CORPORATE SOCIAL RESPONSIBILITY AND FINANCIAL PERFORMANCE: MEDIATING ROLE OF ORGANIZATIONAL REPUTATION AND MODERATING EFFECT OF STRATEGIC BUSINESS MANAGEMENT

Abstract

Background: Corporate social responsibility (CSR) has emerged as a central concern in contemporary business strategy, with scholars and practitioners recognizing its potential to influence both intangible assets, such as reputation, and tangible outcomes, such as financial performance. In Pakistan’s textile sector, which accounts for the majority of export earnings and is under growing international pressure for sustainability compliance, understanding the CSR–performance nexus is particularly critical. Purpose/Aim: This study aims to examine the impact of CSR on financial performance in large textile firms in Pakistan, while investigating the mediating role of organizational reputation and the moderating effect of strategic business management (SBM). By integrating stakeholder theory and the resource-based view, the research seeks to clarify how CSR initiatives create value in an emerging-market context. Methodology: A quantitative, cross-sectional design was employed, and survey data were collected from managers in large-scale textile firms. Structural equation modeling (SEM) using SmartPLS was applied to test the hypothesized relationships, ensuring robust assessment of measurement and structural models. Findings: Results demonstrate that CSR positively influences financial performance, with organizational reputation mediating this relationship, thereby confirming reputation as a critical intangible asset. However, SBM did not moderate the CSR–performance link. The study highlights CSR’s strategic value in enhancing competitiveness while revealing contextual limitations of strategic alignment in this sector.