Abstract

This paper develops an empirically grounded, processual view of corporate social performance (CSP) by analyzing how internal organizational processes affect a firm’s social performance. Based on two case studies, we argue that changes in a firm’s social performance are triggered by continuously reoccurring instances of poor fit between the firm’s routines and its institutional environment. We propose that reactive change processes, initiated by stakeholder critique threatening the organization’s legitimacy, will result in isomorphic type of social performance changes. In comparison, proactive change processes, initiated by slack resources, are more likely to result in nonisomorphic type of social performance changes. Furthermore, we propose that top-down driven processes will result in structural social performance changes in the direction of internationally influential stakeholders’ demands, while bottom-up driven processes will result in output social performance changes in the direction of locally influential stakeholders’ demands.