Comparing the Effects of Internationalization on CSR in Service and Non-Service MNEs

We examine the question, “What is the effect of internationalization on the CSR performance of firms in service sectors compared to non-service sectors?”. Drawing on a stakeholder and institutional theory-based perspective, we hypothesize: (1) in non-service firms, their social performance increases steadily with increasing internationalization, while the relationship between internationalization and their environmental performance follows an S-shape pattern; (2) in service firms, internationalization has little effect on both social and environmental performance at low to medium levels of internationalization but strong positive effects at high levels of internationalization. We tested our hypotheses with panel data on 4,693 publicly listed MNEs in 41 economies from 2002 to 2021. The results supported our hypotheses.