Research@Ourso: Having It Both Ways
May 21, 2026
Can a firm be both socially responsible and financially performant?
Take a product off the shelf today and you might find a label proclaiming it to be sustainably sourced, environmentally friendly, or fair trade certified, examples of corporate social responsibility (CSR) in the marketplace. However, while growing customer demand has fueled CSR initiatives, business leaders faced unclear and contradicting research about their impact on the bottom line. Some studies reported that investing in CSR could harm a company’s financial performance, whereas others offer a more positive outlook.
So, can companies adjust their competitive playbooks to make their social investments truly pay off? New research published in the Journal of Business Research suggests they can. The study, co-authored by an international team including Ted Waldron, Alvin C. Copeland Endowed Professor of Business in the LSU Stephenson Department of Entrepreneurship & Information Systems, used data from public firms to show that CSR commitments can enhance profitability if they are directly integrated into a competitive strategy.
What is CSR?
Corporate social responsibility (CSR) is a business model that encourages companies to operate in ways that benefit society and the environment while still being accountable to their stakeholders and the public. Some examples of CSR include, but are not limited to:
- Environmental: reducing manufacturing emissions or using recycled materials.
- Philanthropic: donating profits to charities or sponsoring fundraising events.
- Ethical: acting fairly and ethically through methods such as transparency disclosures or offering favorable benefits for employees.
Ted Waldron
Professor
Stephenson Department of
Entrepreneurship & Information Systems
Variety Up, Volume Down
To convert good deeds into profitability, Waldron and his co-authors found that managers must pull two opposite strategic levers simultaneously. Waldron notes that getting this right requires firms to shift their gaze away from what the competition is doing and focus heavily back on the end consumer.
“Businesses, including public corporations, actually face more pressure to deliver a compelling value proposition to consumers than to maintain competitive parity with rivals,” Waldron said. “Too many executives often get up in competitive ‘tit for tat’ while tending to overlook who their businesses exist to serve and how they might do so in the most valuable possible way to those audiences.”
Lever 1:
More Complexity
Expand the variety, novelty, and diversity of marketplace moves.
Lever 2:
Less Intensity
Stop market activities that actively fight against your social investments.
Putting Theory into Practice
Inside the firm, executing this dual action playbook requires moving CSR out of the public relations area and into core operational decision-making. To achieve this, the researchers recommend that leaders focus on three internal shifts:
De-Silo Sustainability: Stop managing sustainability or corporate citizenship as a parallel checklist or a mere compliance requirement. Frontline managers across all business functions must treat social commitments as a primary asset when designing new initiatives or product lines.
Resist Volume Anxiety: It is natural for managers to feel anxious when rivals launch high-volume promotional blitzes, leading to a knee-jerk reaction to match their intensity. Leadership must build an organizational culture that is comfortable with less frequent action, focusing instead on protecting the resources required to execute a highly diverse, reputation-backed strategy.
Reframe the Investor Narrative: Use these insights to change how you communicate with investors, board members, and other stakeholders. By demonstrating clear alignment between your social investments and a competitive playbook, you can confidently show that purpose and profit happily coexist.
About the Researcher
Theodore (Ted) Waldron is the Alvin C. Copeland Endowed Professor of Business at Louisiana State University. He earned his BS and MBA from Villanova University and his PhD from The University of Georgia. In addition to his academic career, Ted has worked in hospital administration and management consulting. His research, which emphasizes theory development and qualitative research methods, has been published in top management and entrepreneurship journals and he serves as a field editor of the Journal of Business Venturing and an editor for Entrepreneur & Innovation Exchange.
About the Department
The Stephenson Department of Entrepreneurship & Information Systems (SDEIS) develops students into leaders in entrepreneurial, IT, and analytics industries. With synergistic degree offerings, co-curricular activities, and innovative minors, students receive captivating classroom and experiential learning that prepares them to succeed in any technology-based or entrepreneurial career.