This study contributes to the corporate social responsibility, stakeholder theory, and executive succession literature by examining the effect of corporate social irresponsibility on strategic leadership turnover. We theorize that firms’ CSiR increases the likelihood of executive turnover. We also investigate the nature of succession and successor origin following CSiR. We further examine how the CSiR–CEO succession relationship is moderated by firm visibility to stakeholders and industry dynamism. Our results, based on a dataset of 248 U.S. (...) public firms between 2001 and 2008, provide evidence that firms’ CSiR affects what is conventionally seen as primarily a market-driven decision on executive turnover, especially when firms operate in a more dynamic industry. Research contributions and implications are discussed. (shrink)

In recent years, there have been several high-profile recalls of hybrid products. If consumers perceive a global firm to be responsible for the recall, then it will reduce their brand equity. Therefore, global firms may respond in ethically questionable ways to justify themselves to important stakeholders and avoid blame. Understanding how stakeholders attribute blame for crises involving hybrid products is important to shed light on the unethical manner in which global firms might avoid blame in such situations. The research reported (...) here shows that in a hybrid product crisis, consumers show a bias in favor of the brand company and against the manufacturing company. This bias is more pronounced when the country of manufacture has an unfavorable image or when consumers lack familiarity with the recalled brand. Ambiguous recall announcements by companies that fail to provide a specific and clear reason for the product defect prompt consumers to assume that a manufacturing flaw caused the product defect. As a result, consumers reduce their attribution of blame for the brand company, and thus its brand equity is maintained. (shrink)

La Oroya, Peru, and Herculaneum, Missouri, USA, are two cities 4,000 miles apart but beset with common health and environmental risk: high levels of lead contamination. A key participant in this unfolding tale of environmental disaster has been The Renco Group, a privately held investment holding company based in New York. This case study sheds light on The Renco Group’s Corporate Social Responsibility (CSR) in a developing country (Peru) as distinct from CSR in a developed country (USA) by (...) presenting the distinctive set of formal and informal forces that shape the ethical outcome. The question – one which animates much of this case – is what mechanisms exist that work either collectively or individually to encourage or even require a privately-owned firm to act in a socially responsible manner or, more modestly, to cease activities that are deemed to harm society or the general welfare in a multi-country context? (shrink)

Business Ethics, the Environment &Responsibility, Volume 32, Issue 4, Page 1452-1469, October 2023.

Academic experience has been found to significantly impact on the attitudes and behaviors of managerial decision-makers, which in turn influences corporate strategic decisions. However, the impact of academic decision-makers on corporate ethical decisions, particularly corporate social irresponsibility (CSIR), has yet to receive due attention to date. In this study, we integrate the upper echelons theory and managerial discretion literature to examine whether and when academic CEOs (CEOs with academic experience) influence corporate social (...) class='Hi'>irresponsibility (CSIR). First, we suggest that academic CEOs discourage CSIR because they have higher moral standards; thus, their companies are less likely to engage in CSIR activities. In addition, we propose that negative attainment discrepancy (slack resources) reduces (enhances) academic CEOs' managerial discretion to incorporate their ethical preferences into their decisions, thereby weakening (enhancing) the above relationship. This study is the first to examine the relationship between academic CEOs and CSIR. Additionally, the empirical findings of this study offer crucial insights for shareholders and policymakers to prevent or mitigate CSIR effectively. (shrink)

Corporate social irresponsibility (CSI) and other questionable business incidents that appear to harm stakeholders frequently afflict firms yet draw disparate investor reactions. We address this disparity by investigating the association between firm legal orientation and investor reactions to CSI. We hypothesize the proportion of board members and top management team (TMT) executives with law degrees affects investor perceptions of firm foresight, and in turn, their judgment of blame and consequent punishment. Based on abnormal returns to 629 announcements (...) of CSI and 308 publicly traded S&P 500 firms, we find that both too small and too large a proportion of board of directors and TMT members with law degrees lead investors to mete out harsher punishment. This inverted u‐shaped link is further affected by firm size, firm risk, and industry competition. Our investigation sheds light on the link between executive education and financial performance in the context of CSI and investor perceptions of foresight. (shrink)

In this conceptual article, we argue that defining corporate social responsibility and corporate social irresponsibility as opposite constructs produces a lack of clarity between responsible and irresponsible acts. Furthermore, we contend that the treatment of the CSR and CSI concepts as opposites de-emphasizes the value of CSI as a stand-alone construct. Thus, we reorient the CSI discussion to include multiple aspects that current conceptualizations have not adequately accommodated. We provide an in-depth exploration of how researchers (...) define CSI and both identify and analyze three important gray zones between CSR and CSI: the role of harm and benefit, the role of the actor and intentionality, and the role of rectification. We offer these gray zones as factors contributing to the present lack of conceptual clarity of the term CSI, as a concept in its own right, leading to difficulties that researchers and managers experience in categorizing CSI acts as distinct from CSR. (shrink)

