The effect of supplier CSR practices on sales performance with major customers in B2B markets

Abstract

If supplier firms motivate their major customers to boost sales performance, they can gain a significant competitive advantage. This study draws on the signaling theory and the strategic CSR literature to explore how and when supplier CSR practices affect their sales performance with major customers. Using data from 1,294 Chinese publicly listed firms for the period from 2010 to 2019, this study indicates that supplier CSR practices increase sales performance with major customers. This association is stronger when major customers also proactively engage in CSR. Furthermore, the interaction effect between supplier and customer CSR practices is strengthened when the geographical distance between supplier and customer firms is greater and when industry competition is strong. The findings provide theoretical and managerial implications for the strategic role of CSR in supplier–customer relationships in B2B markets.