Stakeholder Orientation for Social Value Creation: A Case Study

Purpose In today’s business landscape, organizations face increasing expectations to deliver on social value goals. The finance function is under pressure to evolve from traditional reporting to actively promoting social value creation initiatives that encompass Environmental, Social and Governance (ESG), Corporate Social Responsibility (CSR) and Equality, Diversity and Inclusion (EDI). This study explores whether the finance function should limit itself to reporting on social value (the reporter role), or conversely take a leading role and transition from a compliance-oriented focus to a more active role in social value creation (the promoter role). Design/methodology/approach Utilizing a structured three-stage methodology, this research combines a literature review, interviews with senior finance experts and insights from round table sessions. The Balanced Scorecard framework is applied to structure the collected information. Findings The study results show a divided financial function, both in the literature and in practice. There are clearly proponents of limiting the finance function to the reporter role, while there are also many financial professionals who want to have the promoter role. This latter group does see a progressive model wherein finance functions can transition through three stages: reporting, integration into business partnering and leadership in social value initiatives. Research limitations/implications This study’s reliance on a limited set of academic and managerial sources may not capture the full range of perspectives on the finance function’s evolving role in social value creation. The relatively small number of participants in roundtable discussions, due to network limitations, could restrict the generalizability of findings. Future research should explore additional keywords, databases and expand participant numbers to enhance the diversity of insights. Bringing finance experts and roundtable participants together could provide a more comprehensive viewpoint on finance’s potential role as either a reporter or promoter of social value. Practical implications The study offers a structured pathway for finance functions transitioning from reporting to actively promoting social value creation. This process, structured across reporting, business partnering and leadership stages, provides finance professionals with a practical guide to expand their roles. Finance leaders may consider enhancing skills in sustainability and collaboration while addressing obstacles such as mindset shifts and compliance-focused constraints. The findings support finance functions in establishing internal dialogues on their role in social value, helping align strategic objectives with social impact initiatives to meet organizational and societal expectations. Originality/value This research addresses a key gap in the literature by offering a state of affairs regarding the position of the finance function toward the issue of social value creation in the organization. The research also offers a phased approach to those finance professionals who want to expand their role in social value creation.

Abstract: This study conceptualizes what a ‘strategic turn’ means in corporate social responsibility (hereafter CSR) and what that might mean for conceptions of the relationships between society, economy and the natural environment.We first explore the notion of strategic CSR, analyzing its drivers, components and definition, based on the existing discussions on the subject. There are several reasons for companies to engage in responsible action; by exploring them, we aim to understand the fundamental motivations, which influence investment in CSR and also the factors that have an impact in those decisions. In our perspective strategic CSR involves the confluence of three conditions: the integration of environmental and social concerns into a company’s strategy; the creation of social value; and an effective alignment between CSR’s strategy formulation and execution. Adopting a strategic CSR character results from CSR being taken as an intentional act from companies aiming at some specific benefits for society, the natural environment and themselves. We, therefore, explore the meaning of these conditions and their implications for management. Our main goal is to discuss some fundamental concepts and eventually referencing some areas that deserve additional research.

Three Models of Corporate Social Responsibility: Interrelationships between Theory, Research, and Practice