Corporations perform actions that can inflict harm with different levels of intensity, from death to material loss, to both companies’ internal and external stakeholders. Research has analysed corporate harm using the notions of corporate social irresponsibility and corporate crime. Critical management studies have been subjecting management and organizational practices and knowledge to critical analysis, and corporate harm has been one of the main concerns of CMS. However, CMS has rarely been deployed to analyse CSIR (...) and corporate crime. Thus, the aim of this paper is to critically analyse the perspectives of CSIR and corporate crimes on corporate harm via CMS in general and postcolonial studies in particular. The paper contributes by arguing that research on CSIR and corporate crime could be perceived as producing research that does not challenge the essence of contemporary corporation profit-seeking activities that ultimately produces corporate harm. We argue that CSIR and corporate crime are ideologies that assist in disguising the contradiction between producing shareholder value and the social good that is at the heart of the modern corporation system and the current economic system. Furthermore, the postcolonial view of CSIR and corporate crime highlights how they are based on a Western-centric view of corporate harm that ignores the realities and perspectives of the Global South, especially in situations where corporate harm leads to death in the Global South. (shrink)

Theoretical evidence suggests that corporate social irresponsibility (CSI) should produce long-lasting negative influences on firm performance. Yet, little empirical evidence exists in the literature to support this time-embedded research frame. This research was conducted by collecting a large set of firm data and by employing a series of vector autoregressive models to map out the longitudinal dynamic relationships between CSI and firm value under high versus low levels of two external factors, environmental dynamism and competition intensity, and (...) one internal factor, firm capability. The results show that CSI’s negative influences endure in scenarios such as high dynamism, high competition intensity, and low capability, but it has only a short-term impact on low-dynamism markets and does not produce significant effects on firm value under low-competition or high-capability conditions. These findings yield useful implications for CSI, resource-based theory, and environment theories as well as for managerial effectiveness of coping with social negativities. (shrink)

Business Ethics, the Environment & Responsibility, EarlyView.

A growing body of literature documents the important role played by moral outrage or moral anger in stakeholders’ reactions to cases of corporate social irresponsibility. Existing research focuses more on the consequences of moral outrage than a systematic analysis of how appraisals of irresponsible corporate behavior can lead to this emotional experience. In this paper, we develop and test, in two field studies, an extended model of moral outrage that identifies the cognitions that lead to, and (...) are associated with, this emotional experience. This research contributes to the existing literature on reactions to corporate social irresponsibility by explaining how observers’ evaluation of irresponsible corporate behavior leads to reactions of moral anger. The paper also helps clarify the difference between moral outrage and other types of anger and offers useful insights for managers who have to confront public outrage following cases of irresponsible corporate behavior. Finally, the analysis of the causes of stakeholders’ anger at irresponsible corporations opens important avenues for future research that are presented in the paper. (shrink)

Prior studies on stakeholders’ responses to firms with high prior corporate social responsibility (CSR) engaging in corporate social irresponsibility (CSIR) show inconsistent results. To explore this inconsistency, we focus on the intentionality of CSIR and draw upon cognitive dissonance theory to examine how transgressional CSIR and accidental CSIR differently influence investors’ responses to firms with high prior CSR through both emotional (e.g., anger) and cognitive (e.g., moral judgment) processes. An experimental study using a facial expression (...) analysis technology— FaceReader 5.0 (Study 1) and a scenario experiment (Study 2), reveal that high prior CSR is a double-edged sword. Specifically, high prior CSR elicits an aggravating effect on investor responses (more anger, more negative moral judgment, and more negative effects on investment) in light of transgressional CSIR, but it has a buffering effect on investor responses (less anger, less negative moral judgment, and less negative effects on investment) in light of accidental CSIR. Moreover, we find that when prior CSR and CSIR are in the same (vs. different) domain, the aggravating effect of transgressional CSIR is strengthened, but the buffering effect of accidental CSIR is weakened. Our findings provide important theoretical and practical insights into the effect of prior CSR on investor responses in cases of different CSIR. (shrink)

Business Ethics, the Environment & Responsibility, Volume 31, Issue 1, Page 17-32, January 2022.

