A cross-cultural longitudinal analysis of the effect of corporate social performance on corporate financial performance: an Asian perspective

Purpose: This study aims to investigate the relationship between Corporate Social Performance (CSP) and Corporate Financial Performance (CFP) across various cultural contexts in Asia and to explore the moderating effects of Hofstede’s cultural dimensions. Design/methodology/approach: Using a longitudinal dataset of 16,392 firm-year observations from 23 Asian countries over a span of 10 years, from 2013 to 2022, this research uses hierarchical linear modeling to assess the CSP–CFP relationship under different cultural influences. Findings: This study reveals a nuanced interplay between CSP, CFP and cultural dimensions, with individualism and uncertainty avoidance showing significant positive moderating effects, contrary to motivation and long-term orientation. Research limitations/implications: The results underscore the importance of aligning CSR initiatives with the cultural values of the region in which a company operates. However, using Hofstede’s robust dimensions may oversimplify complex cultural dynamics. Practical implications: The findings offer multinational corporations’ insights into tailoring CSR strategies to diverse cultural contexts, emphasizing the need for cultural sensitivity. Originality/value: This research extends the corporate social responsibility (CSR) literature by incorporating cultural dimensions into the CSP–CFP analysis, providing a new perspective on CSR’s effectiveness in diverse cultural settings.