How optimally distinctive CSR strategy affects firm performance: a temporal-spatial perspective

Purpose The corporate social responsibility (CSR) strategy serves as a pivotal element for firms striving to achieve sustainable development. However, existing research lacks a comprehensive exploration of the conflict between “being different” and “being the same.” Using the optimal distinctiveness theory, the paper aims to analyze the impact of CSR strategic distinctiveness on firm performance across various life cycle stages and industries. Design/methodology/approach The authors use a fixed-effects model to conduct regression analysis on a sample of 9,587 A-share listed firms in China from 2013 to 2022. All data were sourced from the China Stock Market and Accounting Research Database. Findings During the growth stage, within-industry distinctiveness positively influences firm performance, whereas between-industry distinctiveness negatively affects it. Conversely, in the maturity stage, within-industry distinctiveness becomes detrimental to performance, whereas between-industry distinctiveness demonstrates a positive effect. During the decline stage, neither within-industry nor between-industry distinctiveness significantly impacts firm performance. Originality/value In this paper, the authors deconstruct the process of achieving optimal distinctiveness in CSR strategy from both temporal and spatial perspectives, thereby enriching the dynamic and multidimensional understanding of the optimal distinctiveness theory and providing valuable insights for firms to implement sustainable CSR strategy.