Investors with a pro-social or sustainability agenda increasingly attempt to influence firm managers to adopt socially responsible behavior, either through positive/reward tactics or negative/punishment tactics. This paper considers how investors can use each approach to differentially influence managers to make more CSR investments. The paper uses game theory with an all-pay contest structure to model how a large institutional investor could reward firms for CSR activities by creating a socially responsible investment fund (reward contest) or punish firms via shareholder (...) activism (punishment contest). We identify conditions under which the punishment contest induces a higher level of CSR activity among firms compared to the reward contest. Managers bearing substantial private costs stemming from the activism is one such condition. Spillover effects are seen as the other managers in the economy engage in CSR to avoid being punished by the investor’s activism. This level of engagement is not the case when rewards are used—only those managers with an expectation of being rewarded increase their CSR activity in that scenario. This suggests, for example, that incorporating thresholds or tiers (e.g. gold, silver, and bronze-level winners) can increase the effectiveness of reward contests. Implications for designing both positive and negative CSR inducements are explored. We also identify the ethical dilemmas that relate to such influence attempts. (shrink)

ABSTRACTThis article examines how a firm’s prior record on corporate social responsibility influences individual stakeholders’ perceptions of corporate hypocrisy in the wake of a corporate social irresponsibility event. Our research extends extant corporate hypocrisy literature by highlighting the role of individual stakeholders’ inferences about a genuine CSR motive in their judgments of corporate hypocrisy. This can serve to differentiate perceived corporate hypocrisy from inconsistency that arises because of a lack of ability (...) and/or resources. Our research further identifies a source for such perceptions: individual stakeholders’ perceptions of firm warmth generated by a firm’s prior record of CSR. In addition, we find that when CSR and CSI are in the same domains, it can strengthen perceptions of hypocrisy. This provides direct evidence to explain why markets react differently when CSR and CSI events occur in the same domain. (shrink)

In contrast to many aspects of the social responsibility of business, CSR scholarship has been largely silent on the issue of the payment of corporate tax. This is curious because such tax payments are often considered a fundamental and easily measured example of a company’s citizenship behavior. However, because the payment of corporate tax can often be legally avoided, this activity represents a boundary condition for CSR. If the law and CSR suggest that a company should pay (...) its fair share of tax, yet many successful companies actively avoid this social obligation, should they be considered socially irresponsible. This paper explores the issue of tax avoidance and the implications it has for any credible definition and measure of CSR. It also highlights an aspect of corporate practice that is deliberately hidden from public view. (shrink)

In recent years, firms have greatly increased the amount of resources allocated to activities classified as Corporate Social Responsibility (CSR). While an increase in CSR expenditure may be consistent with firm value maximization if it is a response to changes in stakeholders' preferences, we argue that a firm's insiders (managers and large blockholders) may seek to overinvest in CSR for their private benefit to the extent that doing so improves their reputations as good global citizens and has a (...) "warm-glow" effect. We test this hypothesis by investigating the relation between firms' CSR ratings and their ownership and capital structures. Employing a unique data set that categorizes the largest 3000 U. S. corporations as either socially responsible (SR) or socially irresponsible (SI), we find that on average, insiders' ownership and leverage are negatively related to the firm's social rating, while institutional ownership is uncorrelated with it. Assuming that higher CSR ratings is associated with higher CSR expenditure level, these results support our hypothesis that insiders induce firms to over-invest in CSR when they bear little of the cost of doing so. (shrink)

This paper explores the relationship between attitudes to corporate social responsibility (CSR) and the cultural dimensions of business activity identified by Hofstede & Hofstede using a sample of nearly 90,000 stakeholders drawn from 28 countries. We develop five general propositions relating attitudes to CSR to aspects of culture. We show that the propensity of consumers to punish firms for bad behaviour varies in ways that appear to relate closely to the cultural characteristics identified by Hofstede. Furthermore, this variation (...) appears to be understandable in terms of the standard interpretation of the Hofstede dimensions, suggesting that cultural variation in the attitudes of consumers may play an important role in helping us to understand variations in CSR across countries. This in turn has implications for how managers of multinational companies should implement CSR strategies in different cultural contexts. (shrink)

This paper explores the relationship between attitudes to corporate social responsibility (CSR) and the cultural dimensions of business activity identified by Hofstede & Hofstede using a sample of nearly 90,000 stakeholders drawn from 28 countries. We develop five general propositions relating attitudes to CSR to aspects of culture. We show that the propensity of consumers to punish firms for bad behaviour varies in ways that appear to relate closely to the cultural characteristics identified by Hofstede. Furthermore, this variation (...) appears to be understandable in terms of the standard interpretation of the Hofstede dimensions, suggesting that cultural variation in the attitudes of consumers may play an important role in helping us to understand variations in CSR across countries. This in turn has implications for how managers of multinational companies should implement CSR strategies in different cultural contexts. (shrink)

