Grand Societal Challenges and Responsible Innovation

Grand societal challenges (GSCs) represent complex, multi-level, multi-dimensional problems that require concerted efforts by various actors – public, private, and non-profit – to be successfully addressed. Businesses – alone or in conjunction with governmental and non-profit organizations – are relevant actors in this regard, as they represent a source of innovation. Responsible innovation (RI) is a framework that allows for the governance and evaluation of innovations with regard to their potential harmful consequences and positive contributions to societal challenges. Moreover, it stipulates that this evaluation process should be facilitated by appropriate governance structures at various levels. The aim of this article is to expand theorizing on GSCs and RI and to encourage research that explores their links. We outline pertinent characteristics of GSCs that make current conceptualizations of corporate social responsibility and social innovation limited in addressing GSCs. We explicate the reflexive and participative capacities of RI governance as a complementary and promising way forward. Finally, we introduce the contributions to this Special Issue as illustrations of relevant theoretical and empirical groundwork around GSCs and RI, and outline the agenda for future research.     

Investors' carbon risk exposure and their potential for shareholder engagement

This article examines the exposure to and management of carbon risks of different investor types. Considering the dual role as portfolio manager and partial owner, we analyze carbon risk for investors both in terms of exposure to portfolio values and in terms of responsibility as shareholder of carbon-intensive firms. We show that among various investor types, the preference for holding carbon-intensive stocks differs substantially, even when considering traditional investment decision parameters. In particular, it is governments whose portfolio values are most threatened by a carbon risk exposure of 49%, but at the same time, they prefer larger ownership shares in polluting firms. In contrast, individual investors, investment advisors, and mutual funds avoid holding stakes in these firms, while revealing only a moderate exposure of their assets to carbon risk. In view of the Paris Agreement, which includes the consistent steering of financial flows towards a low carbon transformation of the economy, our study provides policymakers with important implications regarding the coverage and effects of respective regulations. By identifying the ownership structures of carbon-intensive firms and respective owners' portfolio compositions, we also offer implications for further research on portfolio decarbonization and shareholders' influence of corporate carbon management.     

Das Zusammenspiel von gesellschaftlicher Umwelt- und Selbstbeobachtung in der Medienberichterstattung

Mass media communication makes societal changes visible and opens the platform for discussion and public debate. Observation of societal changes and public debate are intrinsically linked. Using the example of media coverage on war and questions of defense and security policies, we researched the relationship between societal changes and public debate in a longitudinal study. We performed a content analysis of the daily newspapers FAZ and Süddeutsche Zeitung for the time period of 1989?C2000. The results showed interesting frame relationships between the coverage of single wars and the coverage of defense policies. Specific aspects of war coverage lead to more coverage of security and defense policy issues, and the framing of the one is interrelated to the framing of the other in complex ways.     

A Model for the Development of Small High-Technology Businesses Based on Case Studies from an Incubator

Alf Scherer and D. W. McDonald examine several emerging companies that are currently being assisted by an incubator for small, technology-based businesses. The case studies illustrate how the short- and long-term responses to new technical and market opportunities need to be clearly separated and prioritized. A common failing observed is the underestimation of the time and resources required to successfully commercialize the first product before moving on to the development of second-generation products. A multistep process model of business and product development was found to be a useful tool in diagnosing the status of the start-up companies, as well as identifying future decision points and alternative courses of action.     

The New Political Role of Business in a Globalized World: A Review of a New Perspective on CSR and its Implications for the Firm,Governance, and Democracy

Scholars in management and economics widely share the assumption that business firms focus on profits only, while it is the task of the state system to provide public goods. In this view business firms are conceived of as economic actors, and governments and their state agencies are considered the only political actors. We suggest that, under the conditions of globalization, the strict division of labour between private business and nation‐state governance does not hold any more. Many business firms have started to assume social and political responsibilities that go beyond legal requirements and fill the regulatory vacuum in global governance. Our review of the literature shows that there are a growing number of publications from various disciplines that propose a politicized concept of corporate social responsibility. We consider the implications of this new perspective for theorizing about the business firm, governance, and democracy.     

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.     

Momentum and macroeconomic state variables

We find strong evidence that momentum across asset classes is driven by macroeconomic state variables. By reacting to changes in the macroeconomic environment, the strategy performs particularly well in times of economic distress. This result is interesting for practitioners and academics alike the success of an investment strategy that simultaneously looks at relative momentum across currencies, bonds, real estate, commodities, and equities can be interpreted as a payoff for rational investors hedging against predictable changes in the investment opportunity set. Our results allow us to establish a link between momentum and more sophisticated predictive regressions.     

Thomas Schierl, Deutsche Sporthochschule K?ln

Ohne Zusammenfassung