Business Case for CSR Literature Review (original) (raw)
Related papers
The Business Case for Corporate Sustainability
European Management Journal, 2005
In the last ten years, the notion of a 'business case' for corporate sustainability has increasingly been used by the corporate sector, environmental organizations, consultancies and so on, to seek justification for sustainability strategies within organizations. In this paper, we aim to systemize and assess existing research and tools related to this increasingly popular concept. We present a review of (1) theoretical frameworks, (2) instrumental studies aiming to either prove or disprove a hypothesized causal sequence between corporate social or environmental performance and financial performance, (3) descriptive studies examining manager's actual perceptions and practices, and finally (4) tools. We identify a clearly insufficient understanding of manager's key arguments or business logic for adopting corporate sustainability strategies (how 'business cases' are built, how effective they are and what barriers they face). We attribute this primarily to lack of descriptive research in these areas.
In this review, the primary subject is the 'business case' for corporate social responsibility (CSR). The business case refers to the underlying arguments or rationales supporting or documenting why the business community should accept and advance the CSR 'cause'. The business case is concerned with the primary question: What do the business community and organizations get out of CSR? That is, how do they benefit tangibly from engaging in CSR policies, activities and practices? The business case refers to the bottom-line financial and other reasons for businesses pursuing CSR strategies and policies. In developing this business case, the paper first provides some historical background and perspective. In addition, it provides a brief discussion of the evolving understandings of CSR and some of the long-established, traditional arguments that have been made both for and against the idea of business assuming any responsibility to society beyond profit-seeking and maximizing its own financial wellbeing. Finally, the paper addresses the business case in more detail. The goal is to describe and summarize what the business case means and to review some of the concepts, research and practice that have come to characterize this developing idea.
Managerial perceptions of the business case for corporate social responsibility
2008
Resume: This paper draws on interviews with 12 investor relations directors. These were used to elicit the mental models respondents used when explaining their firms' motivation to engage in Corporate Social Responsibility (CSR). Four dimensions of CSR-induced competitive advantages emerged: risk, efficiency, branding, and new markets. Respondents from firms with lower social performance drew on less differentiated and less balanced cognitive frameworks (focussing on risk and efficiency).
Systematic Review of the Business Case for CSR
International Journal of Economic Practices and …, 2013
The business case for CSR may support the diffusion of CSR practices in the business world, but its verification still remains largely inconclusive. The paper aims at proposing new methodological approaches to the study of the business case by developing an extensive systematic review of previous empirical papers. Sections of papers have been scrutinised in order to detect possible mistakes in methodologies, social performance and firm performance measures. Understanding these aspects enables future research to obtain more reliable findings. The analysis of CSR determinants has allowed to identify factors which can explain the relationship between business and society, while affecting CSR. Findings of this research confirm that there is little evidence of a fully positive link between outcomes of social responsibility initiatives and firm performance. The selection protocol of papers is quite objective, but literature analysis is similar to vote-counting. Moreover, there is inconsistency in methodology and research design in the analysed studies. In order to improve future research on the business case for CSR some paths have been proposed meeting some issues recently stated by scholars. These affect the analysis of how firms can properly internalise stakeholder requests and benefit from it, also favouring society. Previous literature reviews have not extensively considered limitations and recommendations for future research of the analysed papers, as well as the broader interpretation of the business case and CSR determinants , Stakeholder influence capacity and the variability of financial returns to Corporate Social Responsibility, Academy of Management Review, 32 : 794-816. Barnett, M. L. and Salomon, R. M. (2006), Beyond dichotomy: The curvilinear relationship between social responsibility and financial performance,
Journal of Management & Governance, 2015
This paper aims to analyse ''how'' and ''why'' a company engages in CSR and sustainability. The ''how'' concerns the features of the firm's CSR and sustainability approach, defined in terms of a firm's strategy (implemented issues, initiatives and activities) and organization (organizational structures and roles and managerial systems adopted). The ''why'' refers to the key determinants, both internal and external, of CSR and sustainability. Finally, how the firm's CSR and sustainability approach evolves over time and the relation between CSR determinants in various stages of the CSR evolutionary path are also investigated. The research method is based on the longitudinal analysis of a case study concerning a large multinational company operating in the telecommunications industry in Europe. The analysis of the case study shows that sub-cultural differences in the approach to CSR and sustainability may occur across hierarchical levels and functional units. Moreover, embedding CSR and sustainability principles doesn't follow a linear and continuous process, made by sequential stages. Indeed, it can be characterized by an up and down evolutionary path, based on different stages with a changing emphasis given to CSR and sustainability issues. Finally, we find that the firm CSR and sustainability approach is not an autonomous choice, but it is a consequence of the contingent role played by both the external and the internal drivers and by their relative importance during the company's CSR history.
