The current issue of M & M can be found at: www.managementmarketing.ro
Corporate social responsibility versus
corporate social irresponsibility
Mirela Popa
Babeş‐Bolyai University, Cluj‐Napoca, Romania
Irina Salanță
Babeş‐Bolyai University, Cluj‐Napoca, Romania
Abstract: Corporate social responsibility (CSR) has been an intensively researched topic
in the last decades. More and more scientists manifested interest in this concept and
elaborated various definitions. Gradually, CSR evolved from a theoretical concept to a
complex managerial tool used to build a company’s reputation and enlarge its
competitive advantage. It was soon a must have for more and more companies. Although
only large corporations used it at first, today CSR is part of the business strategy of many
small and medium size companies also. The more popular it became, the more it grew in
complexity and the idea of corporate social irresponsibility arose. Corporate social
irresponsibility (CSI) refers to the dark side, as it investigates the wrongful and
damaging business decisions that managers might take. In this article we provide a
viewpoint on the conceptualization of the two topics and the distinction between them.
Through an evaluation of the academic literature, we provide an explanatory view of
corporate social responsibility and corporate social irresponsibility emphasizing their
most popular definitions, historical development and relevance for companies. The
opinions expressed in the article can be useful for both academia and managers as we
give suggestions on finding ways to reduce CSI and enhance CSR.
Keywords: corporate social responsibility, corporate social irresponsibility, organizational
social responsibility.
Please cite this article as following: Popa, M. and Salanță, I. (2014), “Corporate social responsibility
versus corporate social iresponsibility”, Management & Marketing. Challenges for the Knowledge
Society, Vol. 9, No. 2, pp. 137‐146.
Introduction
Corporate social responsibility (CSR) has been a very popular topic in the last
decades. There are a large number of definitions of this concept in the
literature and, consequently there is also too little consensus regarding the
best one. We consider that CSR best describes the many ways in which
companies choose to manage their business and conduct their efforts to create
a positive and desirable impact on society in general (Salanţă and Popa, 2013).
In this paper we investigate both the positive efforts regarding corporate social
responsibility and also the less desirable effects implied by the corporate social
irresponsibility that may exist if managers do not pay enough attention to the
consequences of their day‐to‐day decisions. In the first part of the paper we
Correspondence:
Mirela Popa
mirela.popa@econ.ubbcluj.ro
M & M
138
present the most commonly used definitions of CSR and also some important
contributions in the history and development of the concept. Then, corporate
social responsibility is compared to corporate social irresponsibility. The
article builds upon several trends in the history of these concepts. Further on,
we particularize both concepts with examples from the business world.
Consequently, we compare and contrast some practical examples with the
purpose of devising some suggestions to enhance the positive behavior of
managers. Our work is useful both to managers and academia as it can be
further developed and empirically tested.
Corporate social responsibility: definitions and brief history
There are studies that underline the fact that people have a more positive
image of a firm that supports a cause, for instance 83% of U.S. respondents feel
this way in a study made by Ellen et al., (2000). The same team states that 86%
of their U.K. respondents would be more likely to purchase from a company
associated with a cause (idem). This is one facet of what today is called the
social responsibility of businesses. Even if there have been many papers on this
topic, there is no agreed definition of corporate social responsibility
(Armstrong and Green, 2013, p. 1926). In a sophisticated analysis of CSR
definitions Matten and Moon (2008) conclude that the lack of common
definition for this concept is explained by the fact that: (1) CSR is an umbrella
term for a high number of related concepts, and (2) CSR naturally evolved over
time as value in business changes. We consider that CSR is still worth
investigating as it is a complex concept that has been theorized in a number of
fields such as economics, management, business ethics, political theory,
sociology and even legal philosophy (Richter, 2011).
Some of the pioneers of this field, according to Cochran (2007), were
Columbia professor Adolf A. Berle and Harvard professor Merrick Dodd who
debated the nature of CSR in the Harvard Law Review in the early 1930s.
Whereas Berle “contended that managers were responsible only for the firms”
shareholders, Dodd argued that managers had a wider range of responsibilities
(Cochran, 2007, p. 449). Other authors argue that Howard Bowen (1953) is
the father of the CSR movement, and Archie B. Carrol (1979) might be
considered his son because, more than any other academic, he made CSR his
life’s work (Murphy and Schlegelmilch, 2013).
