The preventive value effect of firm innovation: the impact of COVID-19

The COVID-19 pandemic has exerted great pressure on firms to secure their survival and transformation in the face of external shocks. Firm innovation is an important way to effectively respond to external shocks and improve the contingency and dynamic capabilities of enterprises. This study uses China's Shanghai and Shenzhen A-share listed companies as the research sample to examine the preventive value of firm innovation given the impact of COVID-19 and verifies the moderating effect of enterprise internal control and corporate social responsibility. The findings show a significant positive correlation between firm innovation and cumulative excess return during the event window. The moderating effect test shows that internal control and corporate social responsibility have a positive moderating effect on the relationship between firm innovation and the event window, indicating that the two can enhance the preventive value of firm innovation in light of COVID-19.