Dissertation/Thesis Abstract

The costs of corporate social responsibility and the role of civil society pressure
by Kayser, Susan A., Ph.D., Indiana University, 2014, 127; 3645007
Abstract (Summary)

Having a reputation for being socially responsible is increasingly important to firm managers. To bolster their reputation, many firms have begun adopting corporate social responsibility (CSR) initiatives. The existing literature has primarily addressed the benefits of engaging in CSR initiatives, but has largely ignored the costs. This dissertation empirically explores the various costs of engaging in CSR and the critical role that civil society plays in creating those costs.

The first study, co-authored with Michael Toffel and John Maxwell, focuses on the non-market costs associated with adopting a CSR initiative. To manage reputational risks associated with supply chains, buyers are increasingly seeking information about their suppliers' labor and environmental performance. We hypothesize particular circumstances in which buyers can screen suppliers that have representative disclosures based on their participation in the Global Compact, which requires a public commitment and a public report. We find that the threat of scrutiny from civil society can deter firms with misrepresentative disclosures from participating.

In the second study, I examine the market response to the apparel industry after the collapse of Rana Plaza. CSR initiatives have been found to help firms preserve firm-value after a negative social or environmental event occurs. However, CSR initiatives may also signal to investors that the firm will respond by self-regulating to help repair the industry's aggregate reputation. I find that firms with CSR initiatives are harmed more so than those without initiatives after the collapse and that this is driven by pressure from civil society, but mitigated when firms can "cash in" on their investments.

In the third study, I analyze whether a company's symbolic policy to protecting the environment will lead to the adoption of a substantive CSR initiative, specifically an environmental management system (EMS). I find that firms with symbolic policies will be especially likely to adopt an EMS when the firm is subject to strong pressures from civil society. I also find that firms with symbolic policies are less likely to adopt an EMS when they face stronger peer pressure, suggesting that firms may use their symbolic policy as a substitute for a more substantive program.

Indexing (document details)
Advisor: Maxwell, John W.
Commitee: Gupta, Nandini, Prince, Jeff T., Simon, Daniel H.
School: Indiana University
Department: Business
School Location: United States -- Indiana
Source: DAI-B 76/03(E), Dissertation Abstracts International
Subjects: Management, Environmental management, Economics
Keywords: Civil society pressure, Corporate social responsibility, Selective disclosure, Substantive vs. symbolic csr
Publication Number: 3645007
ISBN: 978-1-321-33482-1
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