This study focuses on how social crises shape the likelihood of high-status firms making prosocial claims. We argue that a social crisis provides an opportunity for high-status firms to make prosocial claims to counteract the suspicion that they perpetuate, or are indifferent to, social problems. Further, we identify three key factors—social crisis intensity, local victims, and local counterclaimants—that are likely to influence whether high-status firms make prosocial claims during social crises. Empirically, we focus on prodiversity claims in quarterly earnings calls before and after the social crisis triggered by the May 2020 murder of George Floyd. We find that this crisis led to a significant increase in high-status firms’ propensity to make prodiversity claims. The high-status firms headquartered in cities experiencing high social crisis intensity (i.e., where riots occurred) were more likely to make prodiversity claims, whereas those in cities with a high concentration of counterclaimants (i.e., conservative cities) were less likely to do so. We find no evidence that high-status firms were more likely to make prodiversity claims when headquartered in cities with a high proportion of victims (i.e., cities with a high concentration of Black residents). Our study provides a novel perspective on social crises as opportunities for high-status firms to leverage prosocial claims to defend themselves against presumptions of poor character, and it raises important questions about whether these claims are simply acts of impression management or represent genuine efforts to engage more deeply with the communities in which these firms are embedded.
