Are you good enough? CSR, quality management and corporate financial performance in the hospitality industry

Hospitality firms are increasingly investing in corporate social responsibility (CSR) to generate strong relationships with stakeholders while aiming to benefit their own performance. However, CSR may bring both costs and benefits to the focal firm. We analyze how corporate financial performance (CFP) is affected by CSR, finding that the impact of CSR on CFP has a U-shaped form, where CSR is a cost that translates into higher benefits only when it generates solid relationships between firms and their stakeholders. Furthermore, we adopt a contingency approach, assessing the role of quality management (QM) on the CSR-CFP relationship. We find that the simultaneous implementation of CSR and QM is less beneficial to CFP than the isolated implementation of CSR due to the redundancy of different activities aimed at similar goals, i.e., stakeholders’ satisfaction. In doing so, we advance academic understanding of the impact of CSR and QM on CFP.