Reconciling Corporate Citizenship and Competitive Strategy: Insights from Economic Theory

Neoclassical and Austrian/evolutionary economic paradigms have different implications for integrating corporate social responsibility (corporate citizenship) and competitive strategy. Porter’s “Five Forces” model implicitly rests on neoclassical theory of the firm and is not easily reconciled with corporate social responsibility. Resource-based models of competitive strategy do not explicitly embrace a particular economic paradigm, but to the extent their conceptualization rests on neoclassical assumptions such as imperfect factor markets and profits as rents, these models also imply a trade-off between competitive advantage and corporate social responsibility. Differences in Austrian/evolutionary economic model’s assumptions about equilibrium, profits, and other economic concepts allow this paradigm to embrace alternative views of strategy such as the activities or dynamic capabilities views. These alternative views of strategy focus on learning and adaptation; they align more easily with corporate social responsibility. In practice this alignment comes about because social engagement facilitates the learning and adaptation that are a source of competitive advantage. Among the many business arguments for CSR such as improved employee morale/productivity or brand differentiation, this view prioritizes innovation.     

Institutional Impediments to Voluntary Ethics Measurement Systems

In this paper, we argue that calls for widespread implementation of ethics measurement systems would be better informed by institutional economic analysis. Specifically, we assert that proponents of such systems must first recognize and understand the institutions that potentially impede such efforts. We identify two potential institutional impediments to measuring ethics and social responsibility. First, we suggest that neoclassical economics, supported by traditional business education and legal precedent, serves to reinforce the notion that shareholders are the primary corporate constituency group. Such an emphasis on the needs of shareholders severely hinders implementation of measurement systems that address the needs of multiple stakeholder groups. Second, we argue that the threat of litigation may constrain corporate managers from measuring and considering ethics and corporate social responsibility matters. In particular, managers may be reluctant to quantify various ethical concerns if the resulting measurements could be used as evidence against the corporation in a lawsuit.     

Making the Shift: Moving from "Ethics Pays" to an Inter-Systems Model of Business

For several decades, business has operated according to the tenets of neoclassical economic theory, where the primary obligation of corporations is to maximize profit for shareholders. However, the larger social mandate for business has changed, represented by the rise of language such as "sustainable development", "corporate social responsibility" (CSR) and "stakeholder groups." Nevertheless, the theoretical shift implied by the use of such language has not occurred. Issues of sustainable development and CSR continue to be justified in the terms of neoclassical economic theory through the rationalization of "doing well by doing good".Within this economic paradigm, CSR cannot move beyond enlightened self-interest (acting in socially responsible ways in order to further one's own ends) because all behavior must be justified economically. This implies that corporate socially responsible behavior will simply cease when it becomes uneconomic, regardless of the impact on interrelated systems which in turn will re-impact the business realm.Faced with bitter realities arising from complex interactions among social, political, cultural, eco-nomic and natural environments, we may better comprehend and negotiate these problems by moving out of a neoclassical economic justification of the stakeholder model of the corporation to an inter-systems model, shifting from a narrow comprehension of a single economic independent system analyzed apart from its larger context to a fuller understanding of business as one of a number of interrelated systems.Operational differences between the old and new mandates are described, and two ways to practically shift towards the new mandate are identified as a modified version of scenario planning and the introduction of the voice of the critic.     

企业社会责任的战略选择与民营企业的可持续发展

本文介绍了一种在国际市场上正逐渐被认可的标准体系———SA8000,即企业社会责任认证体系,对比分析了我国国有企业、三资企业和民营企业履行企业社会责任的现状差别及其原因。在对企业社会责任战略形式进行了分类之后,指出影响企业社会责任战略选择的因素和可能的后果,提出了企业社会责任战略变化的五阶段模型。认为民营企业应该把企业社会责任看成是企业可持续发展的机会和动力,选择企业社会责任战略才是其可持续发展的必要条件和保证。     

Corporate Governance and Neoclassical Economics

Abstract

Although the term “corporate governance” is relatively new in the economist’s lexicon, the issues with which it is concerned are as old as the profession itself. In this article, first I try to illustrate this, and then I trace the development of the literature, including discussions of the so-called managerial discretion literature and the principal–agent literature. Following a discussion of asset bubbles, I illustrate the tension between concerns about corporate governance and neoclassical economics by examining the literature on managerial compensation and mergers. This literature reveals a wide gap between traditional neoclassical economics and more recent developments in behavioral economics.     

The Freedom–Responsibility Nexus in Management Philosophy and Business Ethics

This article pursues the question whether and inasmuch theories of corporate responsibility are dependent on conceptions of managerial freedom. I argue that neglect of the idea of freedom in economic theory has led to an inadequate conceptualization of the ethical responsibilities of corporations within management theory. In a critical review of the history of economic ideas, I investigate why and how the idea of freedom was gradually removed from the canon of economics. This reconstruction aims at a deconstruction of certain axioms of neoclassical economics that hamper contemporary efforts in integrating ethics firmly into management education. I intend to show by these deconstructive endeavors that a constructive use of the idea of responsible freedom could correct and complement the current quantitative focus in business theory through qualitative orientations. I argue that with the help of qualitative success criteria, the strategic integration of the tenets of both business ethics and Corporate Social Responsibility into business practice can be advanced by further research.     