Corporate social responsibility has had more than 60 years to evolve from
an ambiguous concept to a powerful management tool that managers use to
gain certain advantages. Surprisingly, this term is a generous one that
encompasses various overlapping areas, such as corporate citizenship,
stakeholder theory, business ethics, and corporate sustainability (Freeman and
Hasnaoui, 2011). Others assign even more terms to delimitate the cluster‐
concept of CSR, such as corporate environmental and social responsibility,
corporate social performance, philanthropy, sustainable development and the
triple bottom line (Windsor, 2013, p. 1939). Friedman (1970), on the other
hand, considers CSR as the extension of the firm’s efforts to maximize
Vol. 9 No. 2 Summer, pp. 137‐146, ISSN 1842‐0206 | Management & Marketing. Challenges for the Knowledge Society
shareholders’ wealth while conforming to the basic rules of society. The most
frequently mentioned paradigm regarding CSR is the one connecting it to the
idea of “doing good”, consequently researchers often define CSR as the
“requirement of corporations to make additional contributions to the well‐
being of society” (Carrol and Shabana, 2010, p. 85).
Today corporate social responsibility can be viewed as an organization’s
attempts to achieve a balance between the economic, environmental and social
imperatives without foregoing the expectations of shareholders, and give
something back to the wider community (Gossling and Vocht, 2007). Mainly,
corporate social responsibilities are the organization’s obligation to best serve
society (Schermerhorn, 2012). Acting in a socially responsible manner requires
not only respecting legal requirements, but also going beyond them through
voluntary investments in human capital, in environmental management and in
relationship with all stakeholders. There is a commonly accepted belief that
CSR includes all the responsibilities businesses have to society that go beyond
shareholder wealth maximization (Font et al., 2012) which are, as Carroll
(1979) wrote, legal, ethical, discretionary and, added later, philanthropic ones.
Even though CSR has proved over and over its long‐term advantages for
companies, there are still certain authors that are against CSR practices, naming
them harmful both at the level of the individual and in relation to the economy
as a whole (Henderson, 2009). Some reasons against CSR refer to: (1) costs
incurred by investing in different social programs (which limit profit
maximization), (2) the lack of knowledge or of skilled human resources to best
handle CSR, (3) lack of consistent legal regulations concerning social actions.
Moreover, CSR could be done strictly with the government help and the
involvement of non‐profit organizations, but we disagree and consider it is
important that more and more companies engage in CSR activities and adapt
their CSR strategy to the risk level the organization is willing to take. In this
sense, a strategic audit on the social investments can be elaborated. Even if CSR
seen as a strategic tool was first available only to big corporations, it has
proven its utility and it can be used and applied by any company regardless of
the size or sector of activity (for example: state organizations or other non‐
profit organizations). Under this condition the term “organizational social
responsibility (OSR)” can be used.
Last but not least, according to Gond and Moon (2011) corporate social
responsibility is usually associated to: (1) business responsibility for society as
some companies decide to invest in CSR out of the wrong reasons such as
compensating for a negative outcome; (2) business responsibility to society as
the overall organizational accountability and strong CSR policy are means for
achieving competitive advantage; (3) responsible business conduct reflected in
all area of a company; (4) the management of corporation‐society interface as
CSR is more than a way of giving back to society. The first idea hints towards an
irresponsible use of CSR, one in which the “doing good” is used to cover some
“doing bad” in other areas or that firms may be told or forced to take actions
that seem socially responsible to some people, but are regarded as socially
Vol. 9 No. 2 Summer, pp. 137‐146, ISSN 1842‐0206 | Management & Marketing. Challenges for the Knowledge Society
Corporate
social
139
M & M
140
irresponsible by others (Armstrong and Green, 2013). Consequently, we find
the need to elaborate on the matter of the way in which companies act
irresponsibly.
Corporate social irresponsibility: definition and brief history
The simplest and most relevant way to describe the concept of corporate social
irresponsibility is the one used by Herzig and Moon (2013). They link it to CSR
saying that this refers to the business responses to the expectations of society,
and according to them CSI is the failure of businesses to meet these
expectations (Herzig and Moon, 2013, p. 1870). Lange and Washburn (2012)
relate corporate social irresponsibility to concepts such as corporate
culpability and undesirability. Irresponsibility, in its various forms such as
corruption, bribery, environmental degradation, and social injustice, is most
frequently found in poorer regions, those with fewer social resources or
educational opportunities (Sanchez‐Runde et al., 2013, p. 690). In trying to
define corporate social irresponsibility other authors point to more complex
interlinks with responsibility. Devinney (2009) argues that although
stakeholders tend to penalize unethical behavior, this does not mean they will
reward the ethical ones. Other authors take matters a little bit further and
explain the fact that the benefits of CSR can also motivate organizations to hide
their controversial CSI activities by diverting attention of the stakeholders to
less important activities (Perks et al., 2013, p. 1882).
Table 1. Summary of CSI research
Author, year
Conceptualization of CSI
Armstrong, 1977
“A socially irresponsible act is a decision to accept an alternative that is
thought by the decision maker to be inferior to another alternative when the
effects upon all parties are considered” (p. 185).
Ferry, 1962
Irresponsibility is generally understood the antithesis of responsibility.