Corporate social responsibility (CSR) is increasingly becoming a popular business concept in developed economies. As typical of other business concepts, it is on its way to globalization through practices and structures of the globalized capitalist world order, typified in Multinational Corporations (MNCs). However, CSR often sits uncomfortably in this capitalist world order, as MNCs are often challenged by the global reach of their supply chains and the possible irresponsible practices inherent along these chains. The possibility of irresponsible practices (...) puts global firms under pressure to protect their brands even if it means assuming responsibilities for the practices of their suppliers. Pressure groups understand this burden on firms and try to take advantage of the situation. This article seeks to challenge the often taken-for-granted-assumption that firms should be accountable for the practices of their suppliers by espousing the moral (and sometimes legal) underpinnings of the concept of responsibility. Except where corporate control and or corporate grouping exist, it identifies the use of power as a critical factor to be considered in allocating responsibility in firm-supplier relationship; and suggests that the more powerful in this relationship has a responsibility to exert some moral influence on the weaker party. The article highlights the use of code of conducts, corporate culture, anti-pressure group campaigns, personnel training and value reorientation as possible sources of wielding positive moral influence along supply chains. (shrink)

The paper examines the issue of corporate social responsibility against the backdrop of its self-regulatory posture. Using the African experience as a case study, the paper observes that the activities of multinationals show very clearly that they are grossly irresponsible despite their professed self-regulation. Instead, the multinationals have created an image of terror due to their deep-rooted involvements in human rights abuses, environmental degradation, tax evasion, bribery, market manipulation, and other forms of unethical practices, notwithstanding their so-called self-regulation. (...) The paper concludes by advocating the establishment of a broad-based United Nations Global Business Regulatory Agency to fully take charge of corporate regulation in the global business terrain. (shrink)

The paper examines the issue of corporate social responsibility (CSR) against the backdrop of its self-regulatory posture. Using the African experience as a case study, the paper observes that the activities of multinationals show very clearly that they are grossly irresponsible despite their professed self-regulation. Instead, the multinationals have created an image of terror due to their deep-rooted involvements in human rights abuses, environmental degradation, tax evasion, bribery, market manipulation, and other forms of unethical practices, notwithstanding their so-called (...) self-regulation. The paper concludes by advocating the establishment of a broad-based United Nations Global Business Regulatory Agency to fully take charge of corporate regulation in the global business terrain. (shrink)

Recent scandals involving executive leadership have significantly contributed to the topic of corporate social responsibility (CSR) becoming one of the most important concerns of the management literature in the twenty-first century. The antithesis of CSR is embodied in executive corruption and malfeasance. Unfortunately such things are all too frequent. We view the degree of centrality of leadership, and the primary power motivation of leaders, as key factors that influence the engagement in corruptive leader behavior and consequent corporate (...) social ir-responsibility (CSIR) in organizations. Shared and self-leadership, on the other hand, we introduce as alternatives to traditional top-down centralized views of leadership that can establish needed checks and balances capable of reducing corruptive tendencies. We offer a conceptual model along with several propositions to help guide future research and practice. (shrink)

This study examines the impact of chief executive officer ability on firms’ corporate social responsibility performance. We find that firms’ CSR performance increases with CEO ability. Specifically, firms with more able CEOs are associated with more socially responsible activities and fewer socially irresponsible activities, and are associated with more stakeholder CSR rather than third-party CSR. We further find that the positive relation between CEO ability and CSR is weakened for CEO who is also the chair of the board (...) and for CEO who is close to retirement; and is weakened when the CSR emphasis exerted by a firm’s external environment is high. Our results are robust after controlling for firm fixed effects and to the use of multiple measures of CSR performance and CEO ability. Overall, our evidence is consistent with our conjecture that more able CEOs have less career concerns so that these CEOs are more willing to undertake long-term investments in socially beneficial activities, leading to better CSR performance. (shrink)

This study examines whether the chief executive officer’s poverty experience has an impact on firms’ corporate social responsibility. We find that firms’ CSR performance increases with CEOs’ poverty experience; specifically, firms with CEOs who experienced early-life poverty are associated with more socially responsible activities and fewer socially irresponsible activities, such as on-the-job consumption, and are more associated with key stakeholder-related rather than community-related CSR. We further find that the positive relationship between the CEO’s poverty experience and CSR strengthens (...) for well-educated or powerful CEOs. Our evidence is consistent with our conjecture that CEOs who experienced early-life poverty have stronger compassion and prosocial psychology. Consequently, these CEOs are more willing to make long-term investments in socially beneficial activities, leading to better CSR performance, which further confirms the altruistic motivation of CSR. (shrink)

This study examines the relation between a firm’s business strategy and its corporate social responsibility performance. Using a comprehensive measure of business strategy based on the Miles and Snow theoretical framework, we find that firms following an innovation-oriented strategy are associated with better CSR performance than those following an efficiency-oriented strategy. Specifically, compared with defenders, prospectors engage in more socially responsible activities, fewer socially irresponsible activities, and perform better in both stakeholder- and third-party-related CSR areas. Taken together, our (...) results suggest that business strategy is an important determinant of CSR performance. Prospectors take advantage of CSR, as their innovation-oriented strategy allows them not only to benefit more from CSR, but also to have more tolerance for the uncertainty, risk, and long time-horizon associated with CSR engagement. (shrink)

