An Expanding Conception of Social Responsibility?
Of Sustainability Fields and Changing Corporate Perceptions
Alvise Favotto, University of Glasgow
Kelly Kollman, University of Glasgow
Paper’s Central Question / Argument
• Question:
– To what extent are transnational corporations engaging with global
CSR norms and changing how they define and fulfil their social
obligations?
• Methods:
– A content analysis of management statements in CSR reports, 50 from
the US and 50 from Western Europe, over a 20 year period.
• Findings:
– TNCs have expanded how they define their social responsibilities and
are changing accountability practices.
– Moved from a liability to a social connection model of responsibility
– Engagement is mediated by home country and by issue area
Private CSR Authority and Governance
• Why has private governance emerged and become more prominent?
– Governance gaps opened up by economic globalization (Cutler, Haufler
and Porter, 1999; Hall and Bierstekker 2002).
– NGO targeting and shaming of globalized TNCs (Keck and Sikkink,
1998)
– Rise of neo-liberal norms underpins legitimacy of voluntary codes and
market mechanisms (Bernstein 2002)
• How have global CSR rule-makers gained authority?
– Private governance schemes draw on different types of authority to
gain legitimacy among market actors (Cutler et al 1999; Avant et al
2010)
– Moral, market, expert and capacity authority
Rise of Organizational Field for Sustainability
• Rise of sustainability organizational field:
– CSR standards bodies have increased authority by adopting common norms, structures
and practices to gain capacity and expert authority (Dingwerth and Pattberg 2009).
– Focus on procedures that are trusted by business actors
– Core norms and practices: sustainable development; transparency; multi-stakeholder
decision-making; auditing; setting targets; reporting.
•
Implementation of CSR norms and practices is less well-understood.
– We have a poor understanding of what TNCs will take responsibility for, on what basis,
or to whom / how they hold themselves accountable.
• Uncovering how firms define their responsibility practices complements
CSR code effectiveness literature (Prakash and Potoski 2006 ;
Gulbrandson 2004; Bernhagen and Mitchell 2010).
Methods and Data
• Content analysis of the management statements published in CSR reports
of 100 TNCs (50 US and 50 German) at 3 points in time (1995-99; 2005;
2012-13)
– Firms are drawn from Compustat Database
– Two sub-samples are roughly matched in terms of firm size and mix of
sectors
– Time periods represent formation of sustainability field.
– German / US comparison examines reception two different CSR
traditions
• A self-generated coding frame: motivation; global CSR codes mentioned;
stakeholders mentioned; CSR areas mentioned.
• Complement quantitative approach to TNC norm reception and practice
with qualitative textual analysis
CSR Reporting by German and US Firms over Time
100
90
80
70
60
GERMANY
50
USA
40
AGGREGATE
30
20
10
0
1995-99
2005-06
2012-13
% OF CSR REPORTS % OF CSR REPORTS % OF CSR REPORTS
Period
CSR areas
mentioned
1995-99
2005-06
2012-13
Corruption
0.00
10.91
15.71
Environment
95.24
76.36
85.71
Giving/
community
28.57
69.09
62.86
Human rights
0.00
9.09
24.29
Labour/
Employees
47.62
69.09
70.00
Remuneration
0.00
1.82
5.71
% OF CSR
REPORTS
1995-99
% OF CSR
REPORTS
2005-06
% OF CSR
REPORTS
2012-13
42.86
34.55
37.14
42.86
74.55
37.14
Customers
76.19
65.45
62.86
Employees
61.90
83.64
68.57
IOs
14.29
21.82
38.57
NGOs
Political
regulators
Shareholders
4.76
25.45
15.71
38.10
27.27
25.71
23.81
47.27
22.86
Suppliers
14.29
16.36
24.29
Trade Unions
0.00
7.27
1.43
Period
Business
partners
Community
Stakeholder
mentioned
% OF CSR
REPORTS
% OF CSR
REPORTS
% OF CSR
REPORTS
1995-99
2005-06
2012-13
Continuous
improvement
9.52
9.09
8.57
Materiality
4.76
3.64
22.86
Stakeholder
dialogue
4.76
29.09
24.29
Sustainability
57.14
69.09
78.57
Transparency
4.76
32.73
30.00
% OF CSR
REPORTS
1995-99
% OF CSR
REPORTS
2005-06
% OF CSR
REPORTS
2012-13
GRI
0.00
10.91
12.86
ISO 14001
14.29
3.64
1.43
SA 8000
UN Global
Compact
UN Guiding
Principles
0.00
0.00
0.00
0.00
3.64
34.29
0.00
3.64
4.29
Period
Global CSR norms
Period
Code participation
% OF CSR
REPORTS
Country
% OF CSR
REPORTS
% OF CSR
REPORTS
% OF CSR
REPORTS
Germany
Period
% OF CSR
REPORTS
% OF CSR
REPORTS
USA
1995-99
2005-06
2012-13
1995-99
2005-06
2012-13
0.00
23.08
21.88
0.00
0.00
10.53
100.00
84.62
87.50
90.00
68.97
84.21
0.00
50.00
34.38
60.00
86.21
86.84
0.00
11.54
37.50
0.00
6.90
