This study examines the strategic responses of foreign and domestic firms to political uncertainty triggered by political turnover in China through Corporate Social Responsibility (CSR). Drawing on resource dependency theory, we propose that foreign and domestic firms adopt distinct approaches to manage their political dependence due to differing capabilities in leveraging political ties and CSR activities. Analyzing 29,273 observations from 3,599 public companies in China over the period 2009-2019, we find both foreign and domestic firms are likely to take government-aligned CSR to navigate this uncertainty as political ties are likely to be disrupted by political turnover. However, the nature of their responses varies with the level of political turnover; we find domestic firms intensify their government-aligned CSR efforts following national political turnovers, whereas foreign firms react to both city and national-level turnovers. We further identify two characteristics associated with city-level turnover—term of office and internal promotion—that moderate the relationship between political turnover and government-aligned CSR. These insights provide practical implications for both foreign and domestic firms in adopting tailored CSR strategies to manage their political dependence and navigate political uncertainty.
