ABSTRACT This paper examines how environmental responsibility (ER) affects the financial performance (FP) of Mexican listed firms, and whether this relationship varies across ownership structures and phases of the COVID‐19 crisis. Using panel data from 2018 to 2022 and firm fixed‐effects models, we document substantial heterogeneity in the ER–FP nexus. For nonfamily firms, ER is not significantly associated with FP and does not mitigate the decline in performance during the pandemic. In contrast, family firms follow a distinct pattern: ER is associated with weaker performance prior to COVID‐19, yet they exhibit greater resilience during the crisis, as reflected in a smaller decline in FP. Most notably, we document a reversal in the ER–FP relationship for family firms, whereby ER becomes financially advantageous in the post‐COVID period. These results remain robust under two‐step system GMM estimation.
García et al. (Sun,) studied this question.