Research Summary The post‐Enron era is marked with growing discourse of stakeholders, sustainability, and corporate social responsibility (CSR). Yet, commentators debate whether U.S. corporations have indeed moved toward a stakeholder orientation, given the difficulties in measuring such a shift. We assess this shift by examining corporate governance practices, especially the prevalence of shareholder‐ and stakeholder‐oriented practices in chief executive officer (CEO) dismissals. Using data on large firms in 1980–2015, we found that, before the 2000s, CEOs were less heavily penalized for poor firm performance when they demonstrated a shareholder orientation by downsizing and refocusing the corporation and more heavily penalized for CSR activity. This trend, however, reversed after the early 2000s. This article provides evidence of the evolution of U.S. firms' governance practices from a shareholder toward stakeholder orientation. Managerial Summary Many people are skeptical of the assertion that U.S. corporations have become more stakeholder‐oriented over time. It is no wonder, as scant evidence exists for this claim. We tackle this claim head on by analyzing firm practices in 1980–2015 that contributed to chief executive officer (CEO) dismissal when the firm was performing poorly. Some practices, such as downsizing and firm refocusing, are associated with a shareholder orientation and others, such as CSR, are associated with a stakeholder orientation. We found strong evidence for a growing trend toward a stakeholder orientation. When the firm was performing poorly before the 2000s, CEOs were more likely to be dismissed for CSR activities and less likely to be dismissed for downsizing or refocusing the firm. This trend reversed in the early 2000s.

This chapter explores ABC’s corporate social responsibility, stakeholder orientation, and organizational moral development in support of their Vision, Mission, and Values (VMV). It also gages how the company connects with and adheres to sustainable practices and corporate citizenship. The chapter considers the different Corporate Social Responsibility (CSR) initiatives that ABC carries out to advance its competitiveness, navigates the microenvironment, and, in a larger context, adapts to the global community. The Sustainable Development Goals (SDGs) serve as a standard for CSR development, and the chapter also considers ABC’s efforts towards the 17 SDGs of the United Nations. The SDGs serve as a global call to action and focus efforts on issues like eradicating poverty, preserving the environment, and defending people’s right to live in peace and prosperity. When it comes to coordinating resources and efforts to aid minorities, underprivileged, and impoverished areas worldwide, the UAE is a pioneer. The objective of this chapter is to offer actionable insights in support of sustainability leadership, inclusive of three case questions. The case explores themes such as ethical alignment, organizational culture, stakeholders, and leadership practices in support of the case objective. It establishes an indispensable educational resource for industry, academia, and executive education regarding the chosen phenomena. The chapter reflects upon selected leadership practices within ABC towards stakeholders in support of achieving their sustainability goals. It concludes that corporate social responsibility in Dubai is critical and fundamental to the UAE’s long-term social and economic development.

The multi-stakeholder view of corporate social responsibility (CSR) argues that businesses must create value for all the stakeholders, including society at large, not just for owners/shareholders. Creating shared values for all the stakeholders is essential for corporate sustainability, too. To achieve this goal, companies have to perform on all three parameters of the triple bottom line: planet/environment, people/social, and profit/economic. Profit making is the reason for companies’ existence, so obviously, they are capable of performing on economic parameters, but generally, they struggle to outperform on the other two parameters, i.e. social and environment. On the other hand, in the process of social entrepreneurship (SE), social entrepreneurs primarily aim at providing innovative solutions to social problems and creating social value. Most often, social entrepreneurs operate in resource-constrained environments. It clearly shows the interface between CSR and SE on social value creation. Recognising the potential, this chapter presents a conceptual framework for social value creation, integrating both CSR and SE. It also discusses different opportunities to combine CSR and SE that can inspire future initiatives, and further, will contribute to sustainable development and inclusive growth of the country.

A social enterprise may attempt to digitalize its value chain to better fulfil its dual mission; however, the outcomes depend on boundary conditions such as its emphasis on diverse stakeholders, a factor that is rarely examined in the extant literature. Drawing upon stakeholder theory and prior research on digital transformation, this study empirically investigates the strategic fit between stakeholder orientation and value chain digitalization of social enterprises. Using fuzzy‐set qualitative comparative analysis (fsQCA) and data collected from 103 private museums in China, this study identifies multiple equifinal configurations of stakeholder orientations (including visitor, donor and collaborator orientations) and value chain digitalization for social and economic value creation. This study also proposes a sand cone model for the digital transformation of private museums. It extends the application of stakeholder theory in the social enterprise context by highlighting the heterogeneity in stakeholder orientations and revealing the unique contribution of collaborator orientation to the dual mission. In addition, this study offers practical implications for social entrepreneurs and managers concerning digital transformation and value creation.