Brammer and Pavelion, 2005;
CSI is understood in terms of what stakeholders consider to be socially
Lange and Washburn, 2012
irresponsible behavior.
Jones et al., 2009
“CSI is about being reactive as opposed to proactive in addressing corporate
issues and the ways and means by which they relate to wider society” (p. 304).
Greenwood, 2007
“Corporate irresponsibility occurs when the strategic management of
stakeholders does not remain responsibly-neutral” (p. 324).
Christensen and Murphy, 2004 Via Examples: tax avoidance.
deMaCarty, 2009
Via examples: criminal fraud, price-fixing, bid rigging, bribery, and tax evasion.
Fox, 1996
Via examples: unnecessary worker injuries, environmental degradation,
resource waste, and contribution to economic inequality.
Frooman, 1997
Via examples: false advertising, environment pollution, hazardous products,
product recalls, safety violation, and price-fixing.
Ireland, 2010
Via examples: corporate malfeasance, reckless risk taking, opportunistic
behavior, ruthless pursuit of shareholders value.
Karme, 1981
Via examples: auto theft.
Source: adapted after Lin‐Hi and Muller, 2013, pp. 1930‐1931.
In Table 1 we illustrated a summary of CSI research over the years and it
becomes clear that the most facile way to understand what irresponsible means
is through the use of examples. So in order to define CSI, we can agree upon the
fact that there is a connection of the concept to unethical behavior and to failing
Vol. 9 No. 2 Summer, pp. 137‐146, ISSN 1842‐0206 | Management & Marketing. Challenges for the Knowledge Society
expectations. Some frequently seen examples of CSI refer to discrimination in
the work place, unfair treatment of employees, violation of human rights,
providing false or incomplete product information to customers, fraud of any
kind, price‐fixing strategies, cheating business partners, damaging the
environment, and the list could go on. Some of the famous big companies that
were associated which such violations and bad behavior are: Enron, Procter
and Gamble, Unilever, Siemens, and we can find many more if we search the
web.
CSR versus CSI
The bad behavior encountered in the managerial practice has increased the
focus on CSR strategies seen as a solution to compensate for the harm done.
CSR was developed around 1950s and 1960s when the United States of
America witnessed the birth of the modern activist movement (Cochran, 2007).
Along with this there was a rising interest for the environment, the social and
the consumer movement which dramatically shaped the business world and
channeled it toward CSR by attracting unwanted media attention to unethical
behavior. For corporations such as the Atlantic Richfield, CSR emerged initially
as a reaction to the biggest threat the company was faced with, along with the
whole oil industry, and it simply was a reaction to the crisis posed by the
contingences of the oil business (Brown, 2008).
In practice CSR and CSI are very much connected. If we consider the early
1960s in USA, we observe the birth of CSR that arose, at least initially, not as a
model example of organizational proactivity, but rather as reactions to crises.
Corporate social responsibility was triggered by the public opinion, the
decreasing favorable public perception of major corporations, among of a
whole range of other economically, socially, culturally and politically dominant
institutions (idem). Out of necessity, companies back in those days found in CSR
activities a way to compensate for wrongdoing, to react and save themselves
from the threats of the time.
Moreover, in practice things were viewed a little bit different compared to
the advancements made by the theoretical researches. The assumption that
CSR programs were a managerial intention to do well is wrong. We cannot
stress enough the fact that authors show that in practice the “origin of
corporate social responsibility programs was not broad and deep ethical
idealism, but a reaction to immediate and probable crisis: not only the threat to
corporate operation, but the longer‐term paralysis” (Brown, 2008, p. 2). Some
companies even say that CSR is their ‘social license to operate’, and we are
referring here to Lundin Petrolium, a giant from Sweden. The same company
declares that they do not engage in CSR for window‐dressing purposes and
underline the long‐term benefits of such strategy (Isaksson et al., 2014, p. 64).
In this global market place companies must find ways to reduce and
eliminate CSI, as it is easier and easier for wrong doings to come to light with
the help of social media and the Internet. All in all, we can still encounter
instances of corporate social irresponsibility in practice, and the examples are
Vol. 9 No. 2 Summer, pp. 137‐146, ISSN 1842‐0206 | Management & Marketing. Challenges for the Knowledge Society
Corporate
social
141
M & M
142
to be found everywhere, in every industry sector. For instance, we can mention
here the British Petroleum example of the big oil spill in 2010 that generated a
huge loss for the company and whose tremendous consequences still cost the
company enormous sums of money. Or we can consider the case of the fashion
company Tommy Hilfiger whose name was wrongly associated with child labor
in sweatshops in Burma. Due to the involvement of a group of activists the
apparel producer’s sales dropped and suffered financial consequences for being
perceived as an unethical company (Isaksson et al., 2014, p. 65). On the other
hand we can invoke the example of Primark (an Irish fashion retailer) of good
CSR, as they invest large amount of money to their CSR campaigns and use a
strategic approach to very carefully selecting highly ethical providers.
