Academic journal article Review of Business

Social Demand and Corporate Supply: A Corporate Social Responsibility Model

Academic journal article Review of Business

Social Demand and Corporate Supply: A Corporate Social Responsibility Model

Article excerpt

Corporate social responsibility has been the subject of considerable attention and debate for many years among researchers and practitioners. In response to numerous demands that corporations play a more energetic role in the overall welfare of society, many businesses have in recent years given considerable attention to the social impact of their economic activities. This has prompted some organizations to introduce codes of ethical conduct and to actively accommodate the interests of various groups in society by engaging in certain purely social endeavors |14,28~.

In spite of these efforts, business executives are often perplexed by the continuous expansion of society's expectations of corporations. For example, in the corporate world, numerous laws and extensive government regulation affect virtually every aspect of business activities. They touch "almost every business decision ranging from the production of goods and services to their packaging, distribution, marketing, and service" |5~. In such an increasingly legalized business environment, corporate executives are fully aware of society's criminal and civil sanctions. The impact of this knowledge on managerial attitudes and behavior has been widely discussed and documented in both the popular and academic literature |29,22,10,8~. Thus, not only are managers held responsible for maximizing profits for the owners and shareholders and for operating within the legal framework, they are also expected to support their employees' quality of work life, to demonstrate their concern for the communities within which their businesses operate, to minimize the impact of various hazards on the global environment, and to engage in purely social or philanthropic endeavors. Furthermore, managers are puzzled when they discover that certain business practices are acceptable in one community but are not tolerated in another.

Within the academic community, the notion that business firms should be attentive to the needs of a diverse group of constituents having a claim on the organization has been the subject of vigorous discussion and investigation for over two decades. Business educators have attempted to address this issue by discussing social and ethical issues in business ethics or business-and-society courses or by infusing these subjects throughout the business school curriculum |18~.

Among researchers, this issue has provoked an especially rich and diverse literature investigating the role of business in society. Indeed, the Academy of Management recently established a separate division to address this issue. Research in this area has followed two major streams. The most popular of these studies have focused on the relationship between a firm's social responsibility and its financial performance |15,2,25,17,26~. The other stream of studies has examined the effect of board members' demographic and non-demographic characteristics on their individual corporate social responsiveness orientation |12,13~.

Despite these research efforts and the continued preoccupation on the part of both researchers and practitioners with the role of business in society, relatively little attention has been devoted to the development of conceptual models for analyzing and understanding the relationship between business and its larger environment. Recently, the Social Issues Division of the Academy of Management held a symposium on the state of the field |6,19~. Prominent speakers alluded to the fact that a major drawback in the development of the area is the lack of a core of a theoretical and methodological base |20~. Other participants referred to the existence of partial methods which attempt to give limited explanations to this issue by confining themselves to the study of policy processes and business ethics |21~. Limited models have also been developed to highlight the relationship of the firm to society |16,31~. The "rights" model, for example, contends that society has certain claims upon business by virtue of the fact that it grants business the right to conduct its affairs. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.