Running Just to Stand Still? Managing CSR Reputation in an Era of Ratcheting Expectations

Abstract

This paper presents the findings of a qualitative field study undertaken with senior managers responsible for their firm's corporate social responsibility (CSR) activities to explore the interaction between a firm's reputation for CSR and the actions of its industry peers; the actions of its industry; and the actions of other firms in its local geographic community. Examining this phenomenon from an institutional perspective, we seek to explain how and why CSR norms become institutionalized both within and across industries. Specifically, we develop a model to explain the diffusion of CSR norms; a process that we argue results in slowly ratcheting expectations over time. We propose that firms in sensitive industries face and respond to higher stakeholder expectations for CSR. In response, elite firms operating in the same geographic community across a range of industries take cues from the firms operating in industries with higher expectations for CSR. Thus, norms for CSR are established among the elite firms within a geographic community rather than within industries. These norms are then diffused within industries through mimetic forces. This creates a cycle whereby the general diffusion of these norms creates a new expectations gap for firms in high visibility industries. Their subsequent response will launch another cycle and, over time, raise expectations for CSR for all firms in the geographic region regardless of industry.

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Acknowledgements

Order of authorship was randomized and is shared equally. We gratefully acknowledge the valuable insights of three anonymous reviewers and the two editors of this issue. We also recognize support from the Erb Institute for Global Sustainable Enterprise at the University of Michigan and from the Social Sciences and Humanities Research Council of Canada.

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APPENDIX

APPENDIX

Initial Interview Guide and Coding

Themes

Although the interviews were largely unstructured, and later interviews were guided by earlier ones, the following questions served as the basis for the initial discussions:

  • — Why does your firm engage in corporate philanthropy or community involvement?

  • — What responsibilities does your firm have to the community?

  • — What causes does the firm support?

  • — How does the firm decide which causes will be supported?

  • — What kind of causes are considered and why?

  • — What are your competitors doing with respect to community involvement?

  • — Who in your opinion is doing a good job in their community involvement? Why?

  • — Which stakeholders are considered in the decision?

  • — Do you ever cooperate with other firms in community involvement initiatives?

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Bertels, S., Peloza, J. Running Just to Stand Still? Managing CSR Reputation in an Era of Ratcheting Expectations. Corp Reputation Rev 11, 56–72 (2008). https://doi.org/10.1057/crr.2008.1

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Keywords

  • CSR
  • CSR creep
  • industry
  • ratcheting expectations
  • reputation