ABSTRACT:This article assesses the proliferation of international accountability standards (IAS) in the recent past. We provide a comprehensive overview about the different types of standards and discuss their role as part of a new institutional infrastructure for corporate responsibility. Based on this, it is argued that IAS can advance corporate responsibility on a global level because they contribute to the closure of some omnipresent governance gaps. IAS also improve the preparedness of an organization to give an explanation and a justification (...) to relevant stakeholders for its judgments, intentions, acts and omissions when appropriately called upon to do so. However, IAS also face a variety of problems impeding their potential to help address social and environmental issues. The contribution of the four articles in this special section is discussed in the context of standards’ problems and opportunities. The article closes by outlining a research agenda to further develop and extend the scholarly debate around IAS. (shrink)

There are relatively few empirical studies on the impacts of corporate social responsibility policies and programs. This article addresses the research gap by analyzing the incidence of, and the conditions that affect, decoupling among CSR policies, implementation of CSR programs, and CSR impacts for various environmental and social issues. Complete decoupling is a condition of full divergence among policies, programs, and impacts amounting to purely ceremonial CSR. Using ratings from a sustainability rating agency on a sample of about 1,000 large (...) companies in 24 countries, the authors find empirical evidence not supporting a conclusion of complete decoupling. The empirical evidence suggests four levels of nondivergence in the sample. First, for most CSR issues examined, CSR policies of high quality do have relatively strong effects on CSR implementation. Second, CSR programs of high quality do have relatively strong effects on CSR impacts. Third, for most CSR issues, even low-quality CSR policies enforce the incidence and quality of programs in comparison with having no policy at all. Fourth, weak programs have more impact on the realization of CSR goals than having no program at all. The authors also find that the quality of CSR reporting and locating the responsibility for CSR at the board level reduce decoupling by strengthening the quality of CSR programs. (shrink)

Introducing and implementing corporate sustainability poses many challenges to business organizations. In this longitudinal, inductive study, we focus on how such challenges are handled in a Dutch bank that is developing its sustainability policies. We examine why there is such a high degree of tension and conflict within the organization and identify how the development of these policies is affected by the interplay between subcultures and institutional logics. We show how different subcultures affect the enactment of logics by infusing the (...) rational and mindful behavior coming from logics with (sub)cultural values, beliefs, and assumptions. In turn, conflicting logics amplify subcultural characteristics between groups by shaping different behavior and practices. Together, this leads to a magnification of subcultural differences while, at the same time, logics are increasingly being perceived as incompatible. (shrink)

In the corporate social responsibility literature, the principle of voluntarism is predominant and implies that responsible business activities are discretionary and reach beyond the rule of law. This principle fails to explain that governments have a great interest in CSR and exercise influence on firms’ CSR activities. Therefore, we argue in favour of a contingency approach on voluntarism in CSR. To this end, we analyse the academic literature to demonstrate how governments are part of the CSR debate. We selected 703 (...) papers where the impact of governments is mentioned from five journals in our field in the period 1982–2011. We studied the titles and abstracts of these papers and provide an overview of: the geographical orientation of the reviewed studies; the variety of government levels involved; and the various subjects where governments appear to be involved. In addition, an in-depth reading of a subsample of 39 articles offers more details on the role of governments in the CSR literature. Hence, we offer a structured overview on the discussion of CSR and governments while stimulating a contingent understanding of the voluntarism concept in CSR. (shrink)

In the corporate social responsibility (CSR) literature, the principle of voluntarism is predominant and implies that responsible business activities are discretionary and reach beyond the rule of law. This principle fails to explain that governments have a great interest in CSR and exercise influence on firms’ CSR activities. Therefore, we argue in favour of a contingency approach on voluntarism in CSR. To this end, we analyse the academic literature to demonstrate how governments are part of the CSR debate. We selected (...) 703 papers where the impact of governments is mentioned from five journals in our field (BEER, BEQ, BSE, BAS, JBE) in the period 1982–2011. We studied the titles and abstracts of these papers and provide an overview of: (i) the geographical orientation of the reviewed studies; (ii) the variety of government levels involved; and (iii) the various subjects where governments appear to be involved. In addition, an in‐depth reading of a subsample of 39 articles offers more details on the role of governments in the CSR literature. Hence, we offer a structured overview on the discussion of CSR and governments while stimulating a contingent understanding of the voluntarism concept in CSR. (shrink)