13.16
Labour/
Employees
36.36
80.77
78.13
60.00
58.62
63.16
Lobbying
0.00
0.00
0.00
0.00
0.00
2.63
Remuneration
0.00
0.00
9.38
0.00
3.45
2.63
Corruption
Environment
Giving/
community
CSR areas
Human rights
mentioned
% OF CSR
REPORTS
Country
% OF CSR
REPORTS
% OF CSR
REPORTS
% OF CSR
REPORTS
Germany
Period
1995-99
% OF CSR
REPORTS
% OF CSR
REPORTS
USA
2005-06
2012-13
1995-99
2005-06
2012-13
Business
partners
72.73
42.31
50.00
10.00
27.59
26.32
Community
9.09
53.85
15.63
80.00
93.10
55.26
Customers
90.91
65.38
81.25
60.00
65.52
47.37
Employees
45.45
84.62
93.75
80.00
82.76
47.37
27.27
34.62
75.00
0.00
10.34
7.89
9.09
34.62
18.75
0.00
17.24
13.16
State
Regulators
45.45
26.92
37.50
30.00
27.59
15.79
Shareholders
27.27
53.85
21.88
20.00
41.38
23.68
Suppliers
0.00
11.54
31.25
30.00
20.69
18.42
Trade Unions
0.00
15.38
3.13
0.00
0.00
0.00
Stakeholders IOs
mentioned
NGOs
% OF CSR
REPORTS
Country
% OF CSR
REPORTS
% OF CSR
REPORTS
Germany
Period
Global
CSR
norms
% OF CSR
REPORTS
% OF CSR
REPORTS
% OF CSR
REPORTS
USA
1995-99
2005-06
2012-13
1995-99
2005-06
2012-13
Continuous improvement
18.18
7.69
9.38
0.00
10.34
7.89
Materiality
0.00
0.00
15.63
10.00
6.90
28.95
Stakeholder dialogue
9.09
42.31
34.38
0.00
17.24
15.79
Sustainability
81.82
88.46
87.50
30.00
51.72
71.05
Transparency
9.09
38.46
34.38
0.00
27.59
26.32
% OF CSR
REPORTS
% OF CSR
REPORTS
% OF CSR
REPORTS
Country
% OF CSR
REPORTS
% OF CSR
REPORTS
% OF CSR
REPORTS
Germany
Period
USA
1995-99
2005-06
2012-13
1995-99
2005-06
2012-13
GRI
0.00
15.38
25.00
0.00
6.90
2.63
ISO 14001
9.09
0.00
0.00
20.00
6.90
2.63
0.00
0.00
0.00
0.00
0.00
0.00
0.00
7.69
68.75
0.00
0.00
5.26
0.00
7.69
9.38
0.00
0.00
0.00
Code
SA 8000
participation
UN Global Compact
UN Guiding
Principles
Analyzing Changing Nature of TNCs’ Social Responsibilities
• TNCs’ expanded notion of social responsibility.
– Moving from liability to social connection model
• Notions of responsibility are mediated by home
country traditions.
– Citizenship (US) v stakeholder capitalism (Germany)
• Notions of responsibility are also mediated by issue.
– Success of environmental sustainability
engagement
Social Connection Model of CSR
We seek broad partnerships and collaborations to bring
about innovative solutions to some of the world’s most
pressing problems…[W]e identified those we can
impact: increasing access and affordability of medicine;
meeting the needs of emerging markets: furthering
human rights; managing our supply chain; ecologically
designing products, managing our environmental
impacts; meeting global health needs…(Gorsky 2012).
National Imprints of Global CSR
Being a responsible company is integral to our success and we are engaged on
the issues that matter most to our customers, employees and communities…I’m
proud of the impact we make each day through volunteering and philanthropy,
the revitalization of our neighborhoods, and our involvement in so many
important issues, including hunger relief, education, job training, the
environment and support for our military and veterans (Moynihan 2012).
[Our] sphere of influence does not end at the factory gates or in the
salesrooms, but includes the interests of all stakeholders – of customers and
employees, shareholders, business partners and other interest groups. That is
why the BMW Group seeks dialogue with all stakeholders and constantly
exchanges ideas with institutions, associations and nongovernmental
organisations. For we have to talk to one another if we are to understand and
shape the future together (Panke 2006).
Differential Engagement by Issue:
Success of Environmental Sustainability
It’s not just a matter of preserving an intact environment
worth living in – it’s also a matter of sustainable economic
development. The earlier and more systematically we
reduce our emissions and improve our energy efficiency,
the lower the price we’ll have to pay. And whoever is the
first to recognize that and establish reliable conditions to
work in will be rewarded with investment, growth and
jobs (Diekmann, 2013).
Conclusions
• Firms have increasingly expanded :
– the social issues for which they claim responsibility
– stakeholders to whom they are responsible
– accountability practices they engage in
• Some convergence across US and German TNCs but clear
home country effect.
– national traditions v. embeddedness in national markets
• Engagement with global CSR norms varies greatly by issue
– Future research should examine why firms are willing to take
responsibility for some social problems and not others.