Stakeholder trust is a major driver of corporate performance, but its benefits are difficult to identify empirically. This paper provides new evidence on the role of social capital on firm value employing a sudden increase in inflation as exogenous variation in stakeholder trust. Analyzing the cross section of U.S. stock returns from 2018 through 2022, we find that in months following higher inflation rates, equity investors reward firms with stronger social capital, as proxied by their corporate social responsibility (CSR) levels. The result holds using different measures of inflation and CSR. The effect is stronger for firms headquartered in Democratic U.S. states (those most exposed to the “corporate greed” narrative of inflation) and ex-ante higher trust regions, as well as for firms with higher levels of customer awareness, customer sensitivity, and intangible capital. Analyst forecast revisions provide additional evidence that cash flow considerations drive the observed inflation-hedging property of CSR. Overall, the findings spotlight inflation as a crisis in stakeholder trust and provide new insights into the importance of social capital for firm value.