corporate social responsibility and corporate reputation thesis

ORIGINAL RESEARCH article

Exploring the relationship between corporate social responsibility, trust, corporate reputation, and brand equity.

• 1 School of Management, Shanghai University, Shanghai, China
• 2 Department of Business Administration, Institute of Social Sciences, Istanbul Okan University, Istanbul, Turkey
• 3 Department of Economics and Statistics, Dr. Hasan Murad School of Management, University of Management and Technology, Lahore, Pakistan
• 4 School of Management, Zhejiang University of Technology, Hangzhou, China

The purpose of this study is to investigate the relationship between corporate social responsibility (CSR), corporate reputation (CR), and brand equity (BE). Building on the resource-based theory of the firm, this study proposes a theoretical framework. In this framework, CSR is theorized to strengthen CR and brand equity, directly and indirectly, through consumer trust. We used a questionnaire survey approach. In the questionnaire, 17 items were used with a 5-point Likert-Scale (1 stands for “strongly disagree,” and 5 stands for “strongly agree”). Data were collected from the consumers of the banking sector in the vicinity of Lahore, Pakistan. To estimate the proposed relationships in the conceptual model, we use structural equation modeling (SEM) through Smart PLS 3.2. The outcomes of this study confirm that CSR significantly impacts CR and brand equity. It is also demonstrated that trust mediates positively and significantly in the relationship between CSR, CR, and BE. Results of the present study have several implications for the senior management, marketing expert, administrators, and policymakers. This study expresses how CSR boosts BE and CR. Moreover, this study also indicates that trust is an important factor that enhances BE and CR.

Introduction

Corporate social responsibility (CSR) is attracting a lot of interest and attention in the competitive world market ( Abbas et al., 2019 ). The importance of CSR may also be revealed in the fact that firms are spending millions on CSR ( Luo and Bhattacharya, 2006 ). However, CSR is an active contributor to building a good reputation and brand equity (BE) in the Pakistani banking sector, particularly in public sector banks (PSBs). Abbas et al. (2019) , argue that CSR is a form of international private business self-regulation which aims to contribute to societal goals of a philanthropic, activist, or charitable nature by engaging in or supporting volunteering or ethically oriented practices. According to Smith (2003) , the success of an organization depends on the strategies that organizations develop to increase their sales through CSR ( Zhou et al., 2021 ). Therefore, organizations build moral capital or assets in intangible forms such as BE and corporate reputation (CR) by investing more in CSR activities. The moral capital of the company acts as an insurance policy, protecting it from negative stakeholder assessments. Companies can also increase their BE by participating in CSR ( Fatma et al., 2015 ).

According to Lai et al. (2010) , BE and CR are considered critical intangible assets to the success of a company in the financial services sector. It is also suggested that a key variable in the consumer-organization association is trust. It has been understood that trust is a factor while considering the prospects of a buyer about behavior regarding CSR perspective ( Vlachos et al., 2009 ). When customers believe an organization is trustworthy and behaves in a socially responsible manner, the evaluation and assessment of a company may be positively affected ( Edinger-Schons et al., 2019 ). In the Pakistani context, the banking sector has been growing and strengthened at a sustained pace with growth in its deposits, advances, and overall profitability. As per the quarterly performance review of the SBP banking sector report from January to June 2018, asset growth in the banking sector is 4.7%, and it stood at Rs. 19,197.1 billion, whereas deposits stood at $13,755 billion ( Zia et al., 2021 ).

The lack of attention paid with respect to contributing to society and the well-being of the community in which they operate has been noted. Furthermore, PSBs generally serve the federal government as well as various provincial governments. As a result, the government becomes its main customer, and they amuse and attract a regular customer base in order to compete in a competitive market ( Arshed et al., 2021 ). As a result, PSBs have strong roots and are well-entrenched in society, and they are seen as a key participant in achieving financial inclusion, financial literacy, and offering commercial services to the general people. However, they are also unaware of their role as CSR participants and the benefits of becoming a good corporate citizen by participating in CSR.

One possible reason is that PSBs are not cognizant that investing in CSR can greatly help build their reputation and brand equity, further attracting customers and their loyalty, thereby increasing their overall profitability. The PSB management and board of directors seem unaware and ignorant about their critical role as CSR participants and good corporate citizens, which can substantially help build a reputation and BE for their organization. Unfortunately, no such study on CSR activities for PSBs in Pakistan has been found that endorses the concept and theory of CSR initiatives that can contribute toward building reputation and brand equity. The results of such a study can significantly help to attract the attention of management and the board of directors of PSB in deciding their future course of action to CSR activities. Based on the above literature insights about CRS, trust, BE, and CR, this study proposes the following questions:

RQ1. Does CSR influence BE and CR?

RQ2. How does trust intervene between BE, CR, and CSR?

This study is organized as follows: section “Hypotheses Framing and Conceptual Framework” describes the hypotheses framing and conceptual model. Section “Research Methods” presents the research methods. Section “Results” is about the data analysis and results, whereas section “Discussions” highlights the discussion of this study. Finally, section “Conclusion” is about the conclusion, limitation, and future research directions.

Literature Review

Corporate social responsibility.

Integration of the interests and business activities of societies needs to be aligned for all organizations operating in society to be beneficial for both organizations and society. According to Crane et al. (2008) , “corporate social responsibility should be considering as a strategic investment form that viewed in establishing or maintaining the corporate reputation,” and this suggests that direct and indirect execution of CSR are viewed via resource-based view (RBV) of a company when these types of leads executions and exercises impact the advantages of the firms. The manageable upper hand can be collected from these immaterial resources on the off chance that they are uncommon, important, and supreme ( Shin and Thai, 2015 ). To comprehend why firms participate in socially mindful exercises, RBV fills in as a valuable apparatus ( Branco and Rodrigues, 2006 ). Customers separate an item from two points of view, for example, vertical separation and even separation. Vertical separation implies the inclinations of a customer for buying items from socially dependable firms, in contrast with others. Vertical separation fortifies CR, enhances BE, and enables the organization to charge additional prices ( Castelo Branco and Lima Rodrigues, 2006 ). Even separation implies that the inclination of shoppers to buy certain items depends on their taste. This study does not enable the organization to charge a premium cost as it has not increased the value of CR also ( Ghaderi et al., 2019 ).

Corporate Reputation

Newburry et al. (2019) define CR as a collective perception of the past activities and beliefs of the firm regarding its future activities. Moreover, Gotsi and Wilson (2001) demonstrate that CR is the future marketing plan that will affect the internal and external stockholders of the organization. Jeffrey et al. (2019) express that CR is a reputation that brings trust and loyalty between consumers and vendors. Furthermore, a good business reputation brings a novel employee recruitment process, employee development, and employee retention. CR refers to the degree and level of a firm being considered and placed in great regard for the perceptions of its partners ( Newburry et al., 2019 ). It can also be considered to summarize all perceptions of the stakeholders toward a firm regarding how it will fulfill or exceed the anticipations ( Rettab and Mellahi, 2019 ; Hameed et al., 2021 ). Also, the reputation of a firm is governed by the indicators of the marketplace regarding its behavior, as understood by stakeholders ( Jeffrey et al., 2019 ).

Brand Equity

Brand equity is a slogan that is used in the marketing industry. The BE shows the value of a well-known brand label. So, based on this idea, organizations develop well-known brand names that increase the revenue of the organizations. Therefore, consumers believe that a well-known product is better than those products that do not have well-known names in the market. Ahmad I. et al. (2019) demonstrate that BE can be referred to as “the additional benefit or maximum worth that increased a product due to its brand name.” Moreover, Hoang et al. (2019) note that a financial approach has been utilized to examine BE. The financial approach indicators include share value fluctuations and accounting base value, where consumer-centric indicators include perpetual ( Chang, 2017 ; Raji et al., 2019 ).

Hypotheses Framing and Conceptual Framework

Corporate reputation and corporate social responsibility.

Corporate social responsibility is a self-regulatory business model that enables a firm to be socially accountable to the organization, stakeholders, and the general public ( Farid et al., 2019 ). CSR allows a company to be aware of its impact on all elements of society, including economic, social, and environmental issues, and being a socially responsible firm can help the image and brand of a company. As a result, CSR allows employees to use the resources of a company to accomplish well ( Kim et al., 2017 ). CR is considered an impalpable, value resource by any firm. It serves as a crucial factor in determining the competitive benefit, particularly in a product where diversity is negligible in the consumer ( Arikan et al., 2016 ; Baudot et al., 2019 ).