The literature acknowledges a distinction between immoral, amoral and moral management. This paper makes a case for the employee (at any level) as a moral agent, even though the paper begins by highlighting a body of evidence which suggests that individual moral agency is sacrificed at work and is compromised in deference to other pressures. This leads to a discussion about the notion of discretion and an examination of a separate, contrary body of literature which indicates that some individuals in (...) corporations may use their discretion to behave in a socially entrepreneurial manner. My underlying assumption is that CSR isn’t solely driven by economics and that it may also be championed as a result of a personal morality, inspired by employees’ own socially oriented personal values. A conceptual framework is put forward and it is suggested that individuals may be categorized as Active or Frustrated Corporate Social Entrepreneurs; Conformists or Apathetics, distinguished by their individualistic or collectivist personal values. In a discussion of the nature of values, this paper highlights how values may act as drivers of our behavior and pays particular attention to the values of the entrepreneur, thereby linking the existing debate on moral agency with the field of corporate social responsibility. (shrink)

This article examines the empirical association between analyst coverage and corporate social responsibility (CSR) by investigating their simultaneous and causal effects, and its joint effects of CSR engagement and analyst coverage on firm risk. We find a positive association between the level and change of CSR engagement and the level and change of analyst coverage after considering simultaneity and causality. Based on the first-difference approach, we further find that the change in analyst following from the previous year affects (...) the change in CSR in the current period, whereas the change in CSR from the previous period does not influence the change in analyst following in the current period. Furthermore, we find that the change in CSR engagement as well as the interaction effect of changes in CSR and analyst coverage reduces the change of firm risk. When we examine the CSR strengths and concerns separately, analyst following does not significantly influence firms’ CSR strength but CSR concern activities decreases significantly as firms have more analyst followings. We further find the mediating role of financial analysts between CSR concerns (but not CSR strengths) and firm risk. We maintain that analysts provide indirect but additional social pressure to the firms to eventually reduce their irresponsible activities. Taken together, we interpret these results to support the stakeholder theory-based conflict-resolution explanation that considers CSR engagement as a vehicle to reduce conflicts of interest between managers and noninvesting stakeholders but not the overinvestment hypothesis that views CSR as a waste of valuable resources at the cost of shareholders. (shrink)

This article provides a review of what we know, what we do not know, and what we need to know about the relationship between industrial clusters and corporate social responsibility in developing countries. In addition to the drivers of and barriers to the adoption of CSR initiatives, this study highlights key lessons learned from empirical studies of CSR initiatives that aimed to improve environmental management and work conditions and reduce poverty in local industrial districts. Academic work in this (...) area remains embryonic, lacking in empirical evidence about the effects of CSR interventions on the profitability on local enterprises, workers, and the environment. Nor do theoretical frameworks offer clear explanations of the institutionalization and effects of CSR in local industrial districts in the developing world. Other key limitations in this research stream include an excessive focus on export-oriented industrial clusters, the risk that CSR becomes a form of economic and cultural imperialism, and the potential for joint-action CSR initiatives in clusters of small and medium-sized enterprises to offer a new form of greenwashing. From this review, the authors develop a theoretical model to explain why CSR has not become institutionalized in many developing country clusters, which in turn suggests that the vast majority of industrial clusters in developing countries are likely to engage in socially irresponsible behavior. (shrink)

Research based on the behavioral theory of the firm (BTOF) argues that firms will actively adopt strategic actions to respond to performance that falls below aspirations, that is performance shortfalls. However, most previous studies have focused on market-related strategic actions, paying less attention to the impact of performance shortfalls on non-market-related strategic actions, especially corporate social responsibility (CSR) and corporate social irresponsibility (CSI). In this study, we propose that firms facing performance shortfalls are likely to (...) reduce CSR levels and increase CSI levels. In addition, we also propose that board characteristics (board size, board age and board tenure) have a significant moderating effect on the above relationship. Empirical analyses based on an unbalanced panel data of China's listed firms from 2010 to 2018 show that our arguments are largely supported. (shrink)

A number of theorists have proposed mechanisms suggesting that corporate social responsibility produces better financial results. Others subscribe to the theory that, realistically, less ethical means are necessary. This article contains an analysis of these perspectives drawing on observations from evolutionary game theory and nature. Based on these analyzes, it is concluded that the financial returns of corporate social responsibility and irresponsibility (CSR and CSI) are equal on average. The explanation is that CSR and CSI (...) are driven to a state of equilibrium, because if one or the other were to offer higher profits, it would attract more players who would compete for the best opportunities until there was no difference in average profit. Existing empirical research generally shows a positive correlation between CSR as measured and financial outcomes. It is argued that what is actually causing that finding is probably not CSR but management skill. More skillful managers, whether actually responsible or irresponsible, are able to obtain both higher profits and greater credit in imperfect measures of CSR. Next it is shown that this theory of equal returns implies greater moral freedom and therefore responsibility for business leaders. It is concluded that this insight can intensify the interest of decent business leaders in vigorously championing CSR. (shrink)

