Strengthening CSR Outcomes: The Synergistic Effects of ESG and Whistleblowing on Firm Performance

The growing pressure on firms to align financial performance with sustainable, ethical, and socially responsible business practices has received limited attention, especially in emerging markets. Addressing this gap, the present study examines the interaction between corporate social responsibility (CSR), environmental, social, and governance (ESG) performance, whistleblowing mechanisms, and firm performance in Chinese listed companies over the period 2010–2024. A rigorous empirical strategy is employed, incorporating two‐way and three‐way interaction models alongside static and dynamic fixed‐effects regressions with Driscoll–Kraay standard errors. To mitigate endogeneity concerns, both static and dynamic two‐stage least squares (2SLS) and generalized method of moments (GMM) techniques are utilized. The results provide several important findings. First, CSR is positively associated with firm performance. Second, higher ESG performance strengthens the positive effect of CSR on firm performance. Third, the presence of robust whistleblowing mechanisms further enhances this relationship. Finally, the three‐way interaction analysis reveals that whistleblowing mechanisms and ESG performance jointly enhance the positive effect of CSR on firm performance. Further, the analysis of ESG pillar scores revealed that social and governance pillar scores positively moderate the relationship between CSR and firm performance, whereas the environmental pillar score has no significant moderating effect. The findings offer important implications by demonstrating that CSR is not merely symbolic but a strategic driver of firm performance. Managers should integrate CSR with robust ESG practices to amplify its impact, while establishing effective whistleblowing mechanisms to enhance transparency and accountability. The complementary role of ESG performance and whistleblowing systems suggests that firms benefit from a holistic governance approach. Socially, these results reinforce the value of ethical conduct and stakeholder trust, indicating that responsible business practices contribute to sustainable outcomes and societal well‐being.