According to Benitez et al. (2017) , consumers assess and appraise new services or products launched based on their existing image in the market. Moreover, an excellent CR provides a shield against adverse customer perspectives because CR results from its business activities. In contrast, CSR initiatives are considered the best profitable method to construct a good reputation and perception in consumers and stakeholders ( Lee et al., 2017 ; Lee, 2019 ). Thus, engaging in publicly accountable activities and contributing to the well-being of a society enhances the image and reputation of a company ( Gulzar et al., 2018 ). As per Melero-Polo and López-Pérez (2017) , the consumer perspective of CSR initiatives impacts affirmatively in building CR. Forcadell and Aracil (2017) endorse that suitable social activity of firms leads to increased CR. Previous studies also indicate that CSR positively correlates with a CR ( Brammer and Pavelin, 2016 ; Gardberg et al., 2019 ; Khan et al., 2020a ). Based on the above discussion, we proposed our first hypothesis:

H1. CSR positively influences CR

Corporate Social Responsibility and Brand Equity

The concept of BE has been argued in both accounting and marketing literature, and it has underlined the necessity of a long-term perspective in brand management ( Khan et al., 2020b ). Although businesses have made substantial efforts to manage brands strategically, there is still a lack of consistent terminology and philosophy inside and between disciplines, which can obstruct communication. Accountants and marketers have varied definitions of brand equity, with the idea being described both in terms of the customer-brand connection and as something that accrues to the brand owner. Organizations build BE for their products by making them distinctive, easily recognizable, and high-quality and reliable ( Yang and Basile, 2019 ; Yang et al., 2020 ).

Prior studies highlighted that BE has a positive relationship with CSR ( Abdolvand and Charsetad, 2013 ; Lin and Chung, 2019 ; Yang and Basile, 2019 ). BE was originated from the strong interaction between brands and consumers ( Martínez and Nishiyama, 2019 ). The more consumer expectations are met or exceeded, the more the BE ( Liu and Lu, 2019 ). Similarly, the ethical behavior of a firm will lead to its reputation and a crucial indicator of brand appraisal ( Beckmann, 2007 ). Thus, the study assumes that the customer perspective of CSR initiatives may positively impact brand equity. So, we proposed our second hypothesis:

H2. CSR positively influences BE

Corporate Social Responsibility and Trust

Business ties are held together by a social glue called trust. Business partners that trust each other spend less time and energy defending themselves from being exploited, and both sides achieve greater financial results in negotiations ( Farid et al., 2020 ). When your employees know that you trust them and that they can express themselves clearly, trust becomes vital in business. They will almost certainly be more driven to be productive and work to their best potential ( Park et al., 2014 ).

Looking into previous literature, we have provided concepts to understand the relationship between CSR and trust ( Pivato et al., 2008 ; Vlachos et al., 2009 ; Park et al., 2014 ). So, the results of these studies confirm that CSR has a positive and significant relationship with trust. Moreover, the image of an organization and its norms help establish trust in the company that can be derived from its socially responsible initiatives ( Azmat and Ha, 2013 ). Organizations that are perceived as publicly answerable by consumers are inclined to have high trust levels in the eyes of the consumers ( Cheung and Pok, 2019 ; Kim, 2019 ). Hence, our third hypothesis is presented below:

H3. CSR positively influences trust.

The Mediating Effects of the Trust

According to the study of Iglesias et al. (2018) , the benevolence base trust includes customer perception as either a firm honestly serious or concerned about the well-being and welfare of society. Similarly, another famous author, Arikan et al. (2016) indicated by the social trade hypothesis that a client trust in the direction of the firm image improves the social integration of the client association to build client responsibility toward the brand ( Nguyen and Pham, 2018 ; Kim, 2019 ; Zhao et al., 2019 ). The consumer does an overall assessment and evaluation of the image of the firm, which is drawn on their perception and information about the firm ( Joo et al., 2017 ), and trust is the forerunner to CR. Many previous studies also confirm in their results that trust is the mediator between CRS and CR and brand equity. Therefore, the literature suggests that trust is positively and significantly mediates between the CRS, CR, and brand equity. Figure 1 is presenting the conceptual model of this study. Thus, this research makes the following hypotheses:

Figure 1. Conceptual model. Solid lines show the direct relationship, and dashed lines show the indirect relationship.

H4. Trust mediates CSR and BE

H5. Trust mediates between CSR and CR

Research Methods

Research approach.

In this study, we used a questionnaire survey analysis approach. We used this approach because it is common and has a broad sample of the given population that can be contacted at a relatively low cost ( Roby et al., 2003 ; Heeringa et al., 2017 ; Wang et al., 2021 ). Hennessy and Patterson (2011) suggested that for the survey analysis, first, we should develop the research questionnaire ( Rasool et al., 2019a , b ). So, in this study, first, we designed the questionnaire to collect data.

Questionnaire Designing

This study aims to explore the influence of CSR, directly and indirectly, on CR and brand equity, using trust as a mediating variable. In this questionnaire, 17 items were used with a 5-point Likert-Scale (1 stands for “strongly disagree,” and five stands for “strongly agree”). The questionnaire is consists of five sections. The first section includes the demographic information of the respondents. The second section took insight of the customers about CSR activities. The third part of the questionnaire measured the respondent’s level of trust in the banking sector. The fourth part of the questionnaire explained the CR -related information, and the last and fifth sections encompassed acclaimed variables that measure BE dimensions. Before data collection, the authors also conducted a pilot study to check the reliability and validity of the questionnaire. The pilot study respondents suggested some modifications to the questionnaire. Therefore, the questionnaire was revised as per the recommended feedback from the pilot study respondents. So the revised questionnaire was distributed for data collection.

Variables Measurements

The items of CSR are adopted from López-González et al. (2019) . All items of CSR were measured with 5-points Likert-Scale (1 “strongly disagree” and 5 “strongly agree”). The alpha of CSR was 0.920. The results indicate that the factor loading of each item is more than the standard value (0.70). So in this study, measures were considered adequate. The factor loading of each item is mentioned in Table 1 .

Table 1. Construct reliability and validity.

The items of CR were adopted by Suki and Suki (2019) . All items related to CR were measured with a 5-point Likert-Scale (1 “strongly disagree” and 5 “strongly agree”). The alpha of CR was 0.920. The results indicate that the factor loading of each item is more than the standard value (0.70). So in this study, measures were considered adequate. The factor loading of each item is mentioned in Table 1 .

The items of BE are adopted from previous studies Çifci et al. (2016) . For the measurement of brand equity, we apply the 5-point Likert-Scale (1“strongly disagree” and 5 “strongly agree”). The alpha of BE was 0.917, which is appropriate. The results indicating that the factor loading of each item is more than the standard value (0.70). So, the alpha values met the threshold criteria. The factor loading of each item is mentioned in Table 1 .

We use to trust the items developed by Tzempelikos and Gounaris (2017) . All items were measured on a 5-points Likert-Scale (1“strongly disagree” and 5 “strongly agree”). The alpha of trust was 0.939, which is acceptable. The results indicate that the factor loading of each item is more than the standard value (0.70). So, the alpha values met the threshold criteria. The factor loading of each item is mentioned in Table 1 .

Data Collection

The data was collected using self-administered questionnaires from the consumers of banking sectors living in Lahore city, the capital of Punjab province of Pakistan. The banking sector consumers for this research refer to those people who are aged above 18 years and have an account in any bank during the survey. Data were collected between 2018 and 2019. This survey was conducted during the working hours of the banks. A non-probabilistic sampling technique with a combination of convenience sampling techniques was used for this research to measure demographic variables like respondent gender, qualification, age, and income. Above all, variables ensure that the sample signifies the sociodemographic features of the present population. At present, for this study, initially, a total of 550 survey instruments were circulated, and from these, 342 questionnaires were received and 23 castoffs due to incomplete information that leaves us with 319 responses. Also, 10 unusable ware responses were identified, leaving 309 responses for the final analysis of this research. The majority of respondents in this research were men, around 57.09%, and women 46.91% aged between 20 and 60 years. Most of the audience holds a bachelor’s degree 950 (16%) and belongs to middle-income families earning $200–690 monthly (43.89%). For more detailed analysis, all variables were inspected for data entry errors, missing values, and the fit between distributions using the software SmartPLS.

The relationships drawn in the conceptual model were examined using the SEM method. The rationale for choosing SEM over the covariance-based SEM approach is that it is less vulnerable to sample size.

The degree to which all of the multiple elements of the model are used to test its convergent validity ( Kura, 2017 ), shown in Table 2 . For this, the threshold value should be >0.6 ( Hair et al., 2016 ). Since all of our values met the threshold requirement, each data collection indicator is valid.

Table 2. Factor loading.

The degrees that display actuality or affirm convergent validity are referred to as average variance extracted (AVE) ( Ahmad S. et al., 2019 ). The AVE value should be larger than 0.5, according to Fornell and Larcker (1981) . The reliability of structures has been demonstrated using composite reliability and Cronbach’s alpha value. The stability of structures has been measured using composite reliability and Cronbach’s alpha value. According to Hair Jr. and Sarstedt, it should have a value larger than 0.7; many of the variables in our sample have values that are greater than or equal to the threshold value.

Discriminant validity demonstrates that objects and their constructs have distinct meanings ( Hair et al., 2016 ). Its value is higher than 0.6 in Table 3 , which represents valid results, while negative results indicate the reverse.

Table 3. Discriminant validity of constructs.

Cross loading is a technique for demonstrating that the loading value of the indicator is highest with one construct and lowest with another ( Hair et al., 2017 ). Table 4 reveals that the values of indicators are adequate for their construct but not for others.

Table 4. Cross loading.

