Corporate Resilience to Recover from Shocks: The Role of Corporate Social Responsibility and Corporate Reputation

The main objective of this study is to investigate the effect of Corporate SociaL ResponsibiLity (CSR) discLosure on corporate resilience. Furthermore, this study also analyzes the mediating effect of corporate reputation on the effect of CSR disclosure on corporate resilience. This study used a sample of all companies listed on the Indonesia Stock Exchange from 2017 to 2020. The sample in this study was 222 companies with a total of 444 observations. Ordinary Least Square (OLS) was used as a data anaLysis technique. The resuLts indicate that corporate reputation was vitaL in mediating the effect between corporate social responsibility and corporate resilience. It reveals that investors in Indonesia considered the company’s reputation in times of crisis in addition to CSR. Other findings show that CSR and corporate reputation negatively affect the Loss severity and recovery time. It demonstrates that investors in Indonesian stock markets are more concerned with CSR disclosure and the company’s reputation when experiencing a shock. Companies with good CSR and a superior reputation have better corporate resilience than companies with bad CSR and an unfavorable reputation. Good CSR can be one of the factors that can increase company resilience; however, CSR must be carried out continuousLy to buiLd an exceLLent corporate reputation so that, in the Long term, that cannot be determined when shocks occur. The roLe of corporate reputation can help companies rise more quickly and suffer fewer Losses than other businesses.