Stakeholder influence capacity and the variability of financial returns to corporate social responsibility

Barnett, Michael L. (2005) Stakeholder influence capacity and the variability of financial returns to corporate social responsibility. In: International Association for Business & Society Conference, April 2005, Sonoma Valley, California. (Unpublished)

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Should corporations serve as agents of social change? For more than 30 years, scholars have attempted to make a "business case" that demonstrates that corporations should because they can earn positive financial returns from social responsibility. However, the business case remains unproven. This paper argues that research on the business case must account for the path dependent nature of firm-stakeholder relations, and develops the construct of stakeholder influence capacity (SIC) to fill this void. SIC helps explain why the effects of corporate social responsibility (CSR) on corporate financial performance (CFP) vary across firms and across time, and so provides a missing link in the study of the business case. This paper distinguishes CSR from related and confounded corporate resource allocations and from corporate social performance (CSP), then incorporates SIC into a conceptual framework that illustrates how acts of CSR are transformed into CFP through stakeholder relationships. This paper also develops a set of propositions to aid future research on the contingencies that produce variable financial returns to investments in CSR.

Item Type: Conference or Workshop Item (Paper)
Keywords: Corporate social responsibility; Corporate social performance; Corporate financial performance; Stakeholder influence capacity; Stakeholder theory
Subject(s): Strategy; Entrepreneurship & Global business
Centre: Faculty of Strategy, Entrepreneurship and International Business
Date Deposited: 05 Mar 2012 21:34
Last Modified: 23 Oct 2015 14:06

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