Corporate Social Responsibility: a Theory of the Firm Perspective
TL;DR: In this article, the authors outline a supply and demand model of corporate social responsibility (CSR) and conclude that there is an "ideal" level of CSR, which managers can determine via cost-benefit analysis.
Abstract: We outline a supply and demand model of corporate social responsibility (CSR). Based on this framework, we hypothesize that a firm's level of CSR will depend on its size, level of diversification, research and development, advertising, government sales, consumer income, labor market conditions, and stage in the industry life cycle. From these hypotheses, we conclude that there is an “ideal” level of CSR, which managers can determine via cost-benefit analysis, and that there is a neutral relationship between CSR and financial performance.
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TL;DR: This article conducted a meta-analysis of 52 studies and found that corporate virtue in the form of social responsibility and, to a lesser extent, environmental responsibility is likely to pay off, although the operationalizations of CSP and CFP also moderate the positive association.
Abstract: Most theorizing on the relationship between corporate social/environmental performance (CSP) and corporate financial performance (CFP) assumes that the current evidence is too fractured or too variable to draw any generalizable conclusions. With this integrative, quantitative study, we intend to show that the mainstream claim that we have little generalizable knowledge about CSP and CFP is built on shaky grounds. Providing a methodologically more rigorous review than previous efforts, we conduct a meta-analysis of 52 studies (which represent the population of prior quantitative inquiry) yielding a total sample size of 33,878 observations. The meta-analytic findings suggest that corporate virtue in the form of social responsibility and, to a lesser extent, environmental responsibility is likely to pay off, although the operationalizations of CSP and CFP also moderate the positive association. For example, CSP appears to be more highly correlated with accounting-based measures of CFP than with market-based ...
6,493 citations
TL;DR: In this paper, the authors propose an institutional theory of corporate social responsibility consisting of a series of propositions specifying the conditions under which corporations are likely to behave in socially responsible ways, and argue that the relationship between basic economic conditions and corporate behavior is mediated by several institutional conditions: public and private regulation, the presence of nongovernmental and other independent organizations that monitor corporate behaviour, institutionalized norms regarding appropriate corporate behavior, associative behavior among corporations themselves, and organized dialogues among corporations and their stakeholders.
Abstract: I offer an institutional theory of corporate social responsibility consisting of a series of propositions specifying the conditions under which corporations are likely to behave in socially responsible ways. I argue that the relationship between basic economic conditions and corporate behavior is mediated by several institutional conditions: public and private regulation, the presence of nongovernmental and other independent organizations that monitor corporate behavior, institutionalized norms regarding appropriate corporate behavior, associative behavior among corporations themselves, and organized dialogues among corporations and their stakeholders. Concerns about corporate social responsibility have grown significantly during the last two decades. Not only has the issue become commonplace in the business press and among business and political leaders (Buhr & Graf
3,806 citations
Cites background from "Corporate Social Responsibility: a ..."
...Many of them define corporate social responsibility as actions taken by a firm that are intended to further social welfare beyond the direct economic, technical, and legal interests of the firm (e.g., Davis, 1973; McWilliams & Siegel, 2001)....
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TL;DR: In this article, the authors classify the main CSR theories and related approaches in four groups: (1) instrumental theories, in which the corporation is seen as only an instrument for wealth creation, and its social activities are only a means to achieve economic results; (2) political theories, which concern themselves with the power of corporations in society and a responsible use of this power in the political arena; (3) integrative theories, focusing on the satisfaction of social demands; and (4) ethical theories based on ethical responsibilities of corporations to society.
Abstract: The Corporate Social Responsibility (CSR) field presents not only a landscape of theories but also a proliferation of approaches, which are controversial, complex and unclear. This article tries to clarify the sit- uation, ''mapping the territory'' by classifying the main CSR theories and related approaches in four groups: (1) instrumental theories, in which the corporation is seen as only an instrument for wealth creation, and its social activities are only a means to achieve economic results; (2) political theories, which concern themselves with the power of corporations in society and a responsible use of this power in the political arena; (3) integrative theories, in which the corporation is focused on the satisfaction of social demands; and (4) ethical theories, based on ethical responsibilities of corporations to society. In practice, each CSR theory presents four dimensions related to profits, political performance, social demands and ethical values. The findings suggest the necessity to develop a new theory on the business and society relationship, which should integrate these four dimensions.
