The Social Lives of Firms: Globalizing Norms v.
National Corporate Social Responsibility Styles
Alvise Favotto, University of Glasgow
Kelly Kollman, University of Glasgow
Patrick Bernhagen, University Aberdeen / Stuttgart
Research Question
• To what extent are large TNCs incorporating global CSR norms
and notions of best practice into management procedures
and structures?
– To what extent is this engagement mediated by a firm’s
home country and the variety of capitalism practiced
within it?
Private Governance / Global Civil Regulation
Literatures
•
Why has private governance emerged and become more prominent?
– Governance gaps opened up by economic globalization (Cutler, Haufler and Porter, 1999;
Braithwaite and Drahos 2000)
– CSR schemes have proliferated but many are underpinned by the core norms of a
growing ‘sustainability field’ (Dingwerth and Pattberg 2009)
•
Why do firms participate?
– Firm-level characteristics: size and sector (Hillman et al 2004)
– Home country characteristics: democracy; national interest group politics,
‘embeddedness’ in transnational networks (Prakash and Potoski 2006; Neumeyer and
Perkins 2010)
•
How do CSR norms and code participation affect firm behavior?
– Mixed findings (Vogel 2005; Prakash and Potoski 2006; Berliner and Prakash 2012)
– Lack of progress due to narrow focus on single codes and a lack of engagement with
finer-grained firm-level data that uncovers linkages between participation and
performance outcomes
Looking Inside the Black Box of the Firm
• Examine firms’ engagement with CSR / private governance
schemes through analysis of firm-level documents, usually
CSR reports (Kolk 2004; Chen and Bovain 2009).
• Firms from the liberal market economies such as the US
engage less substantively with CSR norms than firms from the
coordinated market economies of continental Europe (Van
Tulder et el 2009; Lim and Tsutsui 2012; Hartman et al 2007).
• Firms in CMEs are more ‘culturally attuned’ to integrating
concerns of societal actors into their practices (Van Tulder et
al 2009).
Methods and Data
•
Content analysis of 40 firm CSR reports (20 US and 20 European) drawn from Global
Fortune 500
– Two sub-samples are roughly matched in terms of firm size and mix of sectors
•
A self-generated coding frame for three sections of the reports: management
statement; environmental section; social section (employee concerns / labour rights
/ human rights)
•
Management statements: motivation; global CSR codes mentioned; stakeholders
mentioned; CSR areas mentioned
•
Environment and social sections: management practices; impact areas;
improvement program areas
•
Assess the quality of impact measures and improvement programmes to gauge
‘implementation likelihood’ of individual reports (Kolk 2004)
Results from Management Statements
Theme
Motivation
Theme
Global CSR norms
Theme
Codes Mentioned
Codes
Market
Ethical – environment
Ethical – labor/employee rights
Ethical – human rights
Ethical – community/ giving
Ethical – corruption
Social pressure
Risk management
Legal compliance
Codes
Sustainability
Continuous improvement
Materiality
Transparency
Stakeholder dialogue
Codes
GRI
UN Global Compact
ISO 14001
OECD Guidelines
UN Guiding Principles
Sector-specific programs
CSR awards
Stock market CSR indexes
US (%)
95
60
45
5
80
0
10
5
0
US (%)
35
0
25
30
5
US (%)
0
10
0
0
5
10
10
0
Europe (%)
60
80
60
30
50
25
50
25
15
Europe (%)
85
15
40
40
40
Europe (%)
30
55
10
5
35
20
20
20
Results from Management Statements cont.
Theme
CSR areas mentioned
Theme
Stakeholders mentioned
Codes
Environment
Human rights
Labor/ employee rights
Giving/ community
Corruption
Lobbying
Remuneration
Codes
Shareholders
Business partners
NGO’s
Employees
Community
Political regulators
Customers
Trade unions
Intergovernmental Organizations
Suppliers
US (%)
80
5
45
90
5
5
0
US (%)
45
50
15
80
90
25
70
0
10
10
Europe (%)
100
45
90
50
25
5
5
Europe (%)
50
35
20
95
60
30
80
15
60
25
Social Impact Areas Covered
20
18
16
14
12
10
Europe
8
USA
6
4
2
0
Freedom of Ass.
Collective
Bargaining
Diversity
Health & Safety Child Labour
Forced Labour
Living Wage
Bonus policy
Non-employee
Human Rights
Compliance
Social Improvement Goals Present
20
18
16
14
12
10
Europe
8
USA
6
4
2
0
Freedom of Ass.
Collective
Bargaining
Diversity
Health & Safety
Child Labour
Forced Labour
Living Wage
Bonus policy
Non-employee
Human Rights
Compliance
Environmental Impact Areas Covered
20
18
16
14
12
Europe
10
USA
8
6
4
2
0
Climate Change
Energy
Pollution
Product impact
Resource Use
Compliance
Other
Environmental Improvement Goals Present
20
18
16
14
12
Europe
10
USA
8
6
4
2
0
Climate Change
Energy
Pollution
Product Impact
Resource Use
Compliance
Other
Impact Measures Quality
Social
Environment
0
10
20
30
40
50
60
70
80
90
100
Improvement Goals Quality
Social
Environment
0
10
20
30
40
50
60
70
80
90
100
Implications and Conclusions
•
Results support recent findings that suggest firms in CMEs engage more
substantively with global CSR norms than firms from LMEs—but only in the
social sections.
•
The environmental sections of US and European reports are more similar than
the social sections.
•
The environmental sections of US and European reports are of much higher
quality than social sections, regardless of home country.
•
Findings challenge VoC accounts of CSR engagement:
– Why do US firms engage with environmental norms when they do not appear to engage
substantially with the types of non-market stakeholders that promote such engagement?
– Why do European firms engage more substantively with environmental than social norms /
practices when CMEs are structured to encourage harmonious employee / employer
relations?
Implications and Conclusions cont.
• Why the greater engagement with environmental CSR?
– GRI influence
– Environmental norms appear to be more embedded in global markets than labour
and human rights norms.
– Both European and US firms frequently cite market actors and market motivations
in their management statements.
– Environmental impact areas appear to offer firms greater ‘market’ opportunities
than social areas. (Environmental norms ‘fit’ better with market norms).
• Future research: differential firm engagement across CSR areas in addition
to how engagement is mediated by home country / varieties of capitalism
• Need finer-grained, firm-level data to uncover the nuances of firm
engagement and the management processes that link participation with
performance outcomes.