The intensity of environmental scandals, responsible innovation, and corporate resilience: The moderating role of relational trust

Abstract

Research on the reasons contributing to the heterogeneous effects of environmental scandals on corporate performance remains limited. This study examines the factors of corporate resilience (CR) and employs event system theory to investigate the roles of responsible innovation (RI) and relational trust (RT) in shaping the relationship between environmental scandal intensity (ESI) and CR. We focus on examining the mediating role of RI in the relationship between ESI and CR and consider the moderating effect of RT. Analyzing survey data from 211 Chinese companies, we find that RI significantly mediates the inverted U‐shaped impact of ESI on CR. Moreover, RT regulates this relationship. These findings help extend our knowledge on the practice of CR when a scandal occurs and during its aftermath.