The standardized root mean square residual (SRMR), which is based on converting both the sample covariance matrix and the predicted covariance matrix into correlation matrices, is a measure of the mean absolute value of the covariance residuals. The difference between the observed correlation and the model indicated correlation matrix is defined as the SRMR. As a result, it is possible to use the average size of the differences between observed and anticipated correlations as an absolute measure of (model) fit. A good fit is defined as a value <0.10 or 0.08 ( Hu and Bentler, 1998 ). The SRMR is a goodness of fit metric for PLS-SEM introduced by Henseler et al. (2014) that may be used to avoid model misspecification. The model is shown by values in Table 5 (0.068), which is less than the predefined threshold. So, the model is fitted.

Table 5. Model fit (standardized root means square residual).

R Square’s partial least square regression model shows us how much variation is explained by independent variables on the dependent variable and model strength. The goodness of fit of the model is shown in this analysis. It should have a value >0.3. The coefficient of determination (R square) values are >0.3, which is greater than the threshold value, indicating the goodness of the model in Table 6 .

Table 6. R square—R 2 .

Table 7 presents the value of CSR on CR as 3.161, which means acceptance of the H1 hypothesis because it forecasts that the CRS activities positively affect CR as this path that leads toward the CRS is significant statistically at 0.05 level. Thus, H1 confirms that socially responsible activities lead toward positive CR from the perspective of the consumer This finding also supports the previous studies on the subject where Nguyen and Nguyen (2017) stated that CSR positively correlates with CR. H2 suggested that CSR also has an affirmative effect on BE. The value of the direct impact of CSR on CR is 3.161, which is positive and supports H2. The findings are also aligned with the work of Marín et al. (2016) . H3 suggested that CSR activities and initiatives directly affect the trust of consumers in brand image. Its value that ultimately CSR has an effect on trust also shows the positive relationship with CRS, which supports H3. The hypothesis is found to be significant at the 0.05 level. H4 claims that trust plays a mediating role between CSR and CR, while H5 claims that trust plays a partial mediating role between CSR and BE. Both have a positive effect and significant values, which means acceptance of H4 and H5, respectively.

Table 7. Path model results (direct and indirect).

Figure 2 depicts the relationship between all variables and mediation results. The inner model shows the relationship between the variables, whereas the outer model shows the factor loading values for each indicator. The connection between CSR and CR is 3.161, which means that the one-unit increase of CSR will positively impact CR by 3.161 points. By a 100% increase in CSR activities, it will increase CR by 316.1%. Similarly, CSR and BE connection values are 2.502, which also shows strong and positive relationships and that a one-unit increase in CSR initiatives will increase the BE of the company by 2.502 points. The mediating effect of trust shows that the mediating effect of Trust on CSR and CR as a consumer has a positive impact. Similarly, Figure 2 demonstrates the mediating impact of trust on the positive and robust relationship between CSR and BE.

Figure 2. Theoretical constructs with R2 values.

The aim of this study was to investigate how CSR, directly and indirectly, influences CR and BE, using trust as a mediating variable. Previously, such studies were conducted in developed countries, such as the United States, United Kingdom, and other western countries. However, a limited amount of findings are argued and their findings are presented on emerging countries like Pakistan. So, the limited studies on the emerging countries have still shown the scarcity of findings from the banking sector perspective. Authors believe that financial institutions ought to identify their significant roles in the socio-economic development of any country. To the best of the knowledge of the author, this research is among the earliest research paradigms to investigate the impact of CSR on CR and BE in the Pakistani organizational context, especially by considering trust as a mediating variable. So, the exploration of this study is the role of trust as a mediating instrument. CSR activities help in the cumulative status of a corporate organization amongst its customers, employees, and stakeholders.

First, we focused on the direct relationship between CSR and CR and BE. The results show that CSR has a positive and significant impact on CR and BE, supporting our hypotheses H1 and H2. Prior studies have shown that CSR has a positive relationship with CR and BE ( Hsu, 2012 ; Fatma et al., 2015 ; Lin and Chung, 2019 ; Lu et al., 2019 ). The finding of Hur et al. (2018) also support our results. They express in their study that CSR is known to be a standout amongst the best methods for promotion. There is just restricted research contemplating the impacts of CSR on advertising results. Therefore, this research indicates that CSR enhances CR and BE in the banking sector of Pakistan. Similarly, the RBV supports our study in the relationship between CRS, CR, and BE. Moreover, Rea et al. (2014) also suggest in their research that RBV supports the direct relationship among CSR, CR, and BE.

Second, this study depicts the positive and direct effects of CRS on trust, which supports Hypothesis 3. The finding of this study supports the research conducted by Choi and La (2013) , which concludes that CSR significantly influences customer trust. Similarly, Park et al. (2014) examine the relationship between CSR and customer trust in Korean organizations, and the outcomes of their study confirmed that CSR is directly connected with customer trust. Thus, CRS has positively influenced customer trust in the banking sector of Pakistan. So, in case Pakistani banks want to create a positive image in the minds of their customers, they should focus on the CSR of the society that will affect the trust of the customer on their products.

Third, in this study, we test the mediated effect of trust between CSR, CR, and BE. It also translates significant results, which is a novel and original contribution in emerging countries like Pakistan, which supports H4 and H5. The mediated results support the findings of previous studies ( Pivato et al., 2008 ; Fatma et al., 2015 ; Jalilvand et al., 2017 ). Forcadell and Aracil (2017) and Vlachos et al. (2009) inspected the mediating role of consumer satisfaction and trust among CSR and CR; however, they confirm in their study that trust is positively and significantly mediated between the CSR and CR. Further, Chang and Yeh (2017) proposed in their study that CSR has a positive relationship with BE using trust as a mediating variable. The outcomes of their study confirm that trust is intervening between CSR and brand equity. So, the outcomes of this research also indicated that customer trust as a critical variable positively affects CRS, CR, and BE. These results have significant inferences for PSBs in particular and private banks in Pakistan and advise that CSR activities may help in Constructing CR and BE.

The results of this study confirmed the linkages among CSR, CR, and BE in the banking sector of Pakistan. Moreover, the finding of this research indicates that in the direct relationship, CSR positively influences CR and brand equity. The outcome of this study also confirms that trust positively and significantly mediates between CSR, CR, and brand equity. Furthermore, the outcomes confirmed that CSR has a positive and significant relationship with CR and brand equity.

This study highlight that the PSBs spend their resources on CSR activities to lead to significant advantages for partners and society. While participating in CSR exercises, PSBs will gain a progressively positive discernment and a reasonable frame of mind of their partners and stakeholders. Along with the fruitful insights, it is more important for banking and other industries to invest in the CSR interventions that can contribute to gain sustainable competitive advantage. Similarly, the investment in CSR is also fruitful for both stakeholders and the community. The exact outcomes of the examination show that CSR has an immediate positive and circuitous impact on CR and BE because findings here reveal that CSR indirectly influences CR as mediated by trust. Furthermore, discoveries uncover that the backhanded effects of CSR exercise on CR while mediated by trust. The multifaceted CSR demonstrated as a CR and BE are more viable explanations behind CSR exercises. Then again, buyer trust might be seen as a result of firms captivating CSR exercises. The solid connection between CSR activities and CR proves that an organization occupied with socially dependable exercises can anticipate different helpful results.

Implications, Limitations, and Future Research Directions

Managerial implication.

This research was conducted in the banking sector of Pakistan. The findings indicate some practical implications for the banking sector of Pakistan that could increase the organizational CR and BE through CSR. First, the managers need to create an environment of CSR activities. Those planning to do while establishing and maintaining strong relationships with firms and consumers through these CSR activities are more likely to create positive outcomes such as BE and CR ( Javeed and Lefen, 2019 ). Second, managers, specifically in banking organizations should pay more attention to CSR activities and spend more of their resources on these activities. In this way, customers perceive the firm as more socially responsible and trustworthy than any other firm while considering it more favorably. This study shows that the results in a well-known or good reputation will increase brand equity. Third, the banking organizations and other investment-related companies also pay more close attention to their reputation in the minds of the consumers because it plays a critical role in evaluating the performance of the firm. Therefore, the banking organizations and investment-related firms should expect to enhance their brand while considering various socially responsible initiatives that positively impact society. The finding provides the most important insights to firm managers about their critical position in developing CSR as a customer brand partnership from their marketing viewpoints. They can take more effort to maintain deep trust between customers because it has been found that most consumers view a firm as more trustworthy when it is associated with some social problem.

Limitation and Future Research Direction

This research has some limitations that may affect the generalization of its findings. First, due to time constraints and scared resources, the nature of our study was cross-sectional instead of a longitudinal design. Therefore, we recommend future researchers conduct a longitudinal mode study using CSR predictors on industrial BE and CR for more generalized results. Second, the data is collected from the second biggest city of Pakistan, an expensive city in Pakistan, affecting the buyers buying power. Such research will conduct in four to five different cities of the country, which will have generalized the study results. Third, the data was collected from the banking sector, which might cause common method bias. As the job nature of the target population is different from each other, future studies should focus on individuals who have similar jobs. In the future, such kind of study will explore the relationship between CSR and CR using the well-being of the customer as a mediating variable.

Data Availability Statement

The original contributions presented in the study are included in the article/supplementary material, further inquiries can be directed to the corresponding authors.

