Consumer misperception of eco-labels,green market structure and welfare

Eco-labels are essential for informing consumers about products’ environmental characteristics. However, the many different labels consumers encounter can be confusing, which makes assessing environmental quality associated with each label difficult. How does consumer misperception of competing eco-labels affect market structure and welfare? This article provides theoretical insight into this issue by using a double-differentiation model in which three products compete: an unlabeled product and two distinctly eco-labeled products, one with a medium and one with a high level of environmental quality. The study investigates the effects of consumers’ imperfect information when they perceive all eco-labels as a sign of the same high environmental quality and consider each label as a unique product. This misperception can weaken the firm that provides the greenest product, though paradoxically this situation is not always detrimental to social welfare. However, depending on the certifying organizations, consumer misperception can induce firms to use a greenwashing strategy and encourage nongovernmental organizations and regulators to introduce less stringent standards.     

The Organizational Implementation of Corporate Citizenship: An Assessment Tool and its Application at UN Global Compact Participants

The corporate citizenship (CC) concept introduced by Dirk Matten and Andrew Crane has been well received. To this date, however, empirical studies based on this concept are lacking. In this article, we flesh out and operationalize the CC concept and develop an assessment tool for CC. Our tool focuses on the organizational level and assesses the embeddedness of CC in organizational structures and procedures. To illustrate the applicability of the tool, we assess five Swiss companies (ABB, Credit Suisse, Nestlé, Novartis, and UBS). These five companies are participants of the UN Global Compact (UNGC), currently the largest collaborative strategic policy initiative for business in the world (www.unglobalcompact.org). This study makes four main contributions: (1) it enriches and operationalizes Matten and Crane’s CC definition to build a concept of CC that can be operationalized, (2) it develops an analytical tool to assess the organizational embeddedness of CC, (3) it generates empirical insights into how five multinational corporations have approached CC, and (4) it presents assessment results that provide indications how global governance initiatives like the UNGC can support the implementation of CC.     

What do respondents mean when they report to be “citizens of the world”? Using probing questions to elucidate international differences in cosmopolitanism

The measurement of cosmopolitanism, i.e. the feeling of being a citizen of the world and the corresponding openness towards other cultures and peoples, has proved to be challenging and several scholars have questioned its validity. In this paper, we use web probing, i.e. implementing probing techniques of cognitive interviewing in web surveys, to elucidate the meaning of a frequently used direct measure of cosmopolitanism that asks respondents to what extent they feel they are “a citizen of the world”. As a single-item measure, it cannot be analyzed by statistical approaches such as confirmatory factor analysis. We compare results from Spain, Denmark, Hungary, Germany, Canada, and the U.S. Though the majority of the respondents show an understanding of the item which corresponds to the intention of the researchers, a large part of them does not. In addition, some country differences in the open answers make sense but other differences between countries are hard to explain. We conclude that asking people to what extent they feel they are “a citizen of the world” does not capture well the concept of cosmopolitanism as used in the literature.     

Organizing Corporate Social Responsibility in Small and Large Firms: Size Matters

Based on the findings of a qualitative empirical study of corporate social responsibility (CSR) in Swiss MNCs and SMEs, we suggest that smaller firms are not necessarily less advanced in organizing CSR than large firms. Results according to theoretically derived assessment frameworks illustrate the actual implementation status of CSR in organizational practices. We propose that small firms possess several organizational characteristics that are favorable for promoting the internal implementation of CSR-related practices in core business functions, but constrain external communication and reporting about CSR. In contrast, large firms possess several characteristics that are favorable for promoting external communication and reporting about CSR, but at the same time constrain internal implementation. We sketch a theoretical explanation of these differences in organizing CSR in MNCs and SMEs based on the relationship between firm size and relative organizational costs.