Academic journal article Law & Society Review

Socially Responsible Private Regulation: World-Culture or World-Capitalism?

Academic journal article Law & Society Review

Socially Responsible Private Regulation: World-Culture or World-Capitalism?

Article excerpt

This article analyzes the phenomenon of ''corporate social responsibility'' (CSR; specifically: social private regulation) in light of two sociological paradigms of globalization: ''world-culture'' and ''world-capitalism.'' The study treats three analytically distinct features of CSR: the political contestation over its meaning, the role of business studies in transforming it into a managerial model, and its consolidation as a market of authorities. The study finds that (1) while CSR may be theorized as a emergent ''world cultural'' model, the culture paradigm does not take sufficient account of the role of corporations in shaping it, and (2) while both paradigms recognize the transition from political contestations over the character of CSR to its deployment by means of private regulation, the world-capitalism paradigm offers stronger tools for theorizing the mechanisms of change that mediate between political agency and institutionalized regulatory outcomes.

For several decades, the notion of corporate social responsibility (hereinafter CSR) had been mainly nurtured on the sidelines of corporate activity and business management scholarship (Carroll 1999). In the 1990s, consumer groups and rights organizations began to invoke the notion of CSR in order to convey their normative expectations from corporations, often in respect to the latter's commercial operations in underregulated countries. Yet in the course of less than a decade, CSR has become associated with transnational regulatory frameworks and advanced managerial systems, all in all signaling a major relocation of political authority and important changes in the way law is deployed on a global scale (Vogel 2005).

Also in the 1990s, and in tandem with the changes in the scope and meaning of CSR, there was a major theoretical and empirical shift in the political and legal sciences from the study of governments to that of governance (or ''new governance'') and a corresponding interest in private and self-regulation (or ''soft law'') (Braithwaite & Drahos 2000; Rosenau & Czempiel 1992). Inasmuch as CSR announces the licensing of corporations and other nonstate entities to act as private social and environmental regulators (of themselves and of others), CSR is indeed a strong case of transnational governance in the making (Conley & Williams 2005; Scott 2008): increased participation of nonstate actors in shaping public policy, public-private collaboration, and noncoercive ordering (Lobel 2004; Prakash & Hart 1999; Rosenau 2007; Ruggie 2001).1

The phenomenon of commercial agents acting in the capacity of private authorities and engaging in norm creation and norm enforcement has many historical precedents. However, such norm creation in the past was almost exclusively concerned with ordering relations of economic exchange (Cutler et al. 1999). The novelty of CSR is that it encourages commercial and civic entities to promulgate social and environmental norms that were heretofore thought to be the domain of public authorities in general and of state governments in particular. Acting in the name of social responsibility, commercial enterprises now increasingly perform tasks that were once considered to reside within the civic domain of moral entrepreneurship and the political domain of the caring welfare state. The notion of CSR has expanded to mark the proliferation of self- and private regulatory tools and schemes covering issues such as human rights, community welfare, labor, and the environment.

In its present form, CSR denotes a system of governing that incentivizes corporations not only to obey various standards and criteria of ''social responsibility'' but also to regulate other commercial actors as part of their own socially responsible behavior. In its latest phase, and also within less than a decade, CSR was rediscovered by business schools and became a major area of teaching and research. In the process, CSR was transformed from being associated mainly with displays of good ''corporate citizenship'' to a scientifically validated form of corporate risk management and, more generally, into a perceived commercial asset. …

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