Author Contributions

MS and MA conceived the idea of the study. SR worked on the research methodology and helped in drafting the manuscript. MM worked on the results and analysis, and interpretation of model results. TO supervised the project and intensively edited the language of the manuscript. YZ approved and read the final manuscript and participated in the critical appraisal of the manuscript. All authors contributed to the article and approved the submitted version.

This study was financially supported by the National Natural Science Foundation of China (Grant No. 71673179).

Conflict of Interest

The authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

Publisher’s Note

All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article, or claim that may be made by its manufacturer, is not guaranteed or endorsed by the publisher.

Abbas, J., Mahmood, S., Ali, H., Ali Raza, M., Ali, G., Aman, J., et al. (2019). The effects of corporate social responsibility practices and environmental factors through a moderating role of social media marketing on sustainable performance of business firms. Sustainability 11:3434. doi: 10.3390/su11123434

CrossRef Full Text | Google Scholar

Abdolvand, M., and Charsetad, P. (2013). Corporate social responsibility and brand equity in industrial marketing. Int. J. Acad. Res. Bus. Soc. Sci. 3:273. doi: 10.6007/IJARBSS/v3-i9/208

Ahmad, I., Shahzad, K., and Gul, A. (2019). Mediating role of customer satisfaction between corporate social responsibility and customer-based brand equity. Bus. Econ. Rev. 11, 123–144. doi: 10.22547/BER/11.1.6

Ahmad, S., Hussain, A., and Batool, A. (2019). Path analysis of genuine leadership and job life of teachers. J. Educ. Sci. 6, 1–14.

Google Scholar

Arikan, E., Kantur, D., Maden, C., and Telci, E. E. (2016). Investigating the mediating role of corporate reputation on the relationship between corporate social responsibility and multiple stakeholder outcomes. Qual. Quant. 50, 129–149. doi: 10.1007/s11135-014-0141-5

Arshed, N., Ahmad, W., Munir, M., and Farooqi, A. (2021). Estimation of national stress index using socioeconomic antecedents–a case of MIMIC model. Psychol. Health Med. Online ahead of print. doi: 10.1080/13548506.2021.1903051

PubMed Abstract | CrossRef Full Text | Google Scholar

Azmat, F., and Ha, H. (2013). Corporate social responsibility, customer trust, and loyalty—perspectives from a developing country. Thunderbird Int. Bus. Rev. 55, 253–270. doi: 10.1002/tie.21542

Baudot, L., Johnson, J. A., Roberts, A., and Roberts, R. W. (2019). Is corporate tax aggressiveness a reputation threat? corporate accountability, corporate social responsibility, and corporate tax behavior. J. Bus. Ethics 163, 197–215. doi: 10.1007/s10551-019-04227-3

Beckmann, S. C. (2007). Consumers and corporate social responsibility: matching the unmatchable? Australas. Mark. J. 15, 27–36. doi: 10.1016/S1441-3582(07)70026-5

Benitez, J., Ruiz, L., Llorens, J., and Castillo, A. (2017). “Corporate social responsibility, employer reputation, and social media capability: an empirical investigation,” in Proceedings of the 25th European Conference on Information Systems (ECIS) (Guimarães).

Brammer, S. J., and Pavelin, S. (2016). “Corporate reputation and corporate social responsibility,” in A Handbook of Corporate Governance and Social Responsibility , eds P. G. Aras and P. D. Crowther (Famham: Gower Publishing).

Branco, M. C., and Rodrigues, L. L. (2006). Corporate social responsibility and resource-based perspectives. J. Bus. Ethics 69, 111–132. doi: 10.1007/s10551-006-9071-z

Castelo Branco, M., and Lima Rodrigues, L. (2006). Communication of corporate social responsibility by Portuguese banks: a legitimacy theory perspective. Corp. Commun. Int. J. 11, 232–248. doi: 10.1108/13563280610680821

Chang, H.-H. (2017). Consumer socially sustainable consumption: the perspective toward corporate social responsibility, perceived value, and brand loyalty. J. Econ. Manag. 13, 167–191.

Chang, Y.-H., and Yeh, C.-H. (2017). Corporate social responsibility and customer loyalty in intercity bus services. Transport Policy 59, 38–45. doi: 10.1016/j.tranpol.2017.07.001

Cheung, A. W., and Pok, W. C. (2019). Corporate social responsibility and provision of trade credit. J. Contemporary Account. Econ. 2019:100159. doi: 10.1016/j.jcae.2019.100159

Choi, B., and La, S. (2013). The impact of corporate social responsibility (CSR) and customer trust on the restoration of loyalty after service failure and recovery. J. Serv. Mark. 27, 223–233. doi: 10.1108/08876041311330717

Çifci, S., Ekinci, Y., Whyatt, G., Japutra, A., Molinillo, S., and Siala, H. (2016). A cross validation of consumer-based brand equity models: driving customer equity in retail brands. J. Bus. Res. 69, 3740–3747. doi: 10.1016/j.jbusres.2015.12.066

Crane, A., McWilliams, A., Matten, D., Moon, J., and Siegel, D. S. (2008). “The corporate social responsibility agenda,” in The Oxford Handbook of Corporate Social Responsibility , eds A. McWilliams, D. E. Rupp, and D. S. Seigel (Oxford: Oxford University Press). doi: 10.1093/oxfordhb/9780199211593.003.0001

Edinger-Schons, L. M., Lengler-Graiff, L., Scheidler, S., and Wieseke, J. (2019). Frontline employees as corporate social responsibility (CSR) ambassadors: a quasi-field experiment. J. Bus. Ethics 157, 359–373. doi: 10.1007/s10551-018-3790-9

Farid, T., Iqbal, S., Khan, A., Ma, J., Khattak, A., Naseer, et al. (2020). The impact of authentic leadership on organizational citizenship behaviors: the mediating role of affective-and cognitive-based trust. Front. Psychol. 11:1975. doi: 10.3389/fpsyg.2020.01975

Farid, T., Iqbal, S., Ma, J., Castro-González, S., Khattak, A., and Khan, M. K. (2019). Employees’ perceptions of CSR, work engagement, and organizational citizenship behavior: the mediating effects of organizational justice. Int. J. Environ. Res. Public Health 16:1731. doi: 10.3390/ijerph16101731

Fatma, M., Rahman, Z., and Khan, I. (2015). Building company reputation and brand equity through CSR: the mediating role of trust. Int. J. Bank Mark. 33, 840–856. doi: 10.1108/IJBM-11-2014-0166

Forcadell, F. J., and Aracil, E. (2017). European banks’ reputation for corporate social responsibility. Corp. Soc. Responsib. Environ. Manag. 24, 1–14. doi: 10.1002/csr.1402

Fornell, C., and Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. J. Mark. Res. 18, 39–50. doi: 10.1177/002224378101800104

Gardberg, N. A., Zyglidopoulos, S. C., Symeou, P. C., and Schepers, D. H. (2019). The impact of corporate philanthropy on reputation for corporate social performance. Bus. Soc. 58, 1177–1208. doi: 10.1177/0007650317694856

Ghaderi, Z., Mirzapour, M., Henderson, J. C., and Richardson, S. (2019). Corporate social responsibility and hotel performance: a view from Tehran, Iran. Tour. Manag. Perspect. 29, 41–47. doi: 10.1016/j.tmp.2018.10.007

Gotsi, M., and Wilson, A. M. (2001). Corporate reputation: seeking a definition. Corp. Commun. Int. J. 6, 24–30. doi: 10.1108/13563280110381189

Gulzar, M., Cherian, J., Sial, M., Badulescu, A., Thu, P., Badulescu, D., et al. (2018). Does corporate social responsibility influence corporate tax avoidance of chinese listed companies? Sustainability 10:4549. doi: 10.3390/su10124549

Hair, J. F., Hult, G. T. M., Ringle, C., and Sarstedt, M. (2016). A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM). Thousand Oaks, CA: Sage publications.

Hair, J. F., Sarstedt, M., Ringle, C. M., and Gudergan, S. P. (2017). Advanced Issues in Partial Least Squares Structural Equation Modeling. Thousand Oaks, CA: Sage Publications. doi: 10.1007/978-3-319-05542-8_15-1

Hameed, K., Arshed, N., Yazdani, N., and Munir, M. (2021). Motivating business towards innovation: a panel data study using dynamic capability framework. Technol. Soc. 65:101581. doi: 10.1016/j.techsoc.2021.101581

Heeringa, S. G., West, B. T., and Berglund, P. A. (2017). Applied Survey Data Analysis. London: Chapman and Hall.

Hennessy, J. L., and Patterson, D. A. (2011). Computer Architecture: a Quantitative Approach. Amsterdam: Elsevier.

