**1. Introduction**

Innovation-driven development strategies have become the guiding principle of business enterprises in many areas of China. For the business community, striving to turn technological innovation into a new driver for sustainable development is an important strategic option for firms wishing to gain a competitive advantage [1,2]. At the same time, the academic community has also conducted in-depth discussions on enterprise innovation investment. In general, such research mainly revolves around two main lines: one is the relationship between innovation investment and firm performance, and most existing studies have reached a relatively consistent conclusion on this, believing that the two have a positive relationship [3]; the second concerns the influencing factors of enterprise innovation investment [4], regarding which scholars have carried out exploratory analyses from different perspectives. For example, Paik and Woo (2017) [5] focused on the impact of a company's venture capital, founder's responsibilities, etc. on R&D investment strategies, while Pan et al. (2021) [6] discussed the heterogeneous impacts of carbon dioxide emission reduction policies on innovation investment, from the perspective of corporate ownership.

Meanwhile, corporate social responsibility (CSR) and corporate performance also garnered significant attention. In their seminal work on CSR, McWilliams and Siegel (2000) [7] found that the omission of innovation input variables was an important reason for the inconsistencies between CSR and corporate performance in the existing literature; they revealed a possible positive relationship between CSR and innovation investment, from the perspective of corporate strategy theory. Since then, some scholars have emphasized the potentially positive role of CSR in stimulating corporate product innovation [8], but they have yet to conduct an empirical analysis of the relationship between the two. In

**Citation:** Chen, L.; Lim, S.H.; Xu, S.; Liu, Y. Corporate Social Responsibility and Innovation Input: An Empirical Study Based on Propensity Score-Matching and Quantile Models. *Sustainability* **2023**, *15*, 671. https://doi.org/10.3390/ su15010671

Academic Editors: Akrum Helfaya and Ahmed Aboud

Received: 7 November 2022 Revised: 23 December 2022 Accepted: 24 December 2022 Published: 30 December 2022

**Copyright:** © 2022 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/).

recent years, some empirical studies have emerged, but there is still no consensus on the relationship between corporate social responsibility and innovation investment [9–12].

For example, Gallego-Álvarez et al. (2011) [13] conducted a two-way discussion on CSR and innovation investment, based on the resource-based theory, and found that these two types of corporate decision-making showed a negative relationship. Subsequently, Bocquet et al. (2013) [14] used a questionnaire method to investigate Luxembourg companies; they divided CSR into its strategic and responsive dimensions to test their respective relationships with research and development (R&D) innovation. The results show that the performance of corporate strategic social responsibility has a positive impact on the innovation of products and processes, while responsive social responsibility hinders the R&D of enterprises. Bocquet et al. (2019) [14] further showed that implementing strategic CSR via nationality diversity led to technological innovations among small- and medium-sized enterprises. Luo and Du (2015) [15] enabled an enterprise to enhance its relationship with its stakeholders; this relationship helped facilitate the exchange of knowledge between the two parties, which led to further R&D investment and stronger innovation.

The inconsistent findings in past empirical research studies may be due to the macroeconomic conditions and other factors of the countries of the enterprises studied, as well as model selection. Most studies have been conducted on enterprises outside China [13,16,17]. In contrast, the empirical literature on the direct role of CSR regarding innovation investment in China is relatively rare, and most of the CSR indicators in similar studies use individually selected financial indicators, which lack the necessary persuasiveness and universality. On the other hand, from a practical point of view, enterprises need to obtain various factors of production from society; therefore, establishing explicit or implicit contracts with resource providers (stakeholders) is inevitable, besides meeting the consumers' expectations [18–20]. In order to obtain continuous support from stakeholders and consumers, enterprises must strive to meet their demands for product and service quality and for corporate engagement in social and environmental causes [21–23]. At the same time, increasing the intensity of innovation investment, enhancing the product or service quality, improving enterprise competitiveness, and obtaining the recognition of consumers are the ultimate goals for the existence and growth of enterprises [24,25]. Therefore, social responsibility and innovation investment are important parts of the strategic framework of enterprises [26]; in light of their limited resources and financial constraints, enterprises must balance their decisions between pursuing CSR, to foster good will and attract external support, and focusing on research and development to enhance the enterprise's competitiveness. Should an enterprise rely on a social responsibility strategy via the active fulfillment of social responsibility, in exchange for stakeholders' support, and then create a harmonious environment for enterprise development? Alternatively, should an enterprise rely on a high-risk, high-reward innovation-driven strategy to foster product competitiveness? Should it pursue both social responsibility and innovation?