[Extract] Where is business ethics today? And with this, where are business ethics today? Where do we find them? Are there enough? These questions strike us today, and present us with our starting points. First of all in considering how business ethics has evolved, and what state it is in. But also, in asking where business and ethics are today and how and where they might be in the future. Starting out with these seemingly innocent questions, we face a set of somewhat more troubling questions about the location of business ethics. For some, business ethics is quite easy to locate. When seen as a business function, an academic discipline or a part of business school education, business ethics is often taken as something that obviously has a location. If business ethics is readily locatable, then it can be disciplined, generalised, taught and instituted as part of best practice and corporate strategy. But are business ethics so easily locatable? Are they a 'something' characterised by a 'thingliness' that might allow them to be taken in hand and put to use? If business ethics are not open to such reification, then we might find that ethics in business involves a basic dislocation relating to phenomenal experiences arising when things are out of place. Business ethics would then take place when, as was sensed by Hamlet, things are 'out of joint'. The experience of whistleblowers and the victims of corporate malfeasance is certainly one of deeply felt dislocation. If we find business ethics in these practices, might ethics also be found in other spaces of dislocation?

Linking corporate social responsibility attributions and creativity: Modeling work engagement as a mediator

Purpose Despite the recognised importance of corporate social responsibility (CSR) in higher education institutions (HEIs), research concerning CSR’s influence on employees’ attitudes and behaviours is still understudied. Grounded in the theory of social identity, this study aims to explore CSR’s impact on employees’ work engagement, job satisfaction and organisational identification in an HEI context. Design/methodology/approach Data were collected in a northern Portugal public HEI through a self-administered questionnaire distributed to both teaching and supporting staff. A structural equation modelling (SEM) approach was applied to data collected from 171 employees, using the partial least squares-SEM approach. Findings Overall, the findings show that CSR is strongly associated with work engagement, job satisfaction, identification with the organisation and perceived organisational support, confirming the hypothesised influence of HEI’s CSR development efforts on study-related attitudes. Practical implications Findings reinforce the need for HEIs to integrate CSR and human resource strategies and to pay special attention to CSR communication strategies. Social implications Findings reinforce the need for HEI to develop adequate CSR strategies because these have a significant influence on employees’ satisfaction at work, and thus on employees’ well-being in general. Originality/value This study contributes to attenuate the lack of literature on CSR’s impacts on employee behaviours.

Corporate Social Responsibility (CSR) has become increasingly influential in shaping company behavior, with growing attention to its effects on employee satisfaction and work engagement. We investigate this relationship using a multi-source dataset covering 101 Korean companies over a three-year period (2008-2010), totaling 303 observations. Employing structural equation modeling (SEM), we find that CSR does not significantly affect employee satisfaction and work engagement when considering marketing expenditure. Our results suggest a negative relationship between CSR and marketing expenditure, indicating competing resource allocation. We recommend that firms integrate CSR planning into long-term managerial policies and involve employees in the process to enhance satisfaction and work engagement. Our findings contribute to understanding the complex links between CSR, marketing, and employee outcomes, offering practical insights for effective resource allocation and employee engagement strategies. Keywords Corporate social responsibility (CSR), Marketing expenditure, Employee satisfaction, Structural equation modeling (SEM)