3,629 citations
Cites background from "Corporate Social Responsibility: a ..."
...Concern for profits does not exclude taking into account the interests of all who have a stake in the firm (stakeholders)....
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...An adequate level of investment in philanthropy and social activities is also acceptable for the sake of profits (McWilliams and Siegel, 2001)....
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TL;DR: In this paper, five dimensions of CSR are developed through a content analysis of existing CSR definitions, and frequency counts are used to analyse how often these dimensions are invoked, concluding that the existing definitions are to a large degree congruent.
Abstract: Despite numerous efforts to bring about a clear and unbiased definition of CSR, there is still some confusion as to how CSR should be defined. In this paper five dimensions of CSR are developed through a content analysis of existing CSR definitions. Frequency counts are used to analyse how often these dimensions are invoked. The analysis shows that the existing definitions are to a large degree congruent. Thus it is concluded that the confusion is not so much about how CSR is defined, as about how CSR is socially constructed in a specific context. Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment.
3,342 citations
Cites background from "Corporate Social Responsibility: a ..."
...…one that runs a profitable business that takes account of all the positive and negative environmental, social and economic effects it has on society McWilliams and Siegel, 2001 Actions that appear to further some social 10 Voluntariness good, beyond the interests of the firm and Social that which…...
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TL;DR: In this paper, the authors describe the contributions to knowledge provided by the commentaries and articles contained in this issue and outline some additional areas of research wherein the resource-based view can be gainfully deployed.
2,901 citations
References
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TL;DR: In this paper, the major features of the behavior of advertising can be explained by advertising's information function, and it is shown that the most important information conveyed by advertising is simply that the brand advertises.
Abstract: This paper tries to show how the major features of the behavior of advertising can be explained by advertising's information function. For search qualities advertising provides direct information about the characteristics of a brand. For experience qualities the most important information conveyed by advertising is simply that the brand advertises. This contrast in advertising by these qualities leads to significant differences in its behavior. How does advertising provide information to the consumer? The producer in his advertising is not interested directly in providing information for consumers. He is interested in selling more of his product. Subject to a few constraints, the advertising message says anything the seller of a brand wishes. A mechanism is required to make the selling job of advertising generate information to the consumer. [Авторский текст]
3,065 citations
TL;DR: This paper extended earlier research concerning the relationship between corporate social performance and corporate financial performance, with particular emphasis on methodological inconsistencie... and showed that methodological inconsistency is a major obstacle in the analysis.
Abstract: This article extends earlier research concerning the relationship between corporate social performance and corporate financial performance, with particular emphasis on methodological inconsistencie...
1,929 citations
Posted Content•
TL;DR: In this article, the authors extend earlier research concerning the relationship between corporate social performance and corporate financial performance, with particular emphasis on methodological inconsistencies, and they use the five most commonly applied accounting measures in the Corporate Social Performance and Corporate financial performance (CSP/CFP) to assess corporate financial performances.
Abstract: This article extend earlier research concerning the relationship between corporate social performance and corporate financial performance, with particular emphasis on methodological inconsistencies. Research in this area is extended in three critical areas. First, it focuses on a particular industry, the chemical industry. Second, it use multiple sources of data -- two that are perceptually based (KLD Index and Fortune reputation survey), and two that are performance based (TRI database and corporate philanthropy) in order to triangulate toward assessing corporate social performance. Third, it use the five most commonly applied accounting measures in the corporate social performance and corporate financial performance (CSP/CFP) to assess corporate financial performance. The results indicate that the a priori use of measures may actually predetermine the CSP/CFP relationship outcome. Surprisingly, Fortune and KLD Indices very closely track one another, whereas TRI and corporate philanthropy differentiate between high and low social performers and do not correlate to the firm's financial performance.
1,868 citations
"Corporate Social Responsibility: a ..." refers background in this paper
...This framework allows us to develop a set ' For a review of theoretical and empirical studies of the relationship between corporate social performance and financial performance, see Griffin and Mahon (1997)....
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