The Relationship Between Corperate Social Responsibility Engagement And Firm Innovation

With the collapse of demographic dividend and resource economy,the cost advantage that has been established at the bottom of global value chain since China's reform and opening-up policy tends to be exhausted step by step.Majority of manufacturing industry at pretty low level of industrial additional value are suffering excess production capacity and the falling rate of profit,which results in lacking sustainable competitive advantage in the international market.In order to maintain persistent growth of China's economy,China's government firmly advocates supply innovation and reform,industrial restructuring and upgrading of economic development mode.In terms of manufacturing firms,the nation shuts down huge amounts of firms which have a serious impact on the environment due to contamination exceeding standard and phase out obsolete capacity.Meanwhile,it strives to develop innovation-type intelligent manufacturing industry under the concept of low carbon,saving energy and protecting the environment.The preferential policies offered include revenue subsidy,industrial guidance,financial and technological support.So,in the new normalcy of economy,industrial restructuring and transformation and upgrading of China's manufacturing industry are two issues that need to deal with for firms from all sectors from subjective and objective sides.As for practical aspect,factors effecting firm innovation are mainly classified as external environment(economy,legal system,policies,culture,social opinion,industrial competition,customer demand and industrial technology change,etc.)and internal capability(entrepreneur information,value orientation,employee's enthusiasm and firm innovation culture,etc.).From the perspective of theory,firm innovation experienced such changes from technology promoting linear mode to system integration and networking open innovation for five-generation theoretical modes(Rothwell,1992).In current complex economic environment,innovation is considered as a networking activity.Internal resource and technology owned by firms generally can not satisfy the market requirement of rapid iteration and innovation of products.At this moment,if the members such as supplier,channel partners,customers and government sectors in the networking where firms are situated in are able to provide a large amount of internal resource and information of heterogeneity and rareness,the risk of innovation for firms will be decreased greatly.Based on the reflection of real examples in industrial circle,conclusion to previous literature and logical deduction by reasoning,this study put forward a topic about influencing effects of strategic corporate social responsibility(CSR)on firm innovation.According to existing research on the positive effects of corporate social responsibility engagements on firm innovation based on resource-based view(RBV).Our research found that firms can perform social responsibilities aiming at various stakeholders to gain social capital(business tie and political tie)and transform into firm competence(technical capacity and marketing capacity)on the basis of social capital theory and capacity-based view,which ultimately improves internal logic chain for firm innovation.We will study and explore cases of three typical private enterprises in manufacturing fractionized domain,propose fundamental research proposition and create study mode combining with theory analysis and give hypothesis.After that,we will carry out structural equation and path analyze of the above hypothesis and modeling according to the survey questionnaire for senior management of 212 manufacturing firms in different regions of the nation.Results of the empirical analysis shows that CSR engagement has a positive effect on its access to social capital(business tie and political tie).Also,business tie and political tie,these two types of social capital,will have a positive impact on firm technical capability.Meanwhile,these two types of social capital also influence firm marketing capability positively(and business tie are promoting marketing capability more significantly than political tie);Finally,both technology capability and marketing capability are important to firm innovation.The empirical results demonstrate that the technology capability plays a more significant role in promoting firm innovation compared with marketing capability.What's more,this research examines the moderate effect of fulfilling social responsibility on gaining social capital considering two external environment factors including market uncertainty and competition intensity.The empirical results prove that the level of market uncertainty promotes the process of firms to fulfill social responsibility in order to gain social capital.However,regulation effect of competition intensity is not that noticeable.This also means that regardless of whether firm faces high or low competition intensity,it will not affect the CSR engagement for gaining social capital.Compared with previous studies,this study mainly innovates in the following aspects:First of all,based on the relation dimensionality of social capital theory(political tie and business tie),this study explores what corresponding resources different types(primary and secondary)of stakeholders can bring for firm development.It not only further extends instrumental stakeholder theory,but also enriches firm social responsibility concept and significance at a deeper level.Secondly,this study clearly explains the inherent mechanism and logic chain of CSR engagemtn affecting the process of firm innovation for the first time from the view of firm social capital theory and capability.Though existing research discussed the relationship between CSR and firm innovation based on the perspective of resource base view and pointed out that there is positive correlation between them,there is no deep study on the influence path.Our study found that firm can obtain firm social capital by CSR engagement.In this way,it can transform into firm capacity,which ultimately influences firm innovation.It can be considered as a process of firm's strategic choice of its behavior in order to get external resource accumulation,followed by firm taking use of its external resources for organic processing and conversion of important internal capabilities that influence innovation.Moreover,through the further analysis of the above influence path,we figure out the mediating effects of firm social capital(political tie and business tie)and firm capabilities(technology capability and marketing capability)between CSR engagement and firm innovation.Therefore,it has made certain contribution to extension and development of firm capability theory.Finally,this paper expands research on corporate social responsibility of emerging markets.We choose two common hostile environment factors in the emerging markets(market uncertainty and competence intensity)as moderate variables to the procedure of doing CSR engagement to obtaining social capital.we provide a more profound theoretical foundation and practical guidance for Chinese manufacturing firms.How to fulfill CSR engagement to obtain social capital when facing different environmental characteristics.