System change not climate change', 2009, UN climate talks in Copenhagen. Photo: kris krüg via Flickr (CC BY-NC-ND).
Ideas for Leaders #603

How Social Movements Spark Corporate Social Responsibility Initiatives

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Key Concept

Social movements change society’s expectations of a company, as well as influence the thinking and values of individuals in that company. Under ideological pressure from diverse categories of external and internal stakeholders, the company responds with a corporate social responsibility agenda. 

Idea Summary

What is the role of social movements in inspiring or sparking corporate social responsibility?

To answer this question, Panayiotis Georgallis of the University of Michigan’s Erb Institute for Global Sustainable Enterprise builds on the academic research related to social movements and to corporate social responsibility, which are two distinct fields of research.

Social movements are ideological in nature: they involve ideas about how society should be. Successful social movements ‘frame’ their ideas in a way that resonates with people. A social movement’s ability to ‘craft resonance’ impacts a company at three levels — field level, firm level and individual level — creating, as described below, the conditions in which a company will want to launch corporate social initiatives. (Georgallis prefers the phrase ‘corporate social initiatives’ to ‘corporate social responsibility’ because the debate on whether a corporation has a responsibility to society is not relevant to his framework.)

At the field level, social movement ideologies influence four categories of a company’s key external stakeholders as follows: the general public changes its expectations of how the business should be acting; consumers are more likely to purchase from companies that meet these expectations; potential employees will prefer to be hired by such companies; and, finally, regulators will likely develop and enforce policies that ensure companies abide by those expectations.

At the firm level, social movement campaigns put firm reputation at risk by targeting recalcitrant companies, including using actions such as protests and boycotts. In an effort to manage their reputation, companies will respond with corporate social initiatives. Some responses might only be symbolic (such as a corporate social responsibility board), but even symbolic gestures will eventually change corporate activities and attitudes as these gestures invite more scrutiny from from external and internal stakeholders.

In response to social movement campaigns, some companies will go beyond reputation management by collaborating with organizations related to the movement. A company is considered ‘legitimate’ when its behaviours and attitudes meet society’s expectations. By collaborating with social movement organizations, a company in essence ‘borrows’ the legitimacy of these organizations as its own.

At the individual level, social movement campaigns impact the values of managers and employees within the company. The ideologies advanced by the social movements resonate with these internal stakeholders, who change or adjust their personal values accordingly. The growing acceptance of certain ideologies also requires management to devote more time to thinking about those ideologies. For example, as the expectations of diversity grow, managers recognize that social initiatives based on increasing diversity have become more feasible — and more urgent.

Social movements spark corporate social responsibility initiatives through the interplay of the just-described mechanisms at the three levels. Changing expectations of the company’s external stakeholders (field-level pressure) pushes firms to take firm-level actions to manage their reputations and restore legitimacy (firm-level initiatives). Internally, meanwhile, social movements influence ideologies of managers and employees (individual level thinking and values), which also leads to firm-level initiatives through bottom-up pressure.

Business Application

This article explains the link between social movements in society, and corporate social responsibility initiatives. The set of changing attitudes, values and expectations of the company’s internal and external stakeholders is the engine through which social movements inspire or catalyse CSR activities.

Companies should take steps to remain aware and responsive to these changing attitudes, values and expectations. At stake is not only the company’s reputation, but also its legitimacy as an accepted member of society. There was a time in which companies believed that the only criterion for legitimacy was shareholder value. That time has passed. 

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Authors

Institutions

Source

Idea conceived

  • April 2016

Idea posted

  • April 2016

DOI number

10.13007/603

Subject

Real Time Analytics