Adopting management control systems through CSR strategic integration and investigating its impact on company performance : evidence from Indonesia

Purpose: This paper aims to investigate the extent to which the management control systems (MCS) adoption in corporate social responsibility (CSR) integration into business strategy has an impact on companies’ performance. Design/methodology/approach: Using a sample of 435 Indonesian manufacturing companies, partial least squares structural equation modelling was used to investigate the impact of CSR strategic integration on companies’ performance based on the contingency and stakeholder theories. Findings: The findings reveal CSR strategic integration has a positive and significant impact on companies’ performance, including employee, operating and financial performance and the company size can positively moderate the impact of this integration on both its operating and financial performance. Practical implications: The findings can encourage managers to adopt MCS by undertaking CSR at the strategic level, resulting in superior performance, both socially and financially. Social implications: Employee performance and operating performance can significantly mediate the effect of strategic integration on financial performance. Originality/value: The paper suggests that adopting MCS through CSR strategic integration could improve company performance socially and financially. This is the very first study on this issue from an Indonesian perspective.