Beyond the spotlight: CSR decoupling in response to rivals’ CSR awards

While CSR awards are widely used to promote ethical conduct, their potential to paradoxically generate unintended consequences by intensifying symbolic compliance has been largely overlooked. Based on institutional logic theory, we theorize that rivals’ CSR awards heighten the conflict between market and social logics for non-winning firms, driving them towards CSR decoupling. Using a difference-in-differences model with 1,518 firm-year observations of Chinese publicly listed firms from 2010 to 2019, we find that after rivals have won CSR awards, non-winning firms significantly increase CSR decoupling. Furthermore, competitive intensity and award rarity strengthen the effect of rivals’ CSR awards on non-winning firms’ CSR decoupling. Our findings enhance the understanding of institutional complexity, while extending the research on CSR decoupling and awards by identifying the negative inter-organizational spillover effect of CSR awards. Practically, the results suggest that regulators should strengthen monitoring, enforcement, and transparency mechanisms to ensure that CSR award systems foster substantive rather than symbolic compliance.