Innovation and Corporate Social Responsibility during the Covid-19 in Ardakan (Iran)

Purpose In the last decades, the scientific efforts carried out in developed countries on CSR and innovation have shown a bidirectional relationship as an essential element for both the firms' competitiveness and reputation and the social context safeguard. The study proposes to analyse the CSR and innovation relations in an emergent country. Design/methodology/approach Based on a sample formed by 500 SMEs operating in the Ardakan area in Iran for the pandemic period between September 2021 and December 2021, the authors defined a conceptual framework in which CSR and innovation are functional for both the market economic value creation and the social and environmental safeguarding. Findings The study determined that Innovation and CSR confirmed, although not completely, the contrary hypothesis. The efforts are accomplished taking into account CSR pillars but the CSR is not the relevant cause of the innovation processes planning. Finally, in the Iranian context, the main stakeholder is the community that requires increasing amounts of information about corporate social performance. Practical implications The practical results suggest that innovation activities considering CSR issues do seem to yield insurance-like reputational protection to the firm. This could be a reason why firms engage in activities that improve their performances also in countries with an apparently closed economy. Originality/value Given the lack of empirical studies on the considered country, this research has attempted to determine the impact of CSR practices on innovation and, simultaneously, to check the effect of innovation on CSR practices, in order to test empirically whether there is a bidirectional relationship. Furthermore, the study reveals the importance of integrating social and economic stakeholders’ requirements and expectations about environmental and social concerns within a country in which the specific norms' presence is weak.