Corporate social irresponsibility continues despite institutional pressures for socially responsible behavior, resulting in disasters like the Kalamazoo River Oil Spill and the Exxon Valdez Oil Spill. We conduct an in-depth abductive analysis of the Kalamazoo River Oil Spill to explain factors that enable corporate forgetting work projects. Specifically, we illustrate how a corporation’s political activities allow it to gain the power to suppress its mnemonic community’s voices, thereby attenuating an irresponsible event’s memory from the minds of (...) its stakeholders, protecting its image, and maintaining legitimacy in the shareholder and state’s eyes. We also highlight how the remembrance and forgetting of an irresponsible incident diverges between stakeholders based on their characteristics, future goals, and aspirations and whether they directly suffered from the disaster. Our research makes notable contributions to forgetting work literature by highlighting the importance of corporate political activities and context on the success of corporate forgetting work projects. (shrink)

The traditional understanding of corporate social responsibility (CSR) has largely been focused on its downstream performance implications, particularly its associations with firms’ customer market metrics such as customer loyalty, customer satisfaction and customer co-creation as well as financial ones such as firm value, return on assets etc. However, given the close relationship between CSR and marketing that literature has identified, it is surprising that the relationship between a focal upstream construct, i.e. the marketing function’s power within a firm (...) and the firm’s propensity toward CSR has not been addressed in the literature. Examining the link between marketing’s power (MP) in a firm’s top management team (TMT) and firm CSR levels, we investigate how this fundamental TMT configuration, i.e. the distribution of marketing power in the TMT, motivates the firm’s social endeavors. Further, we formulate this relationship in a contingency-based model that incorporates the moderating effects of firm size, firm age, service intensity, and resource slack across 1569 firms operating in 63 industries. In addition to their effect on CSR, this study shows how MP in TMT may influence corporate social irresponsibility (CSI) as well as CSR capability after controlling for industry type. The inclusion on these additional dimensions of CSR (CSI and CSR capability) complements our analyses of the effect that MP has on CSR. The research contributes to a deeper understanding of CSR’s fundamental corporate determinants as well as identifies the essential role of the marketing function in firms’ CSR strategy. In this process, it yields useful implications for multiple streams of theory as well as for business practices. (shrink)

Social norms of responsibility are shared beliefs on what constitutes responsible behavior, and they play a significant role in determining CSR. This study analyzes how social norms of responsibility permeate corporate boundaries and influence CSR through political leaders, corporate executives, employees, and the public. Socially irresponsible behaviors of the above populations are used as proxies for local social responsibility norms and related to CSR ratings for firms headquartered in the twenty largest U.S. metro areas. The (...) empirical results show that firms headquartered in cities with more responsible social norms exhibit higher ESG scores even after controlling for various demographic, regional, and economic factors. Social responsibility norms encourage firms to be more responsible but are ineffective in deterring irresponsible corporate behaviors. Corporate and political leaders are the essential channels through which social norms of responsibility influence CSR, highlighting the importance of instituting regulations and setting high ethical standards for political and business leaders. This study also demonstrates that social norms have a significant impact on firms with leaders who are more susceptible to local social norms (i.e., local leaders) than non-local leaders. In addition, this study documents a negative bias for responsible social norms in that they condemn irresponsible behaviors more than reward responsible ones. Collectively, the above findings underline the importance of social norms of responsibility in shaping CSR and provide additional insights into societal motivations for CSR. (shrink)

ABSTRACTThis study examines whether a firm's ownership form has any influence on its social performance. Conventional wisdom suggests that public corporations are more susceptible to corruption and socially irresponsible behavior than privately owned corporations because of the intense short‐term profit maximization pressure from shareholders and the lack of sufficient monitoring mechanisms. This study introduces an alternate perspective in thinking about the relationship between ownership form and corporate social responsibility. This study reasons that public corporations are more likely (...) to become socially responsible because of their greater exposure to external influence and greater dependence on external actors with diverse interests. Using a panel data on the pollution management practices of 118 industrial facilities over a 13‐year period, this study shows that public corporations were indeed subject to greater external pressure to reduce pollution, and the pressure led to consistently stronger environmental performance. (shrink)