CSR 2.0 – The Corporate Sustainability & Responsibility Agenda
Businesses are capable of implementing responsible behaviours as they pursue their profit-making activities. A thorough literature review suggests that many academic articles have dedicated their energies on organising and evaluating the evidence to establish a link, usually through regression analysis between corporate social responsibility (CSR) or corporate social performance (CSP) and financial performance. Other authors referred to similar concepts as corporate citizenship has evolved following the concepts of stakeholder engagement and business ethics. In the light of these past theoretical underpinnings, this article reports on the many facets of CSR. This contribution puts forward key constructs representing strategic CSR, creating shared value and systematic CSR. It sheds light on the corporate sustainability and responsibility (CSR2.0) notion. This latter perspective suggests that responsible behavioural practices may be strategically re-conceived to confer competitive advantage over rival firms. Therefore, article makes reference to specific examples of some the latest laudable investments that create shared value. It explains how CSR2.0 requires a focus on building adaptive approaches and directing resources towards the perceived demands of diverse stakeholders for the long term sustainability of business. In a pragmatic approach, this contribution indicates that societal demands are not viewed as constraints on the organisation, but more as challenging opportunities which can be leveraged for the benefit of the firm and its stakeholders. The Business Case for Corporate Social Responsibility CSR can help to build reputational benefits; it enhances the firms’ image among external stakeholders and could lead to a favourable climate of trust and cooperation within the company 1. It may lead to create value for both business and society 2 3 4. Several authors maintained that through strategic CSR engagement businesses may achieve a competitive advantage 5 6. Empirical studies have shown that there is a correlation between CSR and financial performance 1 3 7. Yet, it may appear that to date there is no explicit, quantitative translation of socially responsible practices into specific results that affect the profit and loss account8. Nevertheless, many companies are defending the correlation between social practices and financial results. The working assumption revolving around the CSP research is that corporate social and financial performance are universally related3. Strategic CSR increases the financial performance; minimises costs through better operational efficiencies, boosts the employee morale and job satisfaction and reduces the staff turnover, along with other benefits3. CSR can bring a competitive advantage only if there are ongoing communications and dialogue between all stakeholder groups9 10 (including the employees, customers, marketplace and societal groups). The stakeholder relationships are needed to bring external knowledge sources, which may in turn enhance organisational skills and performance. Acquiring new knowledge must be accompanied by mechanisms for dissemination. There is scope in sharing best practices, even with rival firms. It is necessary for responsible businesses to realise that they need to work in tandem with other organisations in order to move the CSR agenda forward3 4. A recent study has indicated that businesses were investing in environmental sustainability, as they minimised their waste by reducing, reusing and recycling resources11. Several others were becoming more conscientious about their environmental responsibilities, particularly in the areas that were in situated in close proximity to their business. They were increasingly protecting the environment as they reduced their pollution through carbon offsetting programmes and the like11. The researcher believes that there is still room for improvement. There are many business practitioners who ought to realise the business case for CSR. Their organisational culture and business ethos could become more attuned to embrace responsible behavioural practices. Corporate sustainability occurs when a company adds a social dimension to its value proposition, making social impact integral to its overall strategy. The rationale behind the corporate responsibility lies in creating value and finding win-win outcomes by seeking out and connecting stakeholders’ varied interests. Creating shared value (CSV) is about embedding sustainability and strategic corporate social responsibility into a brand’s portfolio. As firms reap profits and grow, they can generate virtuous circles of positive multiplier effects11. Conclusion This article provides the foundation of the conceptual theory and empirical enquiry of the discourse surrounding the corporate sustainability and responsibility (CSR2.0) agenda. A thorough literature review reveals that many authors have often investigated the relationship between corporate social responsibility (corporate social performance or corporate citizenship) and financial performance. This contribution maintains that CSR 2.0 initiatives can be re-conceived strategically to confer competitive advantage in the long term. The business case for CSR 2.0 focuses on building adaptive approaches and directing resources towards the perceived demands of stakeholders (Camilleri, 2015). Stakeholder demands are not viewed as constraints on the organisation, but more as challenging opportunities which can be leveraged for the benefit of the firm. This contribution looks at different aspects of CSR2.0, as it makes specific reference to responsible human resources management, environmental sustainability, forging relationships with marketplace stakeholders and strategic philanthropy towards the community. Engagement in these activities will ultimately create shared value for both the business and the society. CSR2.0 unlocks value, as the business and the community become mutually reinforcing. The value creation arguments focus on exploiting opportunities that reconcile differing stakeholder demands. Businesses ought to realise that laudable investments in CSR2.0 can lead to better organisational performance in the long run. This contribution indicates that there are future avenues for further research in this promising area of strategic management. Empirical studies may focus on how socially responsible behaviour, environmental sustainable practices, stakeholder engagement and regulatory interventions may create value for all.