This study examines the variations in corporate social orientations across developed and developing countries in the context of a legitimacy threat. Conceptualizing CSO as signals, the author develops and validates a seven-code index of CSO that identifies executive orientations toward multiple stakeholders. Using this index on CEO shareholder letters from the United States, Germany, and India, the author finds that firms signal a multi-stakeholder image toward employees, communities, and environment during good times to enhance their social license to operate, and (...) yet such signals are not carried through during the threat period. This disconnect in signaling in the wake of a legitimacy threat is indicative of decoupling in corporate orientations and exposes the multi-dimensionality of the CSO concept. By adding a cross-national and temporal dimension, this research contributes toward better understanding the complexity behind CSOs and opens new areas for future research. (shrink)

The growing global prominence of Chinese state-owned enterprises brings new dimensions to our understanding of multi-national corporations and human rights issues. This article constructs a three-level framework that enables the mapping of transnational, national, and intra-organizational human rights pressures, and uses this framework to identify and analyze the human rights that Chinese SOEs report concern with. The analysis provided suggests that while China’s most global SOEs are subject to transnational pressures to respect all human rights, such pressures appear outweighed by (...) those encouraging them to concentrate on only some human rights within their national and intra-organizational environment. The article concludes by identifying a number of ways in which our conceptual framework and empirical findings can inform future research. (shrink)

For four decades, research on the role and responsibilities of business in society has centered on the business case for corporate social responsibility (CSR) and an increasing number of studies on the corporate social performance (CSP)—corporate financial performance (CFP) link emerged leading to controversial results. Heeding the call for a deeper understanding of the mechanisms linking certain CSR efforts to certain performance outcomes, this study provides a stakeholder-based organizing framework rooted in an extensive review of existing literature on the link (...) between CSP and CFP. In so doing, we aim at guiding research and practice toward less simplistic understandings of the CSP–CFP connection, thus advancing the debate over the consequences of voluntary integrating CSR into business operations and into relationships with stakeholders. By disentangling specific drivers and outcomes of the CSP–CFP link, we underline the importance of setting clear boundaries and specifying levels of analysis to generate comparable results. (shrink)

The purpose of this article is to problematise a particular social transparency and disclosure regulation in the UK, that transcend national boundaries in order to control slavery in supply chains operating in the developing world. Drawing on notions from the regulatory and sociology literature, i.e. transparency and normativity, and by interviewing anti-slavery activists and experts, this study explores the limitations of the disclosure and transparency requirements of the UK Modern Slavery Act and, more specifically, how anti-slavery activists experience and interpret (...) the new regulations and the regulators’ implementation of the regulation. This research found limited confidence among anti-slavery activists regarding the Act’s call for transparency in relation to the elimination of slavery from global supply chains. The research also found that the limits of the transparency provisions within the Act appear to hinder the attainment of normativity. This study provides new and unique insights into the critical role that social activists play in exposing the lack of corporate transparency and failures of responsibility to protect workers within global supply chains. (shrink)