Henseler, J., Dijkstra, T. K., Sarstedt, M., Ringle, C. M., Diamantopoulos, A., Straub, D. W., et al. (2014). Common beliefs and reality about PLS: comments on Rönkkö and Evermann (2013). Organ. Res. Methods 17, 182–209. doi: 10.1177/1094428114526928

Hoang, H. T., Wang, F., Van Ngo, Q., and Chen, M. (2019). Brand equity in social media-based brand community. Mark. Intelligence Plann. 38, 325–339. doi: 10.1108/MIP-01-2019-0051

Hsu, K.-T. (2012). The advertising effects of corporate social responsibility on corporate reputation and brand equity: evidence from the life insurance industry in Taiwan. J. Bus. Ethics 109, 189–201. doi: 10.1007/s10551-011-1118-0

Hu, L.-T., and Bentler, P. M. (1998). Fit indices in covariance structure modeling: sensitivity to underparameterized model misspecification. Psychol. Methods 3, 424–453. doi: 10.1037/1082-989X.3.4.424

Hur, W. M., Kim, H., and Kim, H. K. (2018). Does customer engagement in corporate social responsibility initiatives lead to customer citizenship behaviour? the mediating roles of customer-company identification and affective commitment. Corp. Soc. Responsib Environ. Manag. 25, 1258–1269. doi: 10.1002/csr.1636

Iglesias, O., Markovic, S., Bagherzadeh, M., and Singh, J. J. (2018). Co-creation: a key link between corporate social responsibility, customer trust, and customer loyalty. J. Bus. Ethics 163, 151–166. doi: 10.1007/s10551-018-4015-y

Jalilvand, M. R., Nasrolahi Vosta, L., Kazemi Mahyari, H., and Khazaei Pool, J. (2017). Social responsibility influence on customer trust in hotels: mediating effects of reputation and word-of-mouth. Tour. Rev. 72, 1–14. doi: 10.1108/TR-09-2016-0037

Javeed, S., and Lefen, L. (2019). An analysis of corporate social responsibility and firm performance with moderating effects of CEO power and ownership structure: a case study of the manufacturing sector of Pakistan. Sustainability 11:248. doi: 10.3390/su11010248

Jeffrey, S., Rosenberg, S., and McCabe, B. (2019). Corporate social responsibility behaviors and corporate reputation. Soc. Responsib. J. 15, 395–408. doi: 10.1108/SRJ-11-2017-0255

Joo, J., Eom, M., and Shin, M. (2017). Finding the missing link between corporate social responsibility and firm competitiveness through social capital: a business ecosystem perspective. Sustainability 9:707. doi: 10.3390/su9050707

Khan, T. M., Bai, G., Fareed, Z., Quresh, S., Khalid, Z., and Khan, W. A. (2020a). CEO tenure, CEO compensation, corporate social & environmental performance in China. The moderating role of coastal and non-coastal areas. Front. Psychol. 11:3815.

Khan, T. M., Gang, B., Fareed, Z., and Yasmeen, R. (2020b). The impact of CEO tenure on corporate social and environmental performance: an emerging country’s analysis. Environ. Sci. Pollut. Res. 27.

Kim, H. L., Rhou, Y., Uysal, M., and Kwon, N. (2017). An examination of the links between corporate social responsibility (CSR) and its internal consequences. Int. J. Hospital. Manag. 61, 26–34. doi: 10.1016/j.ijhm.2016.10.011

Kim, S. (2019). The process model of corporate social responsibility (CSR) communication: CSR communication and its relationship with consumers’ CSR knowledge, trust, and corporate reputation perception. J. Bus. Ethics 154, 1143–1159. doi: 10.1007/s10551-017-3433-6

Kura, K. M. (2017). Theorizing a boundary condition of the relationship between human resource management practices and turnover intention: a proposed model. J. Innov. Sustainab. 8, 3–11. doi: 10.24212/2179-3565.2017v8i1p3-11

Lai, C.-S., Chiu, C.-J., Yang, C.-F., and Pai, D.-C. (2010). The effects of corporate social responsibility on brand performance: the mediating effect of industrial brand equity and corporate reputation. J. Bus. Ethics 95, 457–469. doi: 10.1007/s10551-010-0433-1

Lee, C.-Y. (2019). Does corporate social responsibility influence customer loyalty in the Taiwan insurance sector? the role of corporate image and customer satisfaction. J. Promotion Manag. 25, 43–64. doi: 10.1080/10496491.2018.1427651

Lee, J., Kim, S.-J., and Kwon, I. (2017). Corporate social responsibility as a strategic means to attract foreign investment: evidence from Korea. Sustainability 9:2121. doi: 10.3390/su9112121

Lin, M. S., and Chung, Y. K. (2019). Understanding the impacts of corporate social responsibility and brand attributes on brand equity in the restaurant industry. Tour. Econ. 25, 639–658. doi: 10.1177/1354816618813619

Liu, M., and Lu, W. (2019). Corporate social responsibility, firm performance, and firm risk: the role of firm reputation. Asia Pacific J. Account. Econ. 27, 2991–3005. doi: 10.1080/16081625.2019.1601022

López-González, E., Martínez-Ferrero, J., and García-Meca, E. (2019). Corporate social responsibility in family firms: a contingency approach. J. Clean. Prod. 211, 1044–1064. doi: 10.1016/j.jclepro.2018.11.251

Lu, J., Ren, L., He, Y., Lin, W., and Streimikis, J. (2019). Linking corporate social responsibility with reputation and brand of the firm. Amfiteatru Econ. 21, 442–460.

Luo, X., and Bhattacharya, C. B. (2006). Corporate social responsibility, customer satisfaction, and market value. J. Market. 70, 1–18. doi: 10.1509/jmkg.70.4.1

Marín, L., Cuestas, P. J., and Román, S. (2016). Determinants of consumer attributions of corporate social responsibility. J. Bus. Ethics 138, 247–260. doi: 10.1007/s10551-015-2578-4

Martínez, P., and Nishiyama, N. (2019). Enhancing customer-based brand equity through CSR in the hospitality sector. Int. J. Hosp. Tour. Administration 20, 329–353. doi: 10.1080/15256480.2017.1397581

Melero-Polo, I., and López-Pérez, M. E. (2017). Identifying links between corporate social responsibility and reputation: some considerations for family firms. J. Evol. Stud. Bus. 2, 191–230.

Newburry, W., Deephouse, D. L., and Gardberg, N. A. (2019). “Global aspects of reputation and strategic management,” in Global Aspects of Reputation and Strategic Management , eds D. Deephouse, N. Gardberg, and W. Newburry (Bingley: Emerald Publishing Limited). doi: 10.1108/S1064-4857201918

Nguyen, H. N., and Pham, L. X. (2018). The relationship between country-of-origin image, corporate reputation, corporate social responsibility, trust and customers’ purchase intention: evidence from vietnam. J. Appl. Econ. Sci. 13, 498–509.

Nguyen, T. D., and Nguyen, V. T. (2017). “Promoting organizational commitment and organizational citizenship behaviors in vietnamese enterprises: the influence of corporate reputation,” in Paper Presented at the The 4th International Conference on Finance and Economics (Vietnam).

Park, J., Lee, H., and Kim, C. (2014). Corporate social responsibilities, consumer trust and corporate reputation: South Korean consumers’ perspectives. J. Bus. Res. 67, 295–302. doi: 10.1016/j.jbusres.2013.05.016

Pivato, S., Misani, N., and Tencati, A. (2008). The impact of corporate social responsibility on consumer trust: the case of organic food. Bus. Ethics Eur. Rev. 17, 3–12. doi: 10.1111/j.1467-8608.2008.00515.x

Raji, R. A., Mohd Rashid, S., and Mohd Ishak, S. (2019). Consumer-based brand equity (CBBE) and the role of social media communications: qualitative findings from the Malaysian automotive industry. J. Mark. Commun. 25, 511–534. doi: 10.1080/13527266.2018.1455066

Rasool, S. F., Maqbool, R., Samma, M., Zhao, Y., and Anjum, A. (2019a). Positioning depression as a critical factor in creating a toxic workplace environment for diminishing worker productivity. Sustainability 11:2589. doi: 10.3390/su11092589

Rasool, S. F., Samma, M., Wang, M., Zhao, Y., and Zhang, Y. (2019b). How human resource management practices translate into sustainable organizational performance: the mediating role of product, process and knowledge innovation. Psychol. Res. Behav. Manag. 12, 1009–1025. doi: 10.2147/PRBM.S204662

Rea, B. J., Wang, Y., and Stoner, J. (2014). When a brand caught fire: the role of brand equity in product-harm crisis. J. Product Brand Manag. 23, 532–542. doi: 10.1108/JPBM-01-2014-0477

Rettab, B., and Mellahi, K. (2019). “CSR and corporate performance with special reference to the middle east,” in Practising CSR in the Middle East , eds B. Rettab and K. Mellahi (Berlin: Springer), 101–118. doi: 10.1007/978-3-030-02044-6_6

Roby, D. D., Lyons, D. E., Craig, D. P., Collis, K., and Visser, G. H. (2003). Quantifying the effect of predators on endangered species using a bioenergetics approach: caspian terns and juvenile salmonids in the Columbia River estuary. Can. J. Zool. 81, 250–265. doi: 10.1139/z02-242

Shin, Y., and Thai, V. V. (2015). The impact of corporate social responsibility on customer satisfaction, relationship maintenance and loyalty in the shipping industry. Corp. Soc. Responsib. Environ. Manag. 22, 381–392. doi: 10.1002/csr.1352

Smith, N. C. (2003). Corporate social responsibility: not whether, but how. California Manag. Rev. 45, 52–76. doi: 10.2307/41166188