In view of the current theoretical research background and the empirical questions of current enterprise practice, this paper first uses the propensity score-matching method to test the impact of the voluntary disclosure of social responsibility information on innovation investment because "voluntary disclosure" is a decision-making arrangement of enterprises that is based on certain factors, rather than the result of random behavior. The use of ordinary regression methods is prone to a resulting bias, while the propensity score-matching method can be solved effectively, based on the "counterfactual" research framework. In addition, regarding the sample of "voluntary disclosure" and taking the relatively authoritative Runling Social Responsibility Rating index as the proxy variable of corporate social responsibility, this paper uses the ordinary least squares (OLS) method and the quantile regression model to explore the impact of social responsibility performance on innovation investment. The OLS model is limited to examining the impact of CSR performance on the mean value of innovation input, while the quantile model can further analyze the marginal effect of social responsibility performance at the main quantiles of innovation input. In summary, the improvement of research methods may be beneficial

for discussion of the relationship between CSR and innovation input so as to facilitate the conclusion of more accurate and reliable research conclusions, in order to bring useful enlightenment to strategic decisions on topics such as corporate social responsibility and innovation investment.

### **2. Theoretical Analysis and Hypothesis**

#### *2.1. Voluntary Release of a Social Responsibility Report and Corporate Social Responsibility*

Since the middle and late 1970s, Western enterprises have reported information such as employee development and corporate environmental initiatives, in addition to disclosing their financial situation, showing the rudiments of enterprises publishing social responsibility information. Guthrie and Parker (1989) [27] wrote that in the early 1980s, the Australian Broken Hill Proprietary Company not only disclosed its financial data but also information on employee development and community involvement in its annual report; it began to pay attention to the performance of corporate social responsibility. Due to the sluggish development of China's capital market, an imperfect market mechanism, the non-standard supervision system during the economic transition period, and the general lack of public awareness of CSR, all sectors of society had mostly ignored the disclosure of social responsibility information for many years [28,29]. At the turn of the century, however, China's business and academic circles began to pay attention to this issue. The Shenzhen Stock Exchange, Shanghai Stock Exchange, state-owned Assets Supervision and Administration Commission of the State Council (SASAC), and other government departments have successively given more specific guidance and suggestions on the disclosure content, form, and mechanism of CSR reports. Since then, increasingly more publicly listed companies have begun to pay attention to the disclosure of social responsibility information.

At present, social responsibility reports have become a link between enterprises and stakeholders and are also a comprehensive embodiment of CSR [30]. the releases of social responsibility, especially voluntary releases, can show the outside world the efforts made by enterprises in social causes, and highlight to stakeholders the responsibility of enterprises and the enterprise's intent to contribute to societal goals. At the same time, studies have shown that the disclosure of information such as social responsibility (environmental responsibility) represents the degree of fulfillment of the corresponding responsibilities of enterprises [31].

#### *2.2. CSR and Innovation Input, according to the Viewpoint of Stakeholder Theory*

According to stakeholder theory, enterprises must not only assume responsibility to internal stakeholders such as shareholders and employees but also fulfill their responsibilities to external stakeholders, such as consumers, suppliers, creditors, governments, communities, and the general public. The demand for responsibility from internal and external stakeholders constitutes internal pressure for enterprises to increase their investment in innovation. Specifically, this includes the care taken by enterprises to support their employees by creating a safe and tidy working environment and a comfortable working atmosphere [32,33]; however, taking responsibility for shareholders, creditors, and suppliers means that enterprises must continue to enhance their competitiveness and profitability as a necessary assurance of stakeholders' interests. This responsibility to the government, the community, and the general public requires enterprises to adopt new, environmentally friendly, and cleaner production operations, and to continuously improve in terms of reducing pollution emissions and strengthening waste recycling. In a market with intense competition, this is necessary in order to avoid consumers "voting with their feet" [34].