Table 2. CSI versus CSR
CSI view
Environmental degradation and pollution
are inevitable and little precaution is taken.
Employees are a resource to be exploited.
Minimal community consultation and
involvement.
Only basic, and sometimes reluctant,
compliance with legislation pertaining to
CSR.
Ethical issues are on the periphery.
New technologies should be developed and
introduced to the market.
Treating suppliers and customers unfairly.
Sustainability defined in terms of business
survival.
Profit is the sole purpose of the business
and must be achieved at any cost.
Source: Murphy and Schlegelmilch, 2013.
CSR view
Environmental degradation and pollution are not inevitable and
should not be tolerated, and it is important to raise awareness
and commit to action.
Employees are a resource to be valued.
Maximum community consultation and involvement.
Compliance with, as well as policy and practical actions that go
beyond the minimum legislative requirements for CSR.
Ethical issues are central to the organization.
New technologies should be developed, tested, evaluated and
only introduced to market if they do not cause harm.
Working fairly with suppliers and customers.
Sustainability defined in terms of business, environment and
community survival and mutual growth.
Profit is one of many purposes of the business and should be
achieved, but not at any cost.
In table 2, we present some corporate social irresponsible views and the
positive spin to the responsible approach. We consider this approach as being
useful as it is not enough to simply state a list of wrongdoings, it is also
important to offer solutions on how irresponsible behavior can be reduced.
It is a fact that more and more companies behave irresponsibly. A recent
study developed on Romanian small and medium size companies showed that
when it came to defining CSR managers referred to it as ‘being a good citizen’ or
as ‘doing the right thing’ (Salanţă and Popa, 2013). Also, the same study showed
that business managers were most concerned with surviving on the market
than they were on building a strong CSR policy. CSR occurs when companies
accept social responsibility and integrate it into their core business strategy
(London, 2012, p. 221). In the last two decades, in Romania we can identify a
small number of organizations that know‐how and want to undertake social
responsibilities. Most companies understand wrongly the concept of CSR and
stick to small philanthropic activities, voluntary programs and small donations.
Even if some Romanian companies invest in CSR from time to time the
Vol. 9 No. 2 Summer, pp. 137‐146, ISSN 1842‐0206 | Management & Marketing. Challenges for the Knowledge Society
campaigns are more often not sufficiently elaborated to attract the real long‐
term benefits. CSR must not be mistaken for strictly philanthropy, charity, or
donation. A socially responsible organization should follow all stakeholders’
interests, including those for the environment and society in general. Another
study that underlines CSR and CSI in the business world is the one conducted in
2011 by the members of the National Association of Corporate Directors on the
priorities of their companies. The results of their survey showed the fact that
corporate social responsibility ranked among the first priorities of the board
only for 1.5% of the respondents (Crespin, 2012).
Suggestions on how to reduce corporate social irresponsibility
One important source of corporate social irresponsibility is managerial
unethical behavior; consequently others copy the phenomenon as people
submit to authority. In the decision making process managers must avoid
ethical lapses. These are the result of decision making that contradicts the
individual’s beliefs and the companies’ policies. Ethical lapses are most often
generated by incredible pressure from outside the organization, but also from
the inside.
One good way to reduce unethical/bad behavior is to reduce the chances
that managers will make irresponsible decisions by offering them tasks
consistent with responsible behavior (Armstrong and Green, 2013). One way to
do that is to constantly remind them their obligations towards the fair
treatment of all stakeholders. Another instrument used to reduce
irresponsibility is the company’s Code of Ethics. But this has been argued
sometimes as not being the most effective method. For instance, Jondle et al.
(2014, p. 30) argue that creating formal codes of ethics and conducting ethics
trainings is necessary, but insufficient as ethical behavior is promoted and
facilitated by an ethical business culture. Consequently, other formal measures
can be taken: naming an ethical officer, creating an ethics committee
establishing a guide to give clear directions in ethical decision making,
encouraging and protecting whistle blowers, developing ethics and CSR
training programs. Also, it is important to use social audits for periodically
measuring and reporting performance of different areas of CSR.
Besides these internal ways to enhance positive conduct there are also some
external ones too. One method to reduce CSI is for the public opinion to spread
the information about the misconduct and to severely penalize any CSI act. We
can easily accomplish this through the use and access to Internet and
consequently to social media sites and fast information sharing. For instance
there is a site that annually gives “awards” for the worst behavior in business.
In 2014 they gave the Public Eye Awards for worst record in terms of
environmental pollution and human rights violation to Gazprom and Gap based
on votes received from the readers (The Public Eye Awards, 2014). Other web
pages, on the other hand, monitor the good acts and makes a ranking of the
