Abstract

This study develops an internal–external institutional framework that explains why firms act in socially responsible ways in the emerging country context of China. Utilizing a mixed method of in-depth interviews and a survey study of 225 Chinese firms, the author found that internal institutional factors, including ethical corporate culture and top management commitment, and external institutional factors, including globalization pressure, political embeddedness, and normative social pressure, will affect the likelihood of firms to act in socially responsible ways. In particular, implicit ethical corporate culture plays a key role in predicting different aspects of corporate social responsibility, while external institutional mechanisms mainly predict market-oriented CSR initiatives. This study contributes to the research on CSR antecedents by showing that in the emerging economy of China, CSR toward nonmarket stakeholders is more closely intertwined with corporate tradition and values, while legitimacy-seeking CSR activities are still limitedly rewarded.