In other words, CSR is instrumental in fostering and strengthening the relationships between firms and their stakeholders, and such strong relationships, in turn, enable firms to leverage the pool of external knowledge among their stakeholder networks, including their customers. In fact, consumers are the direct audience of enterprise products or services; their perceptions and expectations of products could influence the outcomes of a firm's performance [35]. For example, a consumer's "warmth and perceptions" about a firm are

influenced by the firm's CSR efforts and initiatives [35]. A firm's CSR efforts help personify the image of the firm, draw consumers toward the products or services, and even identify with the firm's CSR positions [35,36]. Consumer feedback and insights are conducive to enterprise innovation as they convey information on market preferences, trends, and potential needs [37]. Possessing external market knowledge and information is key to broadening the firm's knowledge base and supporting new product development [15].

In addition, they will also actively explore the development and supply of new materials, such as for energy conservation and environmental protection, and even participate in early product design in enterprises. The government and the public can express their own demands to the enterprise before a product is launched, to avoid an embarrassing situation regarding complaints after the product has been launched. The biggest reward to the employees of an enterprise is mainly reflected in the sense of ownership [32,33] and high enthusiasm for participating in product development and process updates. The above favorable conditions will induce enterprises to carry out and strengthen their innovation activities. Furthermore, the network of shareholders and creditors may not only help enterprises via knowledge and information-sharing but also provide necessary financial support for enterprises to develop and innovate [15,35].

Additionally, the fulfillment of social responsibility can help enterprises to burnish their images and generate goodwill. As an important intangible asset of an enterprise, reputation takes a long time to build, but it is very easily ruined and can be lost in a short time due to "careless moves" [38]. Based on this finding, companies with excellent social responsibility performance can send a positive message to the market and are more likely to attract potential consumers. The favor of the market has become an inexhaustible driving force for enterprises wishing to maintain this virtuous circle and competitive advantage, which is conducive to encouraging enterprises to continue to innovate and produce more high-quality and inexpensive products. The promotion of the R&D innovation of enterprises has also become an important path for CSR to create business value [39]. Based on the above analysis, this study examines the following hypotheses:

**H1:** *Compared with enterprises that do not publish social responsibility reports, enterprises that voluntarily publish them make a greater investment in innovation.*

**H2:** *For companies that voluntarily disclose their social responsibility reports, the more active the social responsibility performance, the higher the investment in innovation.*

The resource-based theory points out that fulfilling social responsibilities and implementing innovative activities are the key options for enterprises to achieve differentiated operations. Companies can focus their limited resources on social responsibility, or they can focus on R&D innovation or other channels. For enterprises with high investment in innovation and more successful R&D activities, the high-quality products (services) that they provide to the market give them a competitive edge over their competitors in the same industry. According to the empirical evidence presented by Hull and Rothenburg (2007) [27], the impact of social responsibility performance on the performance of innovation-active enterprises is weaker than on those with low innovation levels. Following the resource-based theory, the following hypothesis is formulated:

**H3a:** *Based on the resource-based view, with the increase in innovation investment, the impact of social responsibility performance on an enterprise's innovation investment gradually weakens.*

That means that if H3a were true, one would expect the effect of social responsibility performance on innovation investment to be smaller for enterprises with low innovation investments, and larger for those enterprises with high innovation investments.

Conversely, the knowledge-based theory and organizational learning theory give a diametrically opposite view. From the perspective of knowledge-learning processes, such as enterprise knowledge acquisition, identification, absorption, and transformation, we can explain the driving effect of innovation investment intensity on enterprise learning ability. Because of investment activity that promotes technological progress [40], enterprises will accumulate successful experience and cultivate the necessary R&D skills and innovation awareness via this kind of practice. Even if the innovative project fails, companies can learn from it to avoid similar mistakes in subsequent R&D innovations. This means that innovation activities improve the learning ability of enterprises. Cohen and Levinthal (1990) [41] pointed out that enterprises with high R&D investment are more likely to absorb and utilize external knowledge because they have certain technical reserves and knowledge reserves. Social responsibility provides opportunities for companies to carry out innovative activities [42]. High-innovation enterprises are more capable of acquiring and identifying constructive ideas from stakeholders and putting them into practice in research and development than those with low innovation inputs. Based on the above analysis, the following hypothesis is proposed:

**H3b:** *According to the knowledge-based view, the impact of social responsibility performance on an enterprise's innovation investment increases with the level of innovation investment.*

That means that the higher the level of innovation investment, the larger the effect is of social responsibility performance on innovation investment. The knowledge-based hypothesis is the opposite of the resourced-based hypothesis, H3a.