Suki, N. M., and Suki, N. M. (2019). “Correlations between awareness of green marketing, corporate social responsibility, product image, corporate reputation, and consumer purchase intention,” in Corporate Social Responsibility: Concepts, Methodologies, Tools, and Applications , eds Management Association and Information Resources (Pennsylvania: IGI Global), 143–154. doi: 10.4018/978-1-5225-6192-7.ch008

Tzempelikos, N., and Gounaris, S. (2017). “A conceptual and empirical examination of key account management orientation and its implications–the role of trust,” in The Customer is NOT Always Right? Marketing Orientationsin a Dynamic Business World , ed C. L. Campbell Berlin: Springer. doi: 10.1007/978-3-319-50008-9_185

Vlachos, P. A., Tsamakos, A., Vrechopoulos, A. P., and Avramidis, P. K. (2009). Corporate social responsibility: attributions, loyalty, and the mediating role of trust. J. Acad. Mark. Sci. 37, 170–180. doi: 10.1007/s11747-008-0117-x

Wang, B., Rasool, S. F., Zhao, Y., Samma, M., and Iqbal, J. (2021). Investigating the nexus between critical success factors, despotic leadership, and success of renewable energy projects. Environ. Sci. Pollut. Res. Online ahead of print. doi: 10.1007/s11356-021-16441-6

Yang, J., and Basile, K. (2019). The impact of corporate social responsibility on brand equity. Mark. Intelligence Planning 37, 2–17. doi: 10.1108/MIP-02-2018-0051

Yang, J., Basile, K., and Letourneau, O. (2020). The impact of social media platform selection on effectively communicating about corporate social responsibility. J. Market. Comm. 26, 65–87.

Zhao, Z., Meng, F., He, Y., and Gu, Z. (2019). the influence of corporate social responsibility on competitive advantage with multiple mediations from social capital and dynamic capabilities. Sustainability 11:218. doi: 10.3390/su11010218

Zhou, X., Rasool, S. F., Yang, J., and Asghar, M. Z. (2021). Exploring the relationship between despotic leadership and job satisfaction: the role of self efficacy and leader–member exchange. Int. J. Environ. Res. Public Health 18:5307. doi: 10.3390/ijerph18105307

Zia, M. A., Abbas, R. Z., and Arshed, N. (2021). Money laundering and terror financing: issues and challenges in Pakistan. J. Money Laundering Control Online ahead of print. doi: 10.1108/JMLC-11-2020-0126

Keywords : corporate social responsibility (C.S.R.), trust, corporate reputation behavior, brand equity, social perception

Citation: Zhao Y, Abbas M, Samma M, Ozkut T, Munir M and Rasool SF (2021) Exploring the Relationship Between Corporate Social Responsibility, Trust, Corporate Reputation, and Brand Equity. Front. Psychol. 12:766422. doi: 10.3389/fpsyg.2021.766422

Received: 29 August 2021; Accepted: 01 October 2021; Published: 10 November 2021.

Reviewed by:

Copyright © 2021 Zhao, Abbas, Samma, Ozkut, Munir and Rasool. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY) . The use, distribution or reproduction in other forums is permitted, provided the original author(s) and the copyright owner(s) are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

*Correspondence: Madeeha Samma, [email protected] ; Samma Faiz Rasool, [email protected]

Disclaimer: All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article or claim that may be made by its manufacturer is not guaranteed or endorsed by the publisher.

CSR Reputation and Firm Performance: A Dynamic Approach

• Original Paper
• Published: 08 November 2018
• Volume 163 , pages 619–636, ( 2020 )

Cite this article

• Stewart R. Miller 1 ,
• Lorraine Eden 2 &

9257 Accesses

105 Citations

2 Altmetric

Explore all metrics

Many countries have regulations that require firms to engage in minimum levels of corporate social (CS) activities in areas such as the environment and social welfare. In this paper, we argue that changes in a firm’s compliance with CS regulations are reflected in its reputation for corporate social responsibility (CSR), which affects the firm’s performance. The performance impacts depend on whether the firm’s CSR reputation in the current and prior periods is positive (i.e., the firm exceeds CS regulations), neutral (the firm meets CS regulations), or negative (the firm fails to comply with CS regulations). Our theoretical framework draws on the reputation literature and on the concepts of recency bias, which weights the present more heavily than the past, and negativity bias, which weights negative assessments more heavily than neutral or positive assessments. We test our hypotheses on a sample of 7317 banks over 1992–2007 where we compare a bank’s return on assets (ROA) with its current and prior compliance ratings under the U.S. Community Reinvestment Act. We find that changes in CSR reputation have predictable, asymmetric, and sizeable impacts on firm performance. For example, for an average bank with $1 billion in assets, gaining a positive CSR reputation translates into a rise in profits of 4.04%; gaining a negative CSR reputation results in a drop in profits of − 7.8%.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price includes VAT (Russian Federation)

Instant access to the full article PDF.

Rent this article via DeepDyve

Institutional subscriptions

Similar content being viewed by others

The impact of four types of corporate social performance on reputation and financial performance.

The Impact of Corporate Reputation Ratings on CEO Compensation Under Diverse Economic Conditions

Does CSR reputation mitigate the impact of corporate social irresponsibility?

http://www.macleans.ca/work/bestcompanies/top-50-socially-responsible-corporations-2014/ .

http://www.frontstream.com/the-most-socially-responsible-companies-of-2015-part-one/ .

http://www.forbes.com/pictures/efkk45fdekj/the-10-companies-with-the-best-csr-reputations-2/#2dfda10377ae .

We acknowledge that the actions that result in gaining a positive CSR reputation may be driven by altruism or other motives. At no point do we attempting to distinguish the actual motives of corporate leaders, which are difficult to observe, if not virtually impossible to distinguish. Rather, we focus on a firm’s observable investment in corporate social activities and institutional actors’ perceptions of the focal firm’s actions.

We acknowledge prior studies of autobiographical memory reveal evidence of a fading effect bias, in which people more quickly forget negative experiences than positive ones (Ritchie et al. 2006 ), this effect is unlikely in a professional setting with high task complexity.

Note we do not compare movements toward a neutral CSR reputation (that is, compliance with CS regulations) because we hypothesize in both cases (H1a and H2b) that the impact should be nonsignificant.

We therefore do not consider the case where a firm spends so far in excess of CS regulations that evaluators and stakeholders view its behavior as unsafe and unsound. In such a case, the firm would be socially responsive but its excessive behavior would have a negative reputation effect.

There are two noncompliant categories, “Needs to improve” and “Substantial noncompliance.” The second was issued so rarely that we combined them into the “Noncompliant” category.

https://www.fdic.gov/regulations/resources/director/presentations/cra.pdf .

Setting α (the probability of Type I error) and β (the probability of Type II error) equal to .05 means that the probability of our not finding a significant effect when it is actually present is equal to the probability of incorrectly rejecting the null.

Goldman-Carter ( 1992 ) discussed diluted regulations with respect to a different CSR domain – environmental protection.

Amel, D., & Rhoades, S. (1988). Strategic groups in banking. Review of Economics and Statistics, 70 , 685–689.

Article   Google Scholar  

Arlow, P., & Gannon, M. (1982). Social responsiveness, corporate structure, and economic performance. Academy of Management Review, 7 (2), 235–241.

Arnold, V., Collier, P., Leech, S., & Sutton, S. (2000). The effect of experience and complexity on order and recency bias in decision making by professional accountants. Accounting and Finance, 40 , 109–134.

Balmer, J. M. T. (2010). The BP Deepwater Horizon debacle and corporate brand exuberance. Journal of Brand Management, 18 , 97–104.

Barnett, M., & Salomon, R. (2006). Beyond dichotomy: The curvilinear relationship between social responsibility and financial performance. Strategic Management Journal, 27 , 1101–1122.

Barnett, W., Greve, H., & Park, D. (1994). An evolutionary model of organizational performance. Strategic Management Journal, 15 , 11–28.

Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17 , 99–120.

Barsade, S., Koput, K., & Staw, B. (1997). Escalation at the credit window: A longitudinal study of bank executives’ recognition and write-off of problem loans. Journal of Applied Psychology, 82 , 130–142.

Berle, A. (1932). For whom corporate managers are trustees: A note. Harvard Law Review, 45 , 1365–1372.

Bitektine, A. (2011). Toward a theory of social judgments of organizations: The case of legitimacy, reputation, and status. Academy of Management Review, 53 , 151–178.

Bitektine, A., & Haack, P. (2015). The “macro” and the “micro” of legitimacy: Toward a multilevel theory of the legitimacy process. Academy of Management Review, 40 , 49–75.

Bonin, J., Hasan, I., & Wachtel, P. (2005). Bank performance, efficiency and ownership in transition countries. Journal of Banking and Finance, 29 , 31–53.

Bosse, D., Phillips, R., & Harrison, J. (2009). Stakeholders, reciprocity, and firm performance. Strategic Management Journal, 30 , 447–456.

Bradford, C. S. (2004). Does size matter? An economic analysis of small business exemptions from regulation . Nebraska:University of Nebraska, College of Law, Faculty Publications.

