Does innovativeness matter in the relationship between lobbying and customer satisfaction?
(A2024-119919)

AUTHORS

M. Abrahim Zaka, Avans University of Applied Sciences

ABSTRACT

Firms lobby to produce a favorable regulatory business environment. Typically lobbying produces positive financial outcomes for firms through a favorable regulatory environment, but it comes at the expense of losing customer focus and harms customer satisfaction. I extend the literature about the dark side of lobbying by examining an important mediator, namely firm innovativeness, and how it mediates the relationship between lobbying and customer satisfaction. I find that the impact of lobbying on customer satisfaction is partially positively mediated by firm innovativeness, but a negative direct relationship exists directly between lobbying and customer satisfaction. Furthermore, corporate social responsibility (CSR) reduces the direct negative affect of lobbying on customer satisfaction. The contribution of my research is that loss in customer satisfaction because of lobbying can be overcome by focusing on innovativeness, and firm CSR activity can align lobbying activity with customer priorities.