Corporate Social Responsibility and Corporate Governance: Analysis Across Industries in Mexico

Literature Review

The existence of an organization significantly depends on stakeholders’ acknowledgement of its legitimacy (Deegan, 2002), and accountability. Corporate social responsibility (CSR) is an important strategy carried out by organizations with the aim to address certain social and environmental issues. It is a concept that has many definitions; it is charged with different meanings for diverse organizations (Crowther & Rayman-Bacchus, 2004), determined by their context of operations and characteristics of business dynamics. CSR has been considered as organizations’ concern for the impact of their efforts on their activities as well as on society (Bowman & Haire, 1976). CSR consists of organizations’ clear communication of their policies and practices that reflect their responsibility towards the achievement of social wellbeing (Matten and Moon, 2008). And, according to Kotler and Lee (2005), corporate social responsibility is a “commitment to improve community well-being through discretionary business practices and contributions of corporate resources.” Therefore, it is a firm’s active use of its resources (financial and non-financial) to proactively engage in socially responsible practices with the purpose of positively contributing to society’s wellbeing.