Ensuring access to clean water is one of the most important development and health challenges of the twenty-first century. Given the manifold impacts of business activities on water resources, corporate water actions should be of central concern to business ethics researchers. Yet so far we know too little about whether business activities that impact on water resources are noticed or how corporate water actions are valued by a firm’s stakeholders, including by financial markets. In response, we conduct an (...) event study to investigate the shareholder wealth effect of reports of corporate water actions. We explore stock market reactions to water actions by S&P 500 firms from 2005 to 2017, showing that the market reacts positively to reports of responsible water actions and negatively to irresponsible actions. We further explain that these abnormal returns to water actions are associated with a firm’s past performance on ethical issues, arguing that the reputational effects from prior corporate social responsibility and irresponsibility influence market reactions. Our analysis provides evidence that there are diminishing marginal returns to responsible water actions for firms with records of past responsibility and an offsetting effect for those with past irresponsibility. Similarly, we demonstrate an insurance effect that limits punishment for irresponsible water actions for firms with responsible performance records and diminishing negative marginal returns for those already seen to be irresponsible. This study is the first to show that shareholders recognize market value in corporate water actions and are prepared to award or punish firms in stock markets based on their impacts on water. (shrink)

Corporate Social Responsibility is a label covering managerial checks and institutional balances introduced against the background of ethical values. Values are clearly formulated and organizational processes are designed with the inclusion of stakeholders and their voice in mind. In case of the post-communist societies designers of CRS cope with an additional level of complexity. Original sin of market reforms after the political fall of the communist regimes is the corrupt take-over of markets and democracies. Social institutions of (...) capitalist markets and democratic states have been subverted and invaded by the unpurged networks of the post-communist power elites. They privatized the wealth of state enterprises becoming new owners of economic resources and they drifted towards the top functions in state institutions becoming post-communist power brokers. Their long-term monopoly of the media left them in command of the mainstream PR communications long after their absolute political power was gone. Democratic institutions, and the right to free speech are daily challenged by influential image and market competition. They cannot be taken for granted. Some democratic institutions are undermined by subversive networks of the corrupt mafias often formed by ex-functionaries of the communist party and her secret services. Their tacit power is explicitly legitimized by media-clusters of cultural representatives of the communist ex-power elites exploiting leftist bias of media mainstreams. (shrink)

Abstract‘Monkey see, monkey do’ is an old saying referring to imitating another's actions without necessarily understanding the underlying motivations or being concerned about consequences, such as propagating harmful behaviors. This study examines the likelihood of firms imitating and proliferating others’ unethical, irresponsible practices thereby exacerbating harmful effects among even more firms; in doing so, irresponsible contagions can rapidly spread more broadly, negatively affecting even more consumers. Building upon rivalry- and information-based imitation theories, we examine if harmful behaviors of others, in (...) combination with misbehavior of referent firms, influences the likelihood of a firm to engage in irresponsible consumer-related practices. After examining 25,824 firm-year observations over 12 years, our findings suggest that imitation of harmful product-related behavior occurs; with size an important factor related to proliferation of harmful behaviors. Testing the model against a holdout sample finds 94% accuracy. Implications for scholars, managers, and policy makers are explored. (shrink)

Current research has documented how cases of irresponsible corporate behavior generate negative reactions from consumers and other stakeholders. Existing research, however, has not examined empirically whether the characteristics of the victims of corporate malfeasance contribute to shaping individual reactions. This study examines, through four experimental surveys, the role played by the national identity of the people affected on consumers’ intentions to spread negative word of mouth. It is shown that national identity influences individual reactions indirectly; mediated by perceived (...) similarity and sympathy. Consumers perceive foreign victims as different from the self and this reduces the sympathy experienced towards them. Sympathy is an emotion that shapes consumer reactions and regulates WOM. The study identifies two moderating processes of this effect. Individuals who score high on collective narcissism are most likely to be strongly biased against foreign victims. In-group bias is also moderated by the perceived severity of the crisis. When a case is perceived as very serious, perceived similarity plays a less important role in generating sympathy because consumers focus on the perceived suffering of the victims. Hence, in-group bias is stronger in cases perceived as having minor consequences. The paper contributes to the literature on corporate social irresponsibility and offers implications for both scholars and managers. (shrink)

This study investigates the connection between corporate social responsibility (CSR) and corporate reputation among the public using fuzzy set qualitative comparative analysis (fsQCA). To examine complex processes underlying the reactions of this influential stakeholder group, hypotheses are drawn from the category diagnosticity approach. Thereby, a psychological model of perceived (im)morality is transferred to the CSR context. In line with these hypotheses, positive/negative CSR activities influence reputation in the expected directions (H1a, b), while the effects of specific configurations (...) of CSR activities reveal an asymmetry suggesting a negativity bias (H2). Further analyses confirm that positive effects require a consistent positive performance regarding prior reputations (H3a) and the aggregated CSR activities of several previous years (H3b, c). Moreover, the relevant patterns vary between industries (H4). The present study thus contributes to CSR research by investigating a powerful but hitherto understudied stakeholder group through a category diagnosticity lens combined with a configurational approach to analysis. (shrink)

