Abstract
This article explains the three related conceptions of corporate social responsibility (CSR), corporate social irresponsibility (CSiR), and corporate citizenship. The three conceptions involve different approaches for answering the overarching question of the appropriate relationship between “business and society”. The article lays out the basics of the three conceptions; and contrasts economic, ethical, and strategic perspectives on these three conceptions. The article connects the three conceptions to corporate social performance (CSP), corporate governance, and stakeholder theory. The author provides the reader with a guide to the extant literature in a way that will facilitate further exploration into key issues. The author proposes some recommendations and solutions for addressing key problems in the field; and suggests future research directions. The article emphasizes key contributions to the development of the field. Work of important authors such as A. B. Carroll, Milton Friedman, Michael E. Porter, and Donna J. Wood among others receives attention.
TopIntroduction
This article explains three related conceptions: Corporate social responsibility (CSR), corporate social irresponsibility (CSiR), and corporate citizenship (CC). The traditional word “corporate” is not restrictive to large and publicly traded corporations. “Corporate” can have the broader meaning of all “business,” including small and medium sized enterprises and B (i.e., benefit) corporations. The three conceptions involve significantly different approaches for answering the overarching question of the appropriate relationship between “business and society.” A prominent journal, Business & Society, founded in 1960 and sponsored in recent decades by the International Association for Business and Society, reflects this field title. The relationship sometimes has the labels “businesses and societies” (pluralizing the term) or “social issues in management.” The latter is the name of a division of the Academy of Management (founded in 1936). These three labels are essentially synonymous.
The emphasis in each conception is on defining legal and ethical responsibilities of business enterprises and business executives toward society and environment. The “responsibility” approach emphasizes a broad and multidimensional understanding of how businesses can contribute positively to societies. This approach can be contrasted with a narrowly economic conception of profit that disregards negative externalities of business decisions. The “irresponsibility” approach emphasizes strict compliance with legal and ethical standards for conducting business. It distinguishes between “harm” and “altruism” to emphasize that reducing harm caused by businesses is considerably more important empirically than inducing those businesses to practice altruism. The “citizenship” approach invokes “a political metaphor” emphasizing voluntary choices of businesses and executives as distinct from externally imposed responsibilities.
The article has four objectives. One objective is to lay out the basics of the three conceptions responsibility, irresponsibility, and citizenship, as developed to date in extant literature. A second aim is to contrast economic, ethical, and strategic perspectives bearing on these three conceptions. A third aim is to connect the three conceptions to corporate social performance (CSP), corporate governance, and the stakeholder theory of the firm. A final objective is to propose solutions, recommendations, and future research directions for addressing key problems in the field.
Research Methods
This article uses two research methods. The first and dominant method is a literature review. This review has three key dimensions. The review provides a summary of published work on the set of three related topics of responsibility, irresponsibility, and citizenship. The reviewer provides a logical structuring of that work. The review includes a critique of the strengths and weaknesses of the extant literature. The critique clears a path for proposed solutions, recommendations, future research directions. This review is not systematic in the sense of identifying and discussing every published work. The review seeks to provide the reader with a guide to the extant literature in a way that will facilitate further exploration into key issues. The reader can begin with the reference and additional reading items the author selected to reflect the range of those key issues. The secondary method is use of selected cases to illustrate instances and applications.
Limitations of the Study
There are three basic limitations. First, the works and cases reflect the views of the author. The literature review is explicitly selective. Second, the review includes some empirical studies. However the review of empirical work is selective rather than a systematic survey. The survey is not a meta-analytical study of findings. The literature review focuses on conceptual and theoretical work. Third, the linkage of responsibility, irresponsibility, and citizenship to other topics is quite limited. The focus in linkage is on performance, governance, and stakeholder concepts.
Key Terms in this Chapter
Economic Responsibility: The condition that businesses cannot practice extralegal responsibilities if they are losing money. Economic responsibility is also the expectation that business profits are a resultant of positive economic performance in the form of goods and services for consumers, and jobs and compensation for employees.
Environmental Responsibility: The duty or obligation of a business or a business executive to promote environmental sustainability.
Corporate Social Irresponsibility (CSiR): The theory that violation of legal or ethical standards by a business is irresponsible misconduct, typically resulting in illegitimate and avoidable harm to others for business profit.
Legal Responsibility: The duty or obligation of a business or a business executive to comply with criminal and civil laws and public policies.
Triple Bottom Line Performance (TBL or 3BL): A framework within which organizations attempt to maximize jointly three bottom lines, which are typically characterized as people (social welfare), planet (environmental sustainability), and profits (business performance).
Corporate Citizenship (CC): A political metaphor in which the corporation has constitutionally an artificial citizenship which can be interpreted either as liberty to pursue strategic philanthropy and lobbying of governments in place of external requirements and expectations or as an equivalent to corporate social responsibility in different words.
Philanthropic Responsibility: An expectation that profitable businesses should make voluntary charitable contributions in support of home country communities in which they operate.
Ethical Responsibility: The duty or obligation of a business or a business executive to comply with ethical standards and expectations.