People and other organisms depend on natural resources such as fresh water, land, clean air, wood, and food for critical life requirements and wellbeing. It is well documented that today’s Western way of living and the spread of capitalism is having a detrimental impact on societies and the natural environment. As one of the greatest users of natural and human recourses, many companies have started doing their part in the journey toward Earth’s sustainability and are actively working on translating the idea of sustainable development (SD) into reality. Companies often address SD through their corporate social responsibility (CSR) programs. CSR refers to as a company’s continuing commitment to integrate ecological, social, and economic interests in company’s operations and in its interactions with stakeholders. This commitment is usually done on a voluntary basis (Dahlsrud, 2008). This PhD thesis aims to provide a better understanding of how the CSR adaptation process in private companies can be supported, which is of particular importance and interest since the economic interests (i.e., business case logic) of private companies often clash with CSR objectives. Consequently, adapting to CSR principles can be quite challenging for these companies. Many scholars have attempted to identify factors that can facilitate the CSR adaptation process. However, though any large-scale organizational change requires employees to learn new ways of doing their jobs, the role of learning or human resource development in CSR adaption has remained largely unexplored in the CSR literature. This PhD thesis contributes to this line of research by answering the following research question: Which internal resources related to learning at the organizational and individual level contribute to the CSR adaptation process in private companies? With respect to the organizational level, we found that certain learning organization characteristics can support the CSR adaptation process. We found that stimulating group learning, leadership that encourages learning, and connecting to the local communities are LO characteristics that can directly influence CSR adaptation in a positive way. With respect to the individual level, we found that CSR managers, those managing the CSR adaptation process, need specific individual competencies in order to do their jobs effectively. We identified eight distinct individual competencies (e.g., Balancing personal ethical values and business objectives). We also found that CSR managers have different job roles in the CSR adaptation process. We identified six of these roles (e.g., strategizing role) and showed that the business case logic influences the relative perceived importance of specific individual competencies within each job role. To conclude, the key message of this thesis, and the answer to the research question is two-fold. First, because CSR managers are the ones who actually manage the CSR adaptation process they can play a crucial role in the CSR adaptation process if they possess the right individual competencies. In order to develop these individual competencies, CSR managers should take ownership of their learning process and seek opportunities to learn with and from others. Second, leadership and connecting with external parties are of particular importance to the CSR adaptation process. With respect to connecting with external parties: on the organizational level, having good relations with external parties improves CSR adaptation, because such relationships stimulate learning processes within the company. Furthermore, on the individual level, relationships with external parties promote the development of the individual competencies of the CSR managers responsible for the adaptation process. With respect to leadership: on the organizational level, leadership for learning, referring to active support and stimulation of learning, indirectly affects CSR adaptation; it enhances employees’ learning behavior and therefore improve employees’ cognitive readiness and support for the changes needed to integrate CSR within the company. Furthermore, on the individual level, leadership competencies are essential for driving the changes needed in the CSR adaptation process. This thesis contributes to the literature on the CSR adaptation process in several ways. First, this thesis addresses the issue of the CSR adaptation process from a learning or human resource development perspective and as such complements previous research employing the (human resource) management perspective on CSR. Second, it addresses learning from both the organizational and individual level, thereby providing valuable insights into if and how specific internal resources related to learning can contribute at different levels to the CSR adaptation process in private companies. Third, little is known about how factors on an individual level can support companies in their adaptation to CSR principles and their social performance at large (Aquinis & Glavas, 2012). This doctoral thesis is one of the first providing insights into this matter and demonstrates that learning-related influences on the individual level may be of value to the adaptation process. More specifically, this thesis adds to the literature by (1) identifying the job roles and individual competencies CSR managers need to effectively do their jobs within private companies; previous studies on CSR-related competencies often studied this topic from an educational point of view, thereby not fully addressing the complexity of the business context in which CSR managers operate; (2) by exploring how CSR managers can develop their competencies, which up till now remained unexplored in the CSR literature; and (3) by showing how certain organizational characteristics (i.e., learning climate) and personal characteristics (i.e., learning goal orientation) affect the development of CSR managers’ competencies. There are several implications to be derived from our research with respect to learning (activities) for the benefit of CSR. For one, developing LO characteristics may help companies create favorable conditions for integrating CSR principles. By facilitating learning, companies provide employees with the opportunity to develop their “receptiveness to change”. As such, we suggest that companies experiment with employing LO characteristics to advance the integration of CSR principles. In particular, we suggest that company’s management show leadership for learning by endorsing learning behavior among their employees as this LO characteristic in particular seems to promote the integration of CSR principles. The management can stimulate such behavior by providing employees with continuous opportunities to learn (e.g., provide formal trainings and professional development opportunities), learn in groups (e.g., stimulate team work), and learn with and from external parties (e.g., stimulate stakeholder involvement). Furthermore, it is important for companies to set up and structure a learning system within the company that enables customized learning, meaning a learning system that provides learning opportunities that fit’s the job and needs of individual workers. Companies can enable customized learning among CSR managers by, for example, providing them with flexible working hours and fixed budgets and hours that they can use for professional development. Such a learning system promotes meaningful learning and self-directed learning behavior among employees (Baars-van Moorsel, 2003), which, according to our research, can stimulate the development of CSR-related competencies. To conclude, we hope that this thesis will encourage more research on the role of learning in the CSR adaptation process. Our research provides ample directions to further explore this topic. Furthermore, we hope that this research will inspire CSR professionals to start a dialogue with their employers about their competencies and professional development opportunities or that it inspires them to take control of their learning process and create their own learning network in order to develop their competencies, if needed. Moreover, we hope that by developing the relevant CSR-related competencies, CSR managers will effectively manage the CSR adaptation process and that higher CSR maturity levels are reached and more ambitious sustainability challenges are successfully addressed by private companies.

