“Is it too late to mend?” — Unlocking the impact of organizational stigma on corporate performance in organizational change

Purpose This study explores how firms respond to stigma-induced organizational change and its impact on corporate performance. Specifically, it examines corporate social responsibility (CSR) as a mediating mechanism to determine whether actively engaging in CSR during stigmatized organizational change improves performance. Additionally, it investigates the moderating roles of government regulatory distance and environmental uncertainty. Design/methodology/approach Using panel data from Chinese A-share listed companies from 2011 to 2021, this study analyzes how organizational stigma affects corporate performance. It further examines the mediating role of CSR and the moderating effects of government regulatory distance and environmental uncertainty through regression analysis. Findings Organizational stigma reduces corporate performance. Actively fulfilling social responsibility helps mitigate the negative impact of organizational stigma on performance, playing a mediating role in this relationship. Government regulatory distance weakens the effect of organizational stigma on CSR, while environmental uncertainty enhances the relationship between CSR and corporate performance. Originality/value This study analyzes how organizational stigma – as a distinct form of external pressure that compels strategic organizational change – affects corporate performance. This study deepens the understanding that when organizations face stigma-driven changes, actively engaging in CSR can mitigate the negative impact of organizational stigma. It also explores the moderating roles of government regulatory distance and environmental uncertainty, providing valuable insights for both academic research and practical applications in the field of management.