Stakeholder dynamics as determinants of substantive versus symbolic csr practices: A macro/micro perspective

Abstract

Purpose

Moving beyond the question of whether large corporations are truly addressing sustainability, some scholars have explored the degree to which CSR activities are purely symbolic or substantive in nature. Most of the studies have focused on external stakeholder pressures. The aim of this chapter is to extend this line of inquiry by theorizing that the dynamics among internal stakeholders also shapes CSR conduct.

Design/methodology/approach

This theoretical contribution borrows from research on socially responsible indices, behavioral corporate governance theory in CSR and from recent research that has leveraged attribution theory to better understand reactions to corporate social irresponsibility (CSiR).

Findings

Our chapter proposes that firms adhering to substantive CSR practice are less likely to be punished by external stakeholders than otherwise. From an internal stakeholder viewpoint, it suggests there is a positive relationship between the number of board ties to reputable universities/nonprofit organizations and substantive CSR practices; and a negative relationship between managerial discretion and substantive CSR practices.

Social implications

This chapter can have social applicability as it deals with stakeholders’ role in pressuring the modern organization to engage in substantive CSR.

Originality/value

As aforementioned, most studies explore the relationship between CSR compliance and external stakeholder pressures. In contrast, the relationship between internal stakeholder dynamics and CSR compliances is still not well understood. Hence, the incorporating of these dynamics provides theoretical insights for the CSR, sustainability, and corporate governance arenas.

Citation

Perez-Batres, L.A. and Doh, J.P. (2014), "Stakeholder dynamics as determinants of substantive versus symbolic csr practices: A macro/micro perspective", International Business and Sustainable Development (Progress in International Business Research, Vol. 8), Emerald Group Publishing Limited, Leeds, pp. 249-264. https://doi.org/10.1108/S1745-8862(2013)0000008016