Do family firms care more for different stakeholders than nonfamily firms when operating in a hostile business environment? This study addresses this question and fills the existing void in family business research. It shows that family‐controlled firms adopt corporate social responsibility strategies and balance the demands of internal and external interest groups to preserve their socio‐emotional wealth while facing fierce competition, resource scarcity, and penurious economic conditions. More specifically, our analysis of an international sample of 956 listed firms from 2006 to 2014 reveals that family firms show a higher level of corporate social responsibility (CSR) performance and better stakeholder orientation than nonfamily firms. Our findings are useful for managers, policymakers, and responsible investors.

Corporate social responsibility (CSR) and business ethics are perceived as distinct constructs by the consumer, although research from this perspective is scarce. Thus, the objective of this study is to investigate the impact of CSR and business ethics on brand fidelity. A theoretical review of CSR, business ethics, brand attitude, brand love, and brand fidelity was undertaken. From these constructs, a theoretical model was proposed, conducting an empirical study with a sample of 559 North American respondents. Through the statistical treatment of data with PLS-SEM, it was demonstrated that business ethics and CSR exert an indirect positive effect on brand fidelity, with relationships mediated by brand love. In turn, brand attitude exerts an indirect effect on brand fidelity, through the mediation of brand love. Based on the results, this study contributes to the approach of CSR and business ethics as distinct constructs and to the consolidation of the brand fidelity construct and its relationships. For management, this study helps organizations to perceive CSR and business ethics as important allies in a brand’s strategy. We conclude that although CSR remains important, customers value business ethics as a critical factor in their perceptions of the brand, contributing more strongly to brand fidelity.

This study integrates attribution and expectancy violation theory to explain market responses to corporate social responsibility (CSR) actions oriented towards primary and secondary stakeholders. We test our model and hypotheses empirically in the context of responsible corporate water actions. We argue that market reactions are affected by two important factors influencing attributions to a CSR action, the stakeholder orientation of the current action and the stakeholder orientation of prior CSR performance, which each shape shareholder beliefs and expectations regarding the firm’s actions. We find the market reaction to a CSR action affecting primary stakeholders is significantly positive given its direct financial and strategic attributions, but it is not significant for actions affecting secondary stakeholders as these involve ethical or altruistic attributions. We further find that expectancy confirmation or violation moderates these stakeholder orientation effects, influencing how shareholders react to CSR actions. Our study is one of the first to explore market reactions to responsible corporate water actions, and apply both attribution and expectancy violation theory to the novel context of market reactions to CSR actions.