Whether an innovation act as a catalytic moderator between corporate social responsibility performance and stated owned and non‐state owned enterprises' performance or not? An evidence from Pakistani listed firms

The objective of the study is to signify the impact of corporate social responsibility performance on state‐owned and non‐state‐owned enterprises' performance. The contributive concept of CSR performance has been formulated while contemplating total tax, staff expenditure, public welfare expenditure, social cost and total equity. To contemplate with deep insight, the moderating role of innovation input and output has been substantiated through empirical results. The data of 502 listed companies on Securities and Exchange Commission of Pakistan has been endorsed for years 2009–2018. Empirical underpinnings reveal that corporate social responsibility performance boosts the non‐state‐owned enterprises' performance vehemently while state‐owned enterprises have proclaimed insignificant results. Comprehensively, innovation input has decelerated the Non‐state owned Enterprises' performance while innovation output has remained insignificant. Specifically, leverage has been signified as the most deterrent vehicle for declining the Non‐State Owned Enterprises' performance. Intuitively, the theoretical contribution is manifested while deducing the implicative aspect of legitimacy theory which emphasizes on the adoption of corporate social responsibility. Implicatively, the study recommends to ameliorate the corporate structure of state‐owned enterprises comprehensively so that advantage of corporate social responsibility may be attained vigorously. Doubtlessly, empirical results are reliable and authenticated due to the execution of GMM and 2SLS instrumental regressions.