Transforming CSR into Sustainable Value: The Role of Green Intellectual Capital and Circular Economy

Abstract

This study empirically examines the relationship between corporate social responsibility (CSR) and sustainable performance by proposing a sequential mediation model incorporating green intellectual capital (GIC) and circular economy (CE) practices. Drawing on the resource-based view, this study posits that CSR initiatives foster the development of environmentally oriented intangible resources, namely green human, structural, and relational capital, which collectively constitute GIC. Data were collected from large manufacturing firms, and the proposed model was tested using partial least squares structural equation modeling (PLS-SEM). The findings posits that the transition from CSR to sustainable performance is not direct but occurs through the development of GIC, which in turn facilitates effective CE implementation. By embedding circular practices, firms can achieve long-term environmental stewardship, economic viability, and social value creation. The framework contributes to sustainability literature by integrating CSR, knowledge-based resources, and circular strategies into a unified pathway toward sustainable performance. It also offers practical insights for managers and policymakers seeking to leverage responsible governance and green capabilities to drive competitive advantage while addressing global sustainability challenges.