More Bang for Their Buck: Why (and When) Family Firms Better Leverage Corporate Social Responsibility

Family firms take different strategic actions because of their desire to grow and preserve socioemotional wealth (SEW), but pursuing SEW also generates what we call SEW resources that deliver advantages in certain contexts. We develop and test this idea with respect to corporate social responsibility (CSR). We theorize that SEW resources such as reputation, strong stakeholder relationships, and long-term orientation help family firms better leverage symbolic CSR to enhance short-term firm performance and better leverage substantive CSR to enhance long-term firm performance. Regression analyses on a 20-year panel of S&P 500 firms provide supportive evidence. Findings indicate that family firms not only do it differently to preserve SEW; they sometimes do it better because of SEW.

Automated summary

Family firms take different strategic actions to grow and preserve socioemotional wealth. This study shows that family firms can leverage their SEW resources, such as reputation and strong stakeholder relationships, to enhance short-term and long-term firm performance through symbolic and substantive CSR.