Public officials rely on performance data that are self-reported by organizations to evaluate progress on a wide range of prosocial outcomes. Policies that require public disclosure of performance in health care are thought to enable patients to select high-quality providers, which in turn may spur quality improvements as providers seek to protect their reputation or increase economic returns. Drawing on institutional theory that examines how conflicting institutional pressures influence organizational decisions, we theorize how profit orientation may mediate the response of (...) health care providers to disclosure mandates in a public health crisis. We focus on measures of data quality—completeness and accuracy—in self-reported data on COVID-19 status and outcomes generated by thousands of long-term care facilities. Using pooled regressions and a difference-in-differences style design, we find that overall, for-profit and not-for-profit facilities report similarly complete data but that for-profit facilities report less accurate data than their not-for-profit counterparts. Our results suggest that it may be important to incentivize each dimension of data quality separately to address differential institutional pressures that affect reporting practices. (shrink)

In this article, we consider a recent trend whereby private equity available from venture capital firms is being deployed toward mission-driven initiatives in the form of impact investing. Acting as hybrid organizations, these impact investors aim to achieve financial results while also targeting companies and funds to achieve social impact. However, potential mission drift in these VCs, which we define as a decoupling between the investments made and intended aims, might become detrimental to the simultaneous financial and social goals of (...) such firms. Based on a content analysis of mission statements, we assess mission drift and the hybridization level of VC impact investors by examining their missions and their investment practices through the criteria of social and financial logic. After examining eight impact-oriented VC investors and their investments in 164 companies, we find mission drift manifest as a disparity between the means and ends in half of the VC impact investors in our sample. We discuss these findings and make suggestions for further studies. (shrink)

This paper presents an examination of the relationship between the presence and composition of a corporate social responsibility (CSR) committee on the corporate governance board and CSR decoupling. Using a sample of listed firms drawn from 41 countries, we found that the presence of a CSR committee on the corporate board is negatively associated with CSR decoupling. We also noted that the nature of the industry to which a firm belongs, a firm's level of CSR orientation, and corporate governance quality (...) strengthen such association. Further analysis of the relationship between the structure of the CSR committee and CSR decoupling shows that larger CSR committee size and a greater independence and longer tenure of its members negatively affect CSR decoupling. Our results are robust to various alternative specifications and offer important research and managerial implications. The findings of this study contribute to the growing literature on corporate governance and CSR. (shrink)

Greenwashing is a phenomenon that is linked to scandals that often occur at the supply-chain level. Nevertheless, research on this subject remains in its infancy; much more is needed to advance our understanding of stakeholders’ reactions to greenwashing. We propose here a new typology of greenwashing, based on the locus of discrepancy, i.e. the point along the supply-chain where the discrepancy between ‘responsible words’ and ‘irresponsible walks’ occurs. With three experiments, we tested how the different forms of greenwashing affect stakeholders’ (...) reactions, from both ethical and business perspectives. We developed our hypotheses by building on attribution theory, which seeks to account for how observers construct perceptions about events. We had anticipated that the more internal, controllable and intentional the discrepancy is, the greater the blame attributed to a company is, and the lower the intention to invest will be. When greenwashing occurs at a company level, this results in a higher level of blame attribution, while the intention to invest falls. Indirect greenwashing refers to a misbehaviour perpetrated by a supplier who claims to be sustainable, and which results in a less negative impact on a supplied company. We also propose the vicarious greenwashing, which occurs when the behaviour of a supplier is in breach of a company’s claims of sustainability. This type of greenwashing is nevertheless detrimental to investment. The findings here advance our understanding of how greenwashing shapes stakeholders’ reactions, and highlight the need for the careful management of the supply-chain. (shrink)

Corporate responsibility has often been criticised as a decoupled organisational phenomenon: a publicly espoused rule that is not followed in daily organisational practices. We argue that a crucial reason for this criticism arises from the dominant in-house assumption of CR literature, which mitigates tensions and contradictions in organisational life by claiming that integrated rules result in coupled practices. We aim to provide new insights by problematising this in-house assumption and by examining how members of two organisations discursively make sense of (...) CR, as a daily rule-bound practice, via three strategies: integration, differentiation and fragmentation. We elaborate the contemporary literature on CR as a daily organisational practice by examining the significance of discursive sensemaking for organisational rules for further development and learning regarding CR. We then discuss the significance of our results for understanding CR as a coupled/decoupled phenomenon. (shrink)

Business Ethics: A European Review, EarlyView.

