psychological capital of employees which includes: self-efficacy, hope, resilience, and optimism of employees through their satisfaction with corporate COVID-19 responses. In a sample consisting of 374 Vietnamese full-time employees in hotels, Vo-Than et 35 Jakulevičienė, L.; Gailiūtė-Janušonė, D., The scope of legal expectations from business in human rights: carrot or stick?, Entrepreneurship and Sustainability Issues, Vol.…”

CSR Practices in Food and Beverage Companies During Pandemic

“…This underlines the importance of CSR despite the pandemic. Although it cannot preserve the shareholders' wealth (Bae et al, 2020), a high CSR performance before the pandemic could maintain companies' stability with fewer losses, and help them to adapt and recover from the crisis much faster (Huang, Chen, & Nguyen, 2020).…”