What Corporate Social Responsibility Activities are Valued by the Market?

Corporate management is torn between either focusing solely on the interests of stockholders (the neo-classical view) or taking into account the interests of a wide spectrum of stakeholders (the stakeholder theory view). Of course, there need be no conflict where taking the wider view is also consistent with maximising stockholder wealth. In this paper, we examine the extent to which a conflict actually exists by examining the relationship between a company’s positive (strengths) and negative (concerns) corporate social responsibility (CSR) activities and equity performance. In general, we find little evidence to suggest that managers taking a wider stakeholder perspective will jeopardise the interest of its stockholders. However, our findings do suggest that the market is not only influenced by the independent CSR activities, but also the totality of these activities and that the facets that they value do vary over time. It seems that␣most recently, the market has valued most firms that satisfied minimum requirements in the areas of diversity and environmental protection but were most proactive in the area of employee-relations. Ron Bird is an Emeritus Professor in the School of Finance and Economics at the University of Technology, Sydney. His research interests focus on market implications of corporate social responsibility and also dysfunctionality within capital markets. He received his Master's degree in economics at Monash University in 1971. Anthony D. Hall is currently the Head of the School of Finance and Economics and Director of the Quantitative FinanceResearch Centre at the University of Technology, Sydney. His research interests cover all aspects of financial econometrics. He was awarded a PhD in econometrics from the London School of Economics in `976.Francesco Momente is Professor of Corporate Finance at the Bocconi University, Milan (Italy). His research intersts focus on the market valuation of corporate social responsibility and the value relevance of accounting information.He received his PhD in General Management at Ca' Foscari University, Venice (Italy) in 1998. Francesco Reggiani is Professor of Corporate Finance at the Bocconi University, Milan (Italy). His research interests focuson the market valuation of corporate social responsibility and corporate governance. He received his PhD in GeneralManagement at Bocconi University in 2001.     

Which Dimension of Corporate Social Responsibility is a Value Driver in the Oil and Gas Industry?

The oil and gas (O&G) industry suffers from a negative perception of poor sustainability. O&G companies are therefore engaged in several socially sustainable activities related to community development and environmental protection. This article determines whether the social, environmental, and economic dimensions of corporate social responsibility (CSR) are equally value‐additive to O&G companies. We measure the company‐specific level of CSR activities from the information provided in the annual financial reports of O&G companies and determine the effects of CSR dimensions on firm value. We find that CSR enhances firm value of O&G companies. While social activities such as employee well‐being and community development are key value‐drivers, environmental and economic sustainable activities have an insignificant impact on the market value of O&G companies. Copyright © 2018 ASAC. Published by John Wiley & Sons, Ltd     

企业社会责任与企业财务绩效关联性分析——基于浙江纺织企业的调查数据

企业社会责任与企业财务绩效的关联性决定企业的社会责任态度和行为。通过对浙江纺织行业样本企业数据的计量分析发现,前期企业财务绩效和后期企业的社会责任状况显著正相关;而前期企业社会责任和后期企业财务绩效之间、同期企业社会责任和企业财务绩效之间呈负相关趋势,但统计不显著。出现这种结果的原因可能在于当前中国社会责任市场缺乏,企业社会责任行为的推动力是行政力量而非市场力量,企业社会责任不能顺利转化或提升企业绩效。构建社会责任市场以实现企业和社会的双赢,将有效改善中国企业社会责任状况并促使持久的企业社会责任行为。     

现代企业管理五大核心思想

现代企业面临国内和国际两个市场的竞争挑战,为适应信息技术的发展和管理现代化的要求,现代企业应该具有企业环境管理思想、企业社会责任管理思想、供应链管理思想、移动管理思想、精细化管理思想等五大管理核心思想。     

环境意识与企业形象塑造

可持续发展的思想和社会市场营销观念已成潮流。为适应市场需求的变化和环境管理的要求,寻 求市场机会和避免环境威胁,必然要求企业树立环境意识,履行应尽的社会责任,并融入、体现在企业 形象塑造中。在企业识别系统中贯穿“环境形象”设计是企业形象塑造的关键。     

企业社会责任信息披露与股票价格关系研究——沪市民营企业的经验证据

文章以2009年沪市A股222家民营上市公司为研究样本实证检验了民营企业社会责任信息披露与股票价格的关系,结果表明,民营企业社会责任信息披露与股票价格负相关。结合企业社会责任实践及其信息披露现状、投资者基于企业社会责任的投资理念以及资本市场有效性,从作用机制视角分析了形成民营企业社会责任信息披露与股票价格关系的深层原因,并由此就改进企业社会责任及信息披露实践和促进资本市场健康发展为上市民营企业、资本市场投资者和监管者带来启示。     

The market valuation of ethical assets in Spain: an application of the hedonic pricing method

The aim of this paper is to calculate the market valuation of non‐financial characteristics, namely, the social responsibility criteria (social, ethical and environmental) included in the Spanish Socially Responsible Investment Funds. The hedonic price method is applied for this purpose. This method relates the price of Socially Responsible Investment Funds with both financial and social responsibility characteristics. Because of the large number of social responsibility characteristics included in these funds, prior to application of the hedonic price method, the principal components factor analysis technique is used. The data are taken from the prospectus for each fund and from the data provided by the National Securities Market Commission. Results indicate that the Spanish market is sensitive to the social responsibility practices of companies. In particular, the market value practices related to environmental sustainability, the enforcement of labour rights, sustainable production and consumption and non‐abusive market practices.     

