By S Arunachalam, Hariom Manchiraju, Rahul Suhag, Praveen K Kopalle
Production and Operations Management | March 2026
https://doi.org/10.1177/10591478251329011
Arunachalam, S., Manchiraju, H., Suhag, R., & Kopalle, P. K. (2025). Social Heart and Business Sense: Translating Corporate Social Responsibility into Gross Margin Premium per Mandatory Corporate Social Responsibility Law in India. Production and Operations Management, 34(10), 3042-3062.
Production and Operations Management, March 2026
This research assesses the impact of Indian government-mandated firms’ corporate social responsibility (CSR) related investments on gross margins. Using a multimethod approach, we show (a) a positive relationship between CSR investments and gross margin and (b) the moderating role of advertising investment. The contribution of our research is three-fold. First, our results suggest that mandating firms to spend on CSR can be a win-win situation for firms and governments, as opposed to the view of considering mandatory CSR as an additional burden. Second, our inquiry is one of the first to analytically and empirically show CSR contribution positively affects gross margin premium, which is based on price, important revenue-generating marketing, and operations construct. Third, we show the moderating role of advertising in achieving CSR-related gross margin premium. We discuss our study's implications for marketing and operations managers and policymakers.
Prof. Hariom Manchiraju is an Associate Professor of Accounting at the Indian School of Business (ISB). His research examines the role of accounting information in capital markets, the economic consequences of regulation, ESG reporting, executive compensation, and corporate governance. His work has been published in leading academic journals, including Journal of Accounting Research, Journal of Accounting and Economics, The Accounting Review, Contemporary Accounting Research, and Review of Accounting Studies. He is also one of the founding editors of Accounting Theory and Practice, a research journal focused on India and published by Elsevier.
At ISB, he teaches core courses in Financial Accounting and the Financial Statement Analysis elective in the PGP program. In the FPM program (PhD equivalent), he teaches a course titled Capital Market Research in Accounting. His doctoral students have been placed at leading business schools, including the Indian Institute of Management Ahmedabad.
Prof. Manchiraju holds a PhD and MBA from the State University of New York at Buffalo, a Master of Financial Management (MFM) from Sri Sathya Sai Institute of Higher Learning, and a Bachelor’s degree in Commerce from Osmania University.