Google Scholar  

Brammer, S., & Millington, A. (2008). Does it pay to be different? An analysis of the relationship between corporate social and financial performance. Strategic Management Journal, 29 , 1325–1343.

Brammer, S., & Pavelin, S. (2006). Corporate reputation and social performance: The importance of fit. Journal of Management Studies, 43 , 435–455.

Campbell, J., Eden, L., & Miller, S. R. (2012). Multinationals and corporate social responsibility in host countries: Does distance matter? Journal of International Business Studies, 43 , 84–106.

Catino, M., & Patriotta, G. (2013). Learning from errors: Cognition, emotions and safety culture in the Italian Air Force. Organization Studies, 34 , 437–467.

Certo, S. T., & Semadeni, M. (2006). Strategy research and panel data: Evidence and implications. Journal of Management, 32 , 449–471.

Chen, Z., & Lurie, N. (2013). Temporal contiguity and negativity bias in the impact of online word of mouth. Journal of Marketing Research, 50 , 463–476.

Cohen, J. (1990). Things I have learned (so far). American Psychologist, 45 , 1304–1312.

Cohen, J. (1992). A power primer. Psychological Bulletin, 112 , 155–159.

Cohen, J., & Cohen, P. (1983). Applied multiple regression/correlation analysis for the behavioral sciences . Erlbaum: Hillsdale, NJ.

Day, D. (2001). Assessment of leadership outcomes. In S. Zaccaro & R. Klimoski (Eds.), The nature of organizational leadership (pp. 384–410). San Francisco: Jossey-Bass.

Deephouse, D., Bundy, J., Tost, L. P., & Suchman, M. (2017). Organizational legitimacy: Six key questions. In R. Greenwood, C. Oliver, T. Lawrence & R. Meyer (Eds.), The SAGE handbook of organizational institutionalism (2nd edn., pp. 27–54). Oxford: Sage.

Chapter   Google Scholar  

Deephouse, D., & Carter, S. (2005). An examination of differences between organizational legitimacy and organizational reputation. Journal of Management Studies, 42 , 329–360.

Dietz, J., Pugh, S., & Wiley, J. (2004). Service climate effects on customer attitudes: An examination of boundary conditions. Academy of Management Journal, 47 , 81–92.

Dodd, E. (1932). For whom corporate managers are trustees? Harvard Law Review, 45 , 1145–1163.

Doh, J., & Guay, T. (2006). Corporate social responsibility, public policy, and NGO activism in Europe and the United States: An institutional-stakeholder perspective. Journal of Management Studies, 43 , 47–73.

Doh, J., Howton, S., Howton, S., & Siegel, D. (2010). Does the market respond to an endorsement of social responsibility? The role of institutions, information and legitimacy. Journal of Management, 23 , 1461–1485.

Eden, L., & Miller, S. R. (2004). Distance Matters: Liability of foreignness, institutional distance and ownership strategy. In M. Hitt & J. Cheng (Eds.), The evolving theory of the multinational firm. Advances in International Management . Amsterdam: Elsevier.

Elayan, F., Li, H., Liu, Z., Meyer, T., & Felton, A. (2016). Changes in the covalence ethical code, financial performance and financial reporting quality. Journal of Business Ethics, 134 , 369–395.

Federal Reserve Board. (2008). Community reinvestment act. http://www.federalreserve.gov/dcca /cra/ .

Fombrun, C. (1996). Reputation: Realizing value from the corporate image . Boston: Harvard Business School Press.

Fombrun, C., & Shanley, M. (1990). What’s in a name? Reputation building and corporate strategy. Academy of Management Journal, 33 , 233–258.

Gates, C., & Villanueva, M. (2014). Community Reinvestment Act: Developing a strategy for success. Consumer Compliance Outlook, third quarter.

Goldman-Carter, J. (1992). Wetlands classification: A tool for protection or abandonment? Duke University Environmental Law & Policy Forum , 94–105.

Hambrick, D., & Mason, P. (1984). Upper echelons: The organization as a reflection of its top managers. Academy of Management Review, 9 , 193–206.

Hastie, R., & Dawes, R. (2001). Rational choice in an uncertain world: The psychology of judgment and decision making . Thousand Oaks: Sage.

Heider, F. (1958). The psychology of interpersonal relationships . New York: Wiley.

Book   Google Scholar  

Hogarth, R., & Einhorn, H. (1992). Order effects in belief updating: The belief-adjustment model. Cognitive Psychology, 24 , 1–55.

Jeong, K.-H., Jeong, S.-W., Kee, W.-J., & Bae, S.-H. (2018). Permanency of CSR activities and firm value. Journal of Business Ethics, 152 , 207–223.

Jo, H., & Kim, Y. (2008). Ethics and disclosure: A study of the financial performance of firms in the seasoned equity offerings market. Journal of Business Ethics, 80 , 855–878.

Johnson, S., & Sarkar, S. (1996). The valuation effects of the 1977 Community Reinvestment Act and its enforcement. Journal of Banking & Finance, 20 , 783–803.

Kelley, H. (1973). The processes of causal attribution. American Psychologist, 28 , 107–128.

Kennedy, J. (1993). Debiasing audit judgment with accountability: A framework and experimental results. Journal of Accounting Research, 31 , 231–245.

Kim, J.-Y., & Miner, A. (2007). Vicarious learning from the failures and near-failures of others: Evidence from the U.S. commercial banking industry. Academy of Management Journal, 50 , 687–714.

King, B., & Whetten, D. (2008). Rethinking the relationship between reputation and legitimacy: A social actor conceptualization. Corporate Reputation Review, 11 , 192–207.

Lange, D., & Lee, P. (2011). Organizational reputation: A review. Journal of Management, 37 , 153–184.

Lee, D. (2017). Corporate social responsibility and management forecast accuracy. Journal of Business Ethics, 140 , 353–367.

Love, E., & Kraatz, M. (2009). Character, conformity, or the bottom line? How and why downsizing affected corporate reputation. Academy of Management Journal, 52 , 314–335.

Lupfer, M., Weeks, M., & Dupuis, S. (2000). How pervasive is the negativity bias in judgments based on character appraisal? Personality and Social Psychology Bulletin, 26 , 1353–1366.

Madsen, P., & Desai, V. (2010). Failing to learn? The effects of failure and success on organizational learning in the global orbital launch vehicle industry. Academy of Management Journal, 53 , 451–476.

McWilliams, A., & Siegel, D. (2000). Corporate social responsibility and financial performance: Correlation or misspecification? Strategic Management Journal, 21 , 603–609.

McWilliams, A., & Siegel, D. (2001). Corporate social responsibility: A theory of the firm perspective. Academy of Management Review, 26 , 117–127.

McWilliams, A., Siegel, D., & Wright, P. (2006). Corporate social responsibility. Journal of Management Studies 43 , 1–18.

Mehra, A. (1996). Resource and market-based determinants of performance in the U.S. banking industry. Strategic Management Journal, 17 , 307–322.

Messier, W., & Tubbs, R. (1994). Recency effects in belief revision: The impact of audit experience and the review process. Auditing: A Journal of Practice & Theory, 13 , 57–72.

Miller, S. R., & Eden, L. (2006). Local density and foreign subsidiary performance. Academy of Management Journal, 49 , 341–355.

Miller, S. R., & Parkhe, A. (2002). Is there a liability of foreignness in global banking? An empirical test of banks’ x-efficiency. Strategic Management Journal, 23 , 55–75.

Neter, J., Wasserman, W., & Kutner, M. (1990). Applied linear statistical models Chicago: Irwin.

Nofsinger, J., & Varma, A. (2013). Availability, recency, and sophistication in the repurchasing behavior of retail investors. Journal of Banking & Finance, 37 , 2572–2585.

O’Daniel, A. (2014). Bank of America hit with downgraded Community Reinvestment Act rating. Charlotte Business Journal , November 14.

Orlitzky, M., Schmidt, F., & Rynes, S. (2003). Corporate social and financial performance: A meta-analysis. Organization Studies, 24 , 403–441.

Pfarrer, M., Pollock, T., & Rindova, V. (2010). A tale of two assets: The effects of firm reputation and celebrity on earnings surprises and investors’ reaction. Academy of Management Journal, 53 , 1131–1152.

Rao, H. (1994). The social construction of reputation: Certification contests, legitimization and the survival of organizations in the American automobile industry. Strategic Management Journal, 15 , 29–44.

Reason, J. (1990). Human error . Cambridge: Cambridge University Press.

Rhee, M., & Haunschild, P. R. (2006). The liability of good reputation: A study of product recalls in the US automotive industry. Organization Science, 17.1 , 101–107.

Rhee, M., & Valdez, M. (2009). Contextual factors surrounding reputation damage with potential implications for reputation repair. Academy of Management Review, 34 , 146–168.

Rindova, V., Williamson, I., Petkova, A., & Sever, J. (2005). Being good or being known: An empirical examination of the dimensions, antecedents, and consequences of organizational reputation. Academy of Management Journal, 48 , 1033–1049.

Ritchie, T., Skowronski, J., Wood, S., Walker, W., Vogl, R., & Gibbons, J. (2006). Event self-importance, event rehearsal, and the fading effect bias in autobiographical memory. Self and Identity, 5 , 172–195.

