Recent research says the answer is Yes, Under Certain Conditions. Whenever corporate social performance does not clearly enhance a firm’s performance, shareholders often consider “their firm” to be pursuing actions that are in the domain of government and nonprofit organizations. Shareholders even get upset unless positive association between being socially responsible and organizational performance can be demonstrated.  Recent research examines the impact of corporate social performance on firm performance in two areas—the product and the environment, referred to as product social performance (PSP) and environmental social performance (ESP), respectively. The authors report that PSP has a stronger positive impact on firm performance compared to ESP. Specifically, Jayachandran, Kalaignanam, and Eilert report that stakeholders are likely to value social responsibility actions that are more closely aligned with the operational interests of the firm. They stress that it is important to assess the appropriateness of social responsibility activities to the basic operating environment of the firm. Otherwise, shareholders (and stakeholders), the authors report, may not reciprocate by being supportive as expected, and social responsibility expenditures may be viewed as a “misuse of shareholder funds.” In addition, the authors report that firms that do not report their social responsibility actions with sufficient clarity and specificity reap minimal if any benefits from being socially responsible. Thus, firms should clearly “promote” their social responsibility actions on the corporate website.

(Jayachandran, Satish, Kartik Kalaignanam, and Meike Eilert (2013), “Product and Environmental Social Performance: Varying Effect on Firm Performance,” Strategic Management Journal, 34, 1255-1264).