Environmental Corporate Social Responsibility Practices and Firm Innovation : Complementarities and Empirical Evidence from Spanish Firms

This paper studies the complementarity effect of combining different Environmental Corporate Social Responsibility (ECSR) practices on innovation. We apply the ‘Complementarity Approach’ to test whether the adoption of the three ECSR practices studied (fewer materials per unit produced, less energy per unit produced or practices decreasing the environmental impact) generates supper-additive effects on firm’s innovation measured in terms of innovation adoption, radical innovation and incremental innovation. The empirical analysis is based upon the Spanish Community Innovation Survey (CIS) from 2009 to 2014. The results show that the best combination of ECSR practices depends on the innovation type. For innovation adoption all the three possible combinations exert super additive-effects, whereas for both radical and incremental innovations we find different complementarity patterns. For radical innovation, less energy per unit appears as a key in fostering innovation when it is combined with even fewer materials or decreasing the environmental impact. For incremental innovation, the combination of the three ECSR practices reports complementarity effects. Finally, these results provide useful guidelines for the design of Corporate Social Responsibility (CSR) strategies combining different ECSR practices to foster firm innovation