Corporate Citizenship and Private Regulatory Regimes: Understanding New Governance Roles and Functions

Part of the Studies in Economic Ethics and Philosophy book series (SEEP, volume 40)


Private regulatory regimes have emerged as an increasingly important component of global social ordering, with potentially significant implications for corporate decision-making and the conventional theory of the firm and corporate governance, institutionalization of the values of corporate citizenship, and understandings of the technologies of business ethics. Private regulatory regimes do not operate in the same manner as public international law regimes. This chapter describes three notable features of private rule-making (competition among private rule makers, particular importance of consent as basis for private regulation, and importance of “legitimacy” conferring capabilities on the players). The purpose of this chapter is to explore the connections between private regulatory regimes and concepts such as new governance, corporate citizenship and corporate governance.  Does private rule-making related to corporate citizenship pose new challenges or raise novel questions concerning conventional theories or understandings of the firm and corporate governance, global regulation of corporations, and theories of how social and environmental behaviours of corporations are institutionalized? The main conclusions of the chapter are that yes, private rule making in the global corporate citizenship context stimulates new thinking concerning how and why firms participate in global private rule making pertaining to corporate citizenship, how such activities can be aligned or understood in light of the conventional theories of the firm which downplays relational implicit contracts with stakeholders and sees the firm as a nexus of formal contracts,  and the conventional focus of institutional theory on firms as seekers (not bestowers) of legitimacy. In short, the phenomenon of private regulatory regimes in support of global corporate citizenship stimulates new thinking on a number fronts that in turn suggest new directions in research concerning corporate theory and practice.