Recent research suggests that corporate social responsibility is institutionalised amongst multinational corporations. Yet CSR scholarship faces considerable challenges. An agreed definition is lacking, even amongst researchers adopting aligned approaches. Studies remain heavily focused on making a business case for CSR, despite its widespread acceptance into business practice. Few studies examine CSR’s on-ground implications for the communities it purports to help, favouring instead a macro-level focus. And concerns about CSR’s sincerity, motivations and ethics perpetuate questions about its integrity. This article argues (...) that new institutionalism is well placed to respond to these core challenges for CSR, and that new institutionalist perspectives can complement and enrich other common theoretical approaches. It contributes a social mechanism-based framework for CSR, identifying and exploring the key social mechanisms that institutionalise it; namely, discourse, mimesis, normative learning and coercion. Understanding CSR as an institution facilitates new and different explorations of its causes and effects and opens new avenues for scholarly inquiry. Illustrative examples from a 3.5-year study of CSR in the global mining industry are presented to explore the implications of CSR as an institution and to suggest pathways for innovative research. (shrink)

AbstractEnduring unethical behavior in trading has generated much research interest, and scholars disagree on the reasons for this situation. According to MacIntyre (2015), this has to do with the personal traits of traders, whereas Rocchi and Thunder (2019) argue this is due to permissive work environment that can potentially be changed to favoring ethical trading. We contribute to this debate by exploring how interactions between organizational culture and management control systems (MCSs) may affect the enduring unethical behaviors of traders. We (...) conceptualize this with the concepts of organized hypocrisy (Brunsson 1986, 1989, 1993) and decoupling (Meyer and Rowan 1977). An in-depth case study of fraud (Jerome Kerviel at Societe Generale), informs the empirical inquiry. We develop the concept of organized decoupling to characterize how the MCSs are articulated with the organizational culture favoring unethical behavior, while being used as a ‘safety mechanism’ to manage the legal and reputational risk of the bank. The analysis highlights three key features of the organized decoupling of MCS: physical distance, technical distance and social distance. The study contribution lies in showing that decoupling is not only emergent but might be intended and therefore organized. The findings also raise doubts on the role of MCSs in monitoring trading activities as presented by investment banking institutions and regulators, suggesting more organized hypocrisy, and raising significant concerns regarding the creation of tolerable work environment welcoming ethical behaviors in the investment banking sector. (shrink)

Prior research on corporate misconduct pays extensive attention to single misconduct behaviors. However, little research has addressed recidivism – the repeated behaviors of corporate misconduct. Based on institutional theory and using the context of emerging economies where recidivism plays a considerable role, we propose the path dependency of corporate recidivism and suggest that three influential factors exist: internal preconditioning, inter-organizational imitation, and the prevailing external evaluation. Our event history analysis of 1,036 listed companies in China over the period 2001–2008 statistically (...) confirms our hypotheses. We conclude the paper by outlining the implications for both theory and practice. (shrink)

This paper capitalizes on an institutional perspective to analyze corporate social responsibility (CSR) orientations in the Lebanese context. Specifically, the paper compiles a new theoretical framework drawing on a multi-level model of institutional flows by Scott (Institutions and organizations: ideas and interests, 2008 ) and the explicit/implicit CSR model by Matten and Moon (Acad Manag Rev 33(2):404–424, 2008 ). This new theoretical framework is then used to explore the CSR convergence versus divergence question in a developing country context. The findings (...) highlight the usefulness of the compiled multi-layered institutional framework and the varied nuances and profound insights it offers in analyzing CSR in context. They also suggest that a cosmetic level of global convergence in explicit CSR may materialize in light of mimetic isomorphic pressures, but that the path dependence hypothesis is indeed salient in light of national history trajectories and socio-politico configurations. The findings correspond most closely to patterns of CSR crossvergence, combining elements of both convergence and divergence, and reflecting in complex hybridized CSR expressions. The findings and their implications are presented and assessed. (shrink)

