Social Goals Diversification within Firm’s Product Portfolio: The Effects on Corporate Performance.

Abstract

This paper investigates to what extent the diversification and variety of social actions - Sustainable Development Goals (SDGs) – pursued by firms and associated to their products (or services) could affect the corporate performance. To achieve our purpose, we use more than 500,000 trademarks registered between 2012-2020 by a sample of 114 for-profit firms. Exploiting a well-defined social vocabulary, we perform a text analysis on the sampled trademarks, and we assess the characteristics these firms’ products portfolio by tracking for every year the presence of social products or services associated to one of the 17 SDGs established by the United Nations. Our evidence shows that the impact on firm performance of firm’s SDGs diversification is negatively moderated both by the importance of social products in a firm’s product portfolio and by the level of firm’s product diversification. These negative relationships are stronger when firm communication is based on generic over-arching messages, rather than detailed descriptions of tangible and intangible features.