Can mandated adoption of corporate social responsibility (CSR) improve firm value? Most CSR adoption is purely voluntary. However, governments regularly encourage CSR adoption with soft regulations that vary from simply endorsing and symbolically supporting CSR to requiring the adoption of specific practices. Governments have resisted fully mandating CSR because there is some concern universally that mandated CSR may reduce firm value. There is, however, no empirical clarity as to whether mandated CSR impedes or improves firm value. We address this uncertainty (...) by analyzing the effects of the mandated adoption of CSR that the government of India legislated in 2014. Drawing on a sample of 1,526 publicly traded firms and deploying a combinative analytical framework comprising an event study, regression discontinuity design, and a difference-in-differences technique, we conclude that India’s CSR mandate did, in fact, increase value for all firms bound by the mandate. This value-enhancing effect was greater for foreign firms relative to domestic firms. Our results refute previous research showing that India’s CSR mandate diminished firm value. (shrink)

Firms engage in social responsibility activities for diverse reasons. This study focuses on understanding firms' instrumental motivations for engaging in socially responsible activities. We suggest that the instrumental motivations underlying firms' corporate social responsibility engagement are associated with their market, learning, and risk-related behaviors; thus, we identify market orientation, learning orientation, and risk-taking attitudes as three constructs that influence firms' CSR engagement. This research was conducted in the Norwegian firewood sector, in which CSR expectations are high and in which we (...) expect CSR engagement to be encouraged by both instrumental and normative motivations. The firms in this study are micro-firms with fewer than 10 employees and represent an important but highly neglected segment of firms in CSR research. Data obtained from 230 firms were analyzed using structural equation modeling. Our results indicate that market orientation, learning orientation, and risk-taking attitudes affect social responsibility toward different stakeholder groups in different ways. In some cases, the size and age of firms also affect these relationships. (shrink)

The business case for social responsibility is one of the most widely studied topics in the business and society literature that focuses on large firms. This attention is understandable because large firms have an obligation to shareholders who, as commonly assumed, seek to maximize returns on their investments, in turn, pressing corporate managers to show that firms’ expenditures in social engagement would pay off. Small firms, on the other hand, rarely face such pressures, yet the BCSR logic is increasingly applied (...) to small firms as well. Our primary objective in this paper is to examine whether and how much do small firm owners’ perceptions of BCSR affect the firm’s social engagement. In finding a fine-grained answer to those questions, we consider BCSR as a two-dimensional construct consisting of tangible and intangible benefits, and also integrate the BCSR perspective with the slack resource perspective to offer a motivation-capacity lens to examine firm’s social engagement. Drawing on a multi-industry sample of 478 small firms in the US, we find that while small firm owners’ perceptions about potential tangible benefits of social engagement are not related to the firm’s social engagement, perceptions about potential intangible are positively related. Firm's financial performance is also positively related to its social engagement, but there is no interaction between potential benefits and financial performance. This study contributes to an improved understanding about small firms’ social engagement, which still remains an understudied area. Our results are in line with studies which argue that firms’ social engagement is a response to institutional factors. (shrink)

We propose that firms that engage in morally imaginative sensemaking will manage society's changing ethical expectations more effectively than those engaging in habituated sensemaking. Specifically, we argue that managers engaging in habituated sensemaking will tend to view changes in expectations as threats and respond to them defensively. In contrast, morally imaginative managers will tend to see these same changes as opportunities and address them by proactively or interactively engaging stakeholders in learning processes. We contribute to the literature on moral imagination (...) by highlighting the value of moral imagination relative to conventional sensemaking, and by positioning moral imagination as an ongoing mode of sensemaking. While we recognize that managers' capacity to continuously address changing ethical expectations using moral imagination is constrained by cognitive limitations, we posit that morally imaginative sensemaking may economize on cognitive resources over time by enabling managers to avoid managing ethical issues unproductively based on habit. We also contribute to the issues management literature by calling attention to two underlying factors, managerial sensemaking mode and firm enterprise strategy, that drive companies' approaches to issues management. (shrink)

Media organizations engaging in journalistic production face ethical challenges that concern business ethics as much as journalism ethics. This article studies expectations of responsibility for media organizations that engage in journalistic production and assesses them from the viewpoint of sector-specific corporate responsibility. The data are obtained from interviews with Finnish nongovernmental organization experts who work closely with media issues. Of the three positive and three negative expectation themes identified, audience enabling was associated with most confidence. Audience enabling deals with the (...) impacts of media products and social connectivity that links media organizations into larger societal processes and issues. It is concluded that without the synchronization of journalism ethics and business ethics, it can be difficult to address complex corporate responsibility issues. (shrink)