How do we deal with difference personally, interpersonally, nationally? Can we weave a cohesive social fabric in a religiously plural society without suppressing differences? This collection of significant essays suggests that to truly honour differences in matters of faith and religion we must publicly exercise and celebrate them. The secular/sacred, public/private divisions long considered sacred in the West need to be dismantled if Canada (or any nation state) is to develop a genuine mosaic that embraces fundamental differences instead of (...) a melting pot that marginalizes. An ethics of difference starts with a recognition of difference, not as deviance or deficit that threatens but as otherness to connect with, cherish, and celebrate. The book begins with the suggestion that our inability to come to terms with social plurality is not fundamentally the fault of religious differences, and that a public/private split inadequately deals with matters of basic difference. It then explores how encouraging people to live out their respective faiths may open new possibilities for respectful, honourable, and just negotiations of contemporary dilemmas arising out of the multicultural fabric of Canadian life. Towards an Ethics of Community introduces readers to some of the most challenging and divisive dilemmas we face in this increasingly pluralistic, postmodern world — issues such as family and domestic violence, Aboriginal rights, homosexuality and public policy, and female genital mutilation. This is a book truly global in scope and significance. (shrink)

This book takes a critical view on corporate practice, governmental action and the general approach to Corporate Social Responsibility. It draws on experience from the Workplace Innovation movement and argues that, as with motherhood and apple pie, it is hard to oppose CSR, with a community of well-meaning people. It is however necessary to challenge the foundations on which it is based. Many accounts of CSR assume a consistent model of capitalism around the world. It is suggested (...) that capitalism can be given a human face, as companies adopt programmes which go beyond the minimum legal requirements. This builds on traditions of optional corporate philanthropy. However, without changing the underlying working of the company, only cosmetic changes are made. In the author's words: "lipstick is applied to the capitalist pig". It can be a mistake to read too much into "Responsible Management", when the culture of management is designed around irresponsibility. Companies have developed elaborate schemes of outsourcing, in an environment of limited liability. This cannot easily be overcome through gestures. This book seeks to engage readers and to provoke thoughts. It can be angry and polemical, but it points a finger directly at ongoing superficial developments. (shrink)

Past research on recruitment has shown that employer image predicts job seekers’ perceptions of organizational attractiveness. We contribute to this body of work by examining job seekers’ reactions to a market-dominant employer that has suffered from a case of corporate social irresponsibility (CSI). We show that job seekers’ reaction is buffered in the case of dominant employers’ wrongdoing. This effect is stronger for job seekers who are very interested in working in the dominant employers’ industry. Market dominance, (...) however, reduces the negative impact of CSI only under certain circumstances. We find that market dominance provides a buffer against the negative effect of CSI only when (1) CSI is directly relevant to the domain of performance of the organization and (2) job seekers feel very certain about their attitudes toward the organization. In two experiments with participants actively looking for employment at the time of study, we tested a model of moderated mediation examining how market dominance and CSI influence perceived employer ethicality and perceived employer competence. These two variables, in turn, explain how job seekers form perceptions of organizational attractiveness. This is the first study to explore how job seekers react to potential employers that are dominant in a market but have suffered from a CSI incident. The study identifies the boundary conditions that explain why sometimes market-dominant employers can emerge relatively unscathed in the eyes of job seekers following CSI. The research opens important managerial implications concerning the recruitment efforts of organizations that have suffered from CSI. (shrink)

This paper seeks to make a contribution toward a general theory of responsibility and irresponsibility. Such a theory, or framework or model, addresses therelationship between responsibility and irresponsibility. The motive for the effort is that the literature on business ethics, corporate citizenship, and corporate social responsibility combines negative prohibitions with positive requirements and at both individual and organizational levels of action. A prohibition takes the form “do not” expressed in laws and ethics. A requirement takes (...) the form “should” or “ought” expressed in theories of responsibility and stakeholder engagement. Armstrong (1977) points out that actually preventing harm may be socially much more valuable than promoting contribution. (shrink)

This study examines the influence of mood on corporate philanthropic giving. Drawing on group emotions theory and affect-infused decision theory, we advance the argument that firms allocate greater resources to philanthropy when headquarters-based employees are in a more positive affective state. We also describe three boundary conditions in this relationship—executives’ embeddedness in the firm, executives’ latitude to engage in philanthropic giving, and the firm’s track record of corporate social irresponsibility. We test our arguments using a longitudinal (...) dataset of philanthropic giving by U.S. firms. Our study contributes to the literature by shedding light on the role of affect in shaping the decision to allocate resources to corporate philanthropy. (shrink)