Responsible behaviours are increasingly being embedded into new business models and strategies that are designed to meet environmental, societal and governance deficits. Therefore, the notions of Corporate Sustainability, Social Responsibility and Environmental Management have become very popular among academia as corporations are moving beyond transparency, business ethics and stakeholder engagement. This book provides business students and scholars with a broad analysis on the subject of Corporate Social Responsibility (CSR). It builds on the previous theoretical underpinnings of the CSR agenda, including Corporate Citizenship (Carroll, 1998; Waddock, 2004; Matten and Crane, 2004), Creating Shared Value (Porter and Kramer, 2011; 2006), Stakeholder Engagement (Freeman, 1984) and Business Ethics (Crane and Matten, 2004) as it features the latest Corporate Sustainability and Responsibility (CSR2.0) perspective (Visser, 2010). These recent developments imply that the organisations’ commitment to responsible behaviours may represent a transformation of the corporation into a truly sustainable business that is adding value to the business itself, whilst also adding value to society and the environment. This ‘new’ proposition is an easy term that may appeal to business practitioners. CSR2.0 is linked to improvements in economic performance, operational efficiency, higher quality, innovation and competitiveness. At the same time, it raises awareness on responsible behaviours. Therefore, this promising concept can be considered as strategic in its intent and purposes, as businesses are capable of being socially and environmentally responsible ‘citizens’ whilst pursuing their profit-making activities. Carroll (1979) affirmed that the businesses have economic responsibilities as providing a decent return on investment to owners and shareholders; creating jobs and fair pay for workers; discovering new resources; promoting technological advancement, innovation, and the creation of new products and services along with other objectives. Lately, there is similar discourse in many international fora, conferences, seminars and colloquia about corporate sustainability and responsible behaviours. However, the discussions are usually characterised by the presentation of theories that define the concepts, rather than being practical workshops (which involve the businesses themselves). In this light, this book clearly identifies the business case for CSR. It attempts to trigger active participation in corporate suites. Inevitably, it contends that there are still some challenging opportunities facing businesses, which will have to be addressed in the foreseeable future; including Stakeholder Relations and Collaborations, Government Regulation for CSR Compliance and the role of Strategic CSR in Education and Training. This publication combines theory and practice with case studies. Part I introduces the readers to the CSR Agenda. Chapter 1 provides a broad overview of the CSR terminology and its emerging constructs. It presents the business case for CSR. Chapter 2 reports on several international policies and regulatory instruments on the subject of environmental, social and governance disclosures of large organisations. Chapter 3 suggests that there is a rationale to maintain ongoing communications with stakeholders through integrated marketing communications including digital media and traditional channels. Chapter 4 sheds light on socially reponsible and sustainable investments that are being offered in the financial services market. Chapter 5 discusses about the importance of stakeholder engagement with responsible suppliers in the value chain. In Part II; this book contains five detailed case studies on a wide array of corporate sustainable and responsible initiatives that have been taken on board by global corporations in different contexts.