Roberts, P., & Dowling, G. (2002). Corporate reputation and sustained superior financial performance. Strategic Management Journal, 23 , 1077–1093.

Rozin, P., & Royzman, E. (2001). Negativity bias, negativity dominance and contagion. Personality and Social Psychology Review, 5 , 296–320.

Simpson, W. G., & Kohers, T. (2002). The link between corporate social and financial performance: Evidence from the banking industry. Journal of Business Ethics, 35 , 97–102.

Strategic implications. Journal of Management Studies , 43, 1–18.

Taylor, J., & Silver, J. (2009). The Community Reinvestment Act: 30 years of wealth building and what we must do to finish the job. In P. Chakrabarti, D. Erickson, R. Essene, I. Galloway & J. Olson (Eds.), Revisiting the CRA: Perspectives on the future of the Community Reinvestment Act . Boston: Federal Reserve Banks of Boston and San Francisco).

Terlaak, A. (2007). Order without law? The role of certified management standards in shaping socially desired firm behaviors. Academy of Management Review, 32 , 968–985.

Vitaliano, D., & Stella, G. (2006). The cost of corporate social responsibility: The case of the Community Reinvestment Act. Journal of Productivity Analysis, 26 , 235–244.

Wang, H., Choi, J., & Li, J. (2008). Too little or too much? Untangling the relationship between corporate philanthropy and firm financial performance. Organization Science, 19 , 143–159.

Wei, Z., Shen, H., Zhou, K., & Li, J. (2017). How does environmental corporate social responsibility matter in a dysfunctional institutional environment? Evidence from China. Journal of Business Ethics, 140 , 209–223.

Weigelt, K., & Camerer, C. (1988). Reputation and corporate strategy: A review of recent theory and applications. Strategic Management Journal, 9 , 443–454.

Wu, Z., & Salomon, R. (2016). Does imitation reduce the liability of foreignness? Linking distance, isomorphism, and performance.’. Strategic Management Journal, 37 , 2441–2462.

Zaheer, S. (1995). Overcoming the liability of foreignness. Academy of Management Journal, 38 , 341–363.

Zavyalova, A., Pfarrer, M., Reger, R., & Hubbard, T. (2016). Reputation as a benefit and a burden? How stakeholders’ organizational identification affects the role of reputation following a negative event. Academy of Management Journal, 59 , 253–276.

Download references

Acknowledgements

An earlier version of this paper was presented at the annual meetings of the Academy of Management. We thank Joanna Tochman Campbell for her research assistance, and the editors and anonymous reviewers at the Journal of Business Ethics for their helpful comments, while retaining the responsibility for any errors or omissions.

Author information

Authors and affiliations.

College of Business, University of Texas at San Antonio, San Antonio, TX, 78249, USA

Stewart R. Miller

Mays Business School, Texas A&M University, College Station, TX, 77843-4221, USA

Lorraine Eden

Kelley School of Business, Indiana University, Bloomington, IN, 47405, USA

You can also search for this author in PubMed   Google Scholar

Corresponding author

Correspondence to Lorraine Eden .

Ethics declarations

Conflict of interest.

Stewart R. Miller, Lorraine Edenand Dan Li declares that they have no conflict of interest.

Electronic supplementary material

Below is the link to the electronic supplementary material.

Supplementary material 1 (DOCX 13 KB)

Rights and permissions.

Reprints and permissions

About this article

Miller, S.R., Eden, L. & Li, D. CSR Reputation and Firm Performance: A Dynamic Approach. J Bus Ethics 163 , 619–636 (2020). https://doi.org/10.1007/s10551-018-4057-1

Download citation

Received : 03 March 2017

Accepted : 28 October 2018

Published : 08 November 2018

Issue Date : May 2020

DOI : https://doi.org/10.1007/s10551-018-4057-1

Share this article

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative

• Corporate social responsibility
• Banking sector
• Firm performance
• Recency bias
• Negativity bias
• Find a journal
• Publish with us
• Track your research

Corporate social responsibility and financial performance – the role of corporate reputation, advertising and competition

PSU Research Review

ISSN : 2399-1747

Article publication date: 26 April 2022

The research on corporate social responsibility (CSR) and firm performance (FP) has seen a surge over the years. However, the role of corporate reputation (CR), advertising strategy and market competition is still unclear. The purpose of this study is to consider this gap and test an integrative model of CSR-FP, in the context of India.

Design/methodology/approach

The data for CSR expenditure were collected from the annual reports of the selected companies. CR was captured using the ranks of Fortune India 500, Business Standard 1,000 and Economic Times 500. The financial data were collected from CMIE (Prowess) database.

Results of structural equation modeling (SEM) revealed a significant relationship between CSR expenditure of the firm and its reputation; but no relationship between CR and performance. When CR increases, the performance of a firm may not improve. Competitive intensity (CI) had no statistically significant role in the CR-FP relationship for performance. Results suggest that reputed firms perform well despite high competition within an industry. High reputation is effective in improving performance irrespective of competition. CI has a positive impact in the reputation–performance linkage. Advertising intensity (AI) played a significant moderating role in the CSR intensity and CR relationship.

Originality/value

This research represents an added value for the literature on CSR by highlighting the importance of CR, advertising strategy and market competition in the relationship between CSR and FP. The findings have several implications for theory and practice, which have been discussed in the study.

• Corporate social responsibility
• Corporate reputation
• Advertising
• Competition
• Financial performance

Bashir, M. (2022), "Corporate social responsibility and financial performance – the role of corporate reputation, advertising and competition", PSU Research Review , Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/PRR-10-2021-0059

Emerald Publishing Limited

Copyright © 2022, Makhmoor Bashir

Published in PSU Research Review . Published by Emerald Publishing Limited. This article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this licence may be seen at http://creativecommons.org/licences/by/4.0/legalcode

1. Introduction

The role of business in society has undergone sea changes over the past few decades. The role of business is no more confined to making profits but also giving back a part of such profits to society. Corporate social responsibility (CSR) is the organization's efforts to enhance the socioeconomic welfare over and above its profit-making motives and a socially responsible firm catering to the best interests of all its stakeholders prospers in the long run ( Pradhan, 2016 ). The concept of responsible business is a global phenomenon, and CSR is now a buzzword both in academia and in the business world. Firms are socially involved for very different reasons: to meet stakeholder demands; to gain appreciation, positive image and reputation; differentiation, etc ( Pradhan, 2016 ; Sen et al. , 2006 ; Maignan and Ferrell, 2001 ). Irrespective of the reasons, CSR has been evidenced to help increase the profitability of a firm and can be considered as an investment.

There are a plethora of studies that have studied the relationship between CSR and firm performance (FP) ( AL-Shammari et al ., 2021 ; Otto et al ., 2020 ; Zhou and Ki, 2018 ). Despite extensive research on the CSR-FP relationship, there is high ambiguity in the nature of the relationship ( Aupperle et al. , 1985 ). Some research has highlighted that the relationship is positive, and effective CSR can give firms a competitive advantage ( Bernal-Conesa et al. , 2017 ; Farooq et al ., 2017 ), whereas others argue that the agency cost incurred by CSR has the potential to damage performance ( Ting and Yin, 2018 ; Barauskaite and Streimikiene, 2021 ). This leads one to question other factors that may play a role in the relationship. Some scholars believe in a direct linkage in CSR-FP, while others stress an indirect relationship ( Hsu, 2012a , b ; Lai et al. , 2010a , b ). Previous empirical studies on CSR have tried to find a relationship between CSR and profitability ( Quéré et al. , 2018 ; Aupperle et al. , 1985 ) but did not address potential consequences of CSR, such as corporate image ( Hoeffler and Keller, 2002 ), customer perceptions ( Pradhan, 2018 ); corporate reputation (CR) ( Hsu, 2012a , b ), customer satisfaction ( Hsu, 2012a , b ), etc. that may affect the performance of a firm indirectly. Therefore, this study has attempted to fill this gap in the CSR-FP relationship.

This study makes several contributions to the research on CSR and FP relationship. First, we contribute to the existing empirical research on CSR and FP ( Al-Shammari et al ., 2021 ; Otto et al ., 2020 ; Zhou and Ki, 2018 ; Pradhan, 2016 ). We broaden the scope of CSR research, which has mainly focussed on the link between CSR-FP. Second, there are other factors, like advertising strategy and competitiveness of the market, that can influence the relationship as well ( Pradhan, 2016 ; Neville et al. , 2005 ). The same phenomenon has been observed in the context of emerging economies as well. In India, factors such as the government, nongovernment organizations (NGOs) and social activists ( Pradhan, 2016 , 2018 ; Mishra and Suar, 2010 ) influence CSR. Third, we have studied CSR in the Indian context. The majority of the CSR studies have been conducted in the context of developed nations. This study has been conducted in the Indian context due to its uniqueness in the country. CSR attracted the attention of managers in India post ( Companies Bill, 2013 ), which mandated firms to invest 2% of their net profits (NPs) in social activities. Therefore, this study looks into India as the subject of its study. This study analyses the role of CR, competition and advertising in influencing the profitