Corporate social responsibility as a strategic resource: examining the mediating role of corporate reputation in securing competitive advantage

Abstract

Corporate social responsibility (CSR) is increasingly described as a strategic intangible resource. Yet, the mechanism by which it converts into competitive advantage (CA) remains underspecified, and evidence from the Gulf Cooperation Council (GCC) economies is limited. Drawing on stakeholder theory and the resource-based view (RBV), this study examines corporate reputation (CR) as the pathway that links CSR to CA in organizations operating in the United Arab Emirates (UAE). A cross-sectional survey design was adopted. Structured questionnaires were delivered to 200 managers using convenience sampling, with 150 valid responses retained. The measurement quality was evaluated using exploratory factor analysis, average variance extracted (AVE), composite reliability, and the Fornell–Larcker criterion. We addressed common method variance through procedural remedies and Harman’s single-factor test. Hypotheses were tested using ordinary least squares regression and bootstrapped mediation analysis (PROCESS Model 4, 5,000 resamples), controlling for firm age, organization size, and organization type. CSR was positively associated with CR ( B  = 0.746, p  < 0.001) and CR was positively associated with CA ( B  = 0.403, p  = 0.001). The total effect of CSR on CA was positive and significant ( B  = 0.526, p  < 0.001); however, the direct effect was not significant once CR entered the model ( B  = 0.226, p  = 0.061). The indirect effect through CR was significant [ B  = 0.301, 95% bootstrap CI (0.079, 0.507)] and accounted for approximately 57.2% of the total effect, indicating an indirect-only (full) mediation. The results suggest that CSR relates to competitive advantage mainly through corporate reputation, rather than directly affecting competitive position. Reputation therefore appears to operate as the conversion mechanism that translates stakeholder approval into a resource position that is valuable, rare, and difficult to imitate.