Private regulation Governance Corporate citizenship Globalization Legitimacy 


  1. Black, J. 2009. Legitimacy and the competition for regulatory share. LSE Legal Studies Working Paper No. 14/2009.Google Scholar
  2. Boatright, J. 2009. The Implications of the New Governance for Corporate Governance. Paper to be presented at “Corporate Citizenship and the New Governance – The Political Role of Corporate Actors in Societal Rule-Setting Processes,” 12th Annual Conference of “Forum fur Wirtschaftsethik und Wirtschafts- kultur der Deutschen Gesellschaft fur Philosphie (DGPhil),” Wittenberg, Germany, November 26–28, 2009.Google Scholar
  3. Braun, J., and I. Pies. 2009. United Nations global compact. In Handbook of transnational economic governance regimes, eds. C. Tietje and A. Brouder, 253–265. Boston, Leiden: Martinus Nijhoff PublishersGoogle Scholar
  4. Carroll, A. 1979. A three-dimensional conceptual model of corporate performance. Academy of Management Review 4(4): 497–505.Google Scholar
  5. Cashore, B. 2002. Legitimacy and the privatization of environmental governance: How non–state market–driven (NSMD) governance systems gain rule–making authority. Governance 15: 503–529.CrossRefGoogle Scholar
  6. Christmann, P. 2000. Effects of “best practices” of environmental management on cost advantage: the role of complementary assets. Academy of Management Journal 43(4): 663–680.CrossRefGoogle Scholar
  7. Deephouse, D.L. 1996. Does isomorphism legitimate? Academy of Management Journal 39(4): 1024–1039.CrossRefGoogle Scholar
  8. Forest Stewardship Council. 2008. Facts and figures. Accessed 21 Jan 2009.
  9. Global Reporting Initiative. 2009. About Global Reporting Initiative. Accessed 10 Aug 2009.
  10. Hood, Rothstein, and Baldwin. 2001. Government of risk. Oxford: Oxford University Press.CrossRefGoogle Scholar
  11. International Organization for Standardization (ISO). 2007. The ISO survey – 2007. Accessed 21 Jan 2009.
  12. International Organization for Standardization (ISO). 2009. ISO/DIS 26000 Guidance on Social Responsibility (draft). Accessed 10 Aug 2009.
  13. King, Andrew. 2007. Cooperation between corporations and environmental groups: A transaction cost perspective. Academy of Management Review 32(3): 889–900.CrossRefGoogle Scholar
  14. Matten, D., and J. Moon. 2008. “Implicit” and “Explicit” CSR: A conceptual framework for a comparative understanding of corporate social responsibility. Academy of Management Review 33(2): 404–424.Google Scholar
  15. Misani, N. 2009. The convergence of corporate social responsibility practices. Academy practices 2009. SSRN. Accessed 15 Nov 2009.
  16. Moffet, J., F. Bregha, and M.J. Middelkoop. 2004. Responsible care: A case study of a voluntary environmental initiative. In Voluntary codes: Private governance, the public interest, and innovation, ed. K. Webb, 177–208. Ottawa, ON: Carleton Research Unit for Innovation, Science and Environment, Carleton University.Google Scholar
  17. Oliver C. 1991. Strategic responses to institutional processes. Academy of Management Review 16(1): 145–179.Google Scholar
  18. Pies, I., S. Hielscher, and M. Beckmann. 2008. Moral commitments and the societal role of business: An ordonomic approach to corporate citizenship. Business Ethics Quarterly 19(3): 375–401.Google Scholar
  19. Rhone, G., D. Clarke, and K. Webb. 2004. Two voluntary approaches to sustainable forestry practices. In Voluntary codes: Private governance, the public interest, and innovation ed. K. Webb. Ottawa, ON: Carleton Research Unit for Innovation, Science and Environment, Carleton University.Google Scholar
  20. Ruggie, J. 2008. Protect, respect and remedy: A framework for business and human rights. A/HRC/8/5 7 April 2008 Accessed 10 Aug 2009.Google Scholar
  21. Scott, W.R. 2001. Institutions and organizations, 2nd edition. London: Sage.Google Scholar
  22. Scherer, Andreas George, Guido Palazzo, and Dorothée Baumann. 2006. Global rules and private actors: Toward a new role of the transnational corporation in global governance. Business Ethics Quarterly 16: 505–532.Google Scholar
  23. Social Accountability Accreditation Services. 2009. Certified facilities list. Accessed 1 Apr 2009.
  24. Suchman, M. 1995. Managing Legitimacy: Strategic and Institutional Approaches. Academy of Management Review 20(3): 571–561.Google Scholar
  25. Suchman, M. 1998. Working without a Net: The sociology of legal ethics in corporate litigation. Fordham Law Review 67: 837–874.Google Scholar
  26. Teerlak, A. 2007. Order without law? The role of certified management standards in shaping socially desired firm behaviors. Academy of Management Review 32(3): 968–985.CrossRefGoogle Scholar
  27. Thomsen, S. 2006. Corporate governance and corporate social responsibility. In Corporate social responsibility – Reconciling aspiration with application, eds. A. Kakabadse and M. Morsing, 40–50. London: Palgrave McMillan.Google Scholar
  28. Waddock S. 2008. Building a new institutional infrastructure for corporate responsibility. Academy of Management Perspectives 22(3): 87–108.CrossRefGoogle Scholar
  29. Webb, K. 1999. Voluntary initiatives and the law. In Voluntary initiatives: The new politics of corporate greening, ed. R. Gibson, 32–50. Peterborough: Broadview PressGoogle Scholar
  30. Webb, K. ed. 2004. Voluntary codes: Private governance, the public interest and innovation. Ottawa, Carleton Research Unit for Innovation, Science and Environment, Carleton University.Google Scholar
  31. Webb, K. 2011. ISO 26000: the Emergence of a Global Norm of Social Responsibility Custom, Paper presented at European University Institute Florence Workshop on Transnational Governance Interactions: Theoretical Approaches, Empirical Contexts and Practitioners’ Perspectives (May, 2011).Google Scholar
  32. Webb, K., and W. Helms. (forthcoming). Perceived voluntary code legitimacy: Towards a theoretical framework and research agenda. Draft paper presented at AOM Conference, Chicago, August 2009.Google Scholar
  33. Webb, K., and A. Morrison. 2004. Voluntary Codes and the Law: Examining the ‘Tangled Web’. In Voluntary Codes: Private Governance, the Public Interest and Innovation, ed. K. Webb, 97–146. Ottawa: Carleton University Research Unit for Innovation, Science and Environment.Google Scholar

Copyright information

© Springer Science+Business Media B.V. 2011

Authors and Affiliations

  1. 1.Department of Law and BusinessTed Rogers School of Management, Ryerson UniversityTorontoCanada

Personalised recommendations