The effects of corporate social responsibility and price on consumer responses

This experiment examined the influence of corporate social responsibility and price on consumer responses. Scenarios were created to manipulate corporate social responsibility and price across two domains (environment and philanthropy). Results from a national sample of adults indicate that corporate social responsibility in both domains had a positive impact on evaluation of the company and purchase intent. Furthermore, in the environmental domain corporate social responsibility affected purchase intent more strongly than price did.     

区域企业社会责任：内涵、实现机制与作用机理

区域企业社会责任建设与区域竞争力的保持和提升密切相关,区域内的政策环境、企业社会责任和社会组织三个方面的相互作用将综合形成区域竞争优势,因此研究区域企业社会责任对于区域经济、社会和环境协调发展具有十分重要的意义。基于现有文献成果,运用系统分析的思路和方法,探讨区域企业社会责任内涵,剖析区域企业社会责任实现机制的基本要素、系统结构和功能,以及实现机制的作用机理,以此构建区域企业社会责任概念模型。     

基于企业社会责任理论的危机管理策略研究

面对日益复杂的市场竞争态势,有效的危机管理对于企业的生存和发展至关重要。实践与研究表明,企业社会责任是有效危机管理的核心。本文从企业社会责任的理论角度出发,探讨企业社会责任和危机管理之间的关系,并结合企业社会责任管理和危机管理,给出基于社会责任的危机管理策略。     

The moderating role of board monitoring power in the relationship between environmental conditions and corporate social responsibility

Is the relationship between environmental munificence, dynamism, and corporate social responsibility contingent on board monitoring power? This is the research question examined in this study of an international sample of 956 listed firms from 2006 to 2014. After applying several regression models for panel data based on Tobit and generalized method of moments' (GMM) estimation, this paper supports the assertion that in munificent and dynamic environments, managers show a lower commitment to social and environmental issues. Proactive promotion of social and environmental concerns only occurs in firms with efficient internal corporate governance mechanisms, resulting in a moderating effect of board monitoring power—board independence and non‐duality of CEO—on the association between environmental conditions and corporate social responsibility. Theoretically, this moderating effect triggers managers to increase their socially responsible performance in munificent and dynamic environments because: (a) these boards reinforce the orientation of a firm towards the meeting of stakeholders' expectations; and (b) managers aim to protect themselves from the greater supervision and control exerted by the board in order to maintain their decision‐making freedom in environments of superior growth, resources, market uncertainty, and instability.     

How Does Corporate Social Responsibility Affect Corporate Continuous Innovation?

From the perspective of sustainable development, this paper analyzes the impact of corporate social responsibility (CSR) on the corporate continuous innovation based on the theory of innovation economics and the demand for innovationdriven development, and then conducts a series of empirical tests based on a sample of Chinese A-shared listed companies from 2008 to 2016. The results show that better CSR performance is conducive to the continuous innovation, and this positive relationship is more pronounced for firms with voluntary accounting information disclosure, for firms of non-high-technology industries, and when policy uncertainty is high. This paper not only enriches the literature on CSR but also provides theoretical references for the innovation practice of enterprises under the innovation-driven strategy.     

How does the theory of consumption values contribute to place identity and sustainable consumption?

The importance of consumers’ role in sustainable consumption is reflected in the vision of the Sustainable Development Education Panel: To educate consumers to make informed consumption decisions, to take responsibility for their actions and to realize the impact of consumption decisions on future generations. However, educating and informing consumers alone is unlikely to change deeply entrenched unsustainable consumption behaviour. A multi‐faceted approach is required – enforcing sustainable development initiatives through legislation, promoting corporate social responsibility programs on the part of business, and (most importantly), supporting communities that engage in sustainable consumption. This study examines the proposition that individuals who identify with their community (i.e. the residential suburb or a locality where identity is understood geographically) are more likely to engage in sustainable consumption. Specifically, it examines how consumption value (i.e. the perceived value of living in a particular residential suburb) contributes to place identity and to environmental attitudes and sustainable consumption behaviour. Structural equation modelling is used to verify the conceptual model using data from a telephone survey of 561 residents from two inner city suburbs in Auckland, New Zealand. The results support the proposition that environmental attitude and sustainable consumption behaviour is enhanced by consumption values through place identity. Residents who enjoy living in their community, value a clean and healthy environment and believe their suburbs are unique tend to develop a stronger identity with their residential suburb, and are more positive towards sustainable consumption. The results have important implications for social marketers, property marketers and city councils who strive to encourage sustainable consumption among its citizens.