ABSTRACT:Existing research on certifiable management standards (CMS) and corporate social responsibility (CSR) tends to focus on large companies and is characterised by disagreement about the role of these standards as drivers of CSR. We contribute to the literature by shifting the analytical focus to the behaviour of small and medium-sized enterprises (SMEs) that subscribe to multiple CSR related standards. We argue that, in respect of motive and commitment, SMEs are not as different from large companies as the literature suggests, as (...) they are guided by similar institutional and economic motives. Results, based on ISO 9001, ISO 14001 and OHSAS 18001 certified SMEs in Greece, demonstrate that later adopters are more susceptible to coercive and mimetic motives and are less likely to commit fully to the CMS requirements, while earlier adopters react to normative motives and considerations of internal efficiency gains and tend to carry out CMS requirements with greater diligence. (shrink)

International Accountability Standards have proliferated in the last 20 years, with the UN Global Compact as the most widely accepted principle-based standard catalyzing voluntary participation by firms. This study aims to improve understanding about the factors that determine companies’ progress in adopting principle-based standards. Drawing on the resource-based view of the firm, we examine the direct and combined influences of different organizational resources on standard implementation as perceived by 213 Spanish GC signatories. Our results reveal that the level of firm-specific (...) resources has a positive effect on the extent of GC principles implementation and that innovative capability and length of GC participation strengthen this effect. Contrary to our expectations, we find that the internationalization of firms does not have an effect on GC principles implementation. We discuss the implications of these findings for scholars and practicing managers. (shrink)

In examining how reform-leading supranational institutions respond to public criticism, this article advances current theory on their institutional accountability mechanisms and extends research on this topic by focusing on their responses to public criticism of alleged reform failures. We consider the case of the International Monetary Fund’s (IMF’s) involvement in the Greek economic crisis, as the structural adjustment reforms it imposed to stabilize the economy. We show how these controversial and, by many accounts, failed policies have profoundly impacted the well-being (...) of the recipient country by reducing social cohesion and impoverishing the most vulnerable groups. In explaining the IMF’s institutional response mechanism for fending off such criticism, we offer moral regulatory appropriation (MRA) as a processual framework and present the IMF’s organizing logic of institutional legitimation processes in four domains of action: agentic mission, reform policies, institutional policy negotiations, and moral appropriation. We argue that this enables institutions to maintain moral legitimacy despite evidence of their reforms’ policy failure and various negative consequences for their populations. The proposed framework has theoretical implications for conceptualizing the rhetorical deployment of moral legitimation to secure and defend institutional accountability. We also highlight the limitations and boundaries of such an approach by the IMF and similar reform-leading institutions. (shrink)

In this article we explore how multinational corporations (MNCs) adopt assurance practices to develop and sustain organizational accountability for sustainability. Using a panel of Fortune Global 250 firms over a period of 10 years, we document the diffusion patterns of third-party assurance of sustainability reports. We specifically investigate how evolving auditing practices, namely diversity of assurance standards and type of assurance providers, shape the quality of sustainability assurance statements. The results illustrate great variability in the adoption of assurance practices in (...) the formative stages of this novel market. Our descriptive analysis indicates the relevance of external institutional pressure as well as internal resources and capabilities as underlying factors driving the adoption of assurance. Our evidence also suggests that several MNCs project a decoupled or symbolic image of accountability through assurance, thereby undermining the credibility of these verification practices. The paper contributes to the emerging literature on international accountability standards and emphasizes the need to enhance theory-based, cross-disciplinary knowledge related to auditing and accountability processes for sustainability. (shrink)

Given the nature and importance of Islamic banks in recent times, we can expect them to have significant intellectual capital anchored in their Sharia‐based knowledge and expertise. However, we know very little or nothing about how and why intellectual capital‐related information is provided in their corporate reports. We fill this gap in our existing knowledge of the field with a view to enhance relevant literature. As far as we know, this article is one of the earliest exploratory attempts to examine (...) intellectual capital reporting practices of an Islamic bank. We have undertaken a longitudinal (2001–2015) case study related to the intellectual capital reporting practices of an Islamic bank. Key results include significant rise of intellectual capital reporting over time, dominance of internal capital‐related items in intellectual capital reporting profile and the dynamics of changes in intellectual capital reporting practices over time. Through an institutional theory lens, we explain that this is due to the changes in the external institutional environment and various intra‐organisational factors such as strong ethical culture, unique knowledge base (Sharia), and corporate governance regime. (shrink)

To achieve effective stakeholder governance in the context of international social accountability certification requires constructing a network of agreement. In a case study of a small-to-medium-sized enterprise, we examine managers’ attempts at enrolling participants in the supply chain to investigate how they strive to engage these stakeholders. We adopt actor-network theory and sensemaking theory to develop a novel approach to understanding social accountability standards’ certification in stakeholder networks. We argue that the design and operation of any SA standard across a (...) network requires not only attempts at enrolling other participants in the supply chain but management contextualizing and problematizing the terms of their involvement. (shrink)

I here distinguish dissensual from consensual corporate social responsibility (CSR) on the grounds that the former is more concerned to organize (or portray) corporate-civil society disagreement than it is corporate-civil society agreement. In doing so, I first conceive of consensual CSR, and identify a positive and negative view thereof. Second, I conceive of dissensual CSR, and suggest that it can be actualized through the construction of dissent enabling, rather than consent-oriented, public spheres. Following this, I describe four actor-centred institutional theories—i.e. (...) a sociological, ethical, transformative and economic perspective, respectively—and suggest that an economic perspective is generally well suited to explaining CSR activities at the organizational level. Accordingly, I then use the economic perspective to analyse a dissent enabling public sphere that Shell has constructed, and within which Greenpeace participated. In particular, I explain Shell’s employment of dissensual CSR in terms of their core business interests; and identify some potential implications thereof for Shell, Greenpeace, and society more generally. In concluding, I highlight a number of ways in which the present paper can inform future research on business and society interactions. (shrink)

Sustainability is increasingly a matter of concern in the corporate world. Many business scholars have analyzed the phenomenon from institutional and cultural perspectives, addressing the key questions of what drives the spread of sustainability principles, and also why sustainability adoption varies so widely among organizations and cultures. In this article, we propose that sustainability adoption can be better explained by integrating the insights from the institutional and cultural perspectives. This would break the current practice of choosing one approach or the (...) other, a trend that has estranged these fields despite their obvious overlap in questions, core constructs, and theoretic arguments. We therefore introduce a model that emphasizes a dual-effect of culture—namely, culture plays a role in "norming" the proliferation of sustainability-relevant institutions, while also influencing the "conforming" to pressures for sustainability emanating from these institutions. We offer theoretic insights not only for explaining sustainability adoption but also for addressing the recognized challenge of bringing culture back into institutional theory. (shrink)

Voluntary management standards for social and environmental performance ideally help to define and improve firms’ related capabilities. These standards, however, have largely failed to improve such performance as intended. Over-emphasis on institutional factors leading to adoption of these standards has neglected the role of firms’ existing capabilities. External pressures can drive firms to adopt standards more than their technical capacity to employ them. This can lead to problems of “fit” between institutional requirements and a firm’s existing capabilities . We describe (...) a conceptual model that considers the impact of an interaction between a firm’s institutional requirements and its existing capabilities on standards failure. We suggest solutions that align institutional requirements to appropriate governance forms as a means to improve standards success. We contribute to theory by describing the role of firms’ internal capabilities to the success of voluntary management standards and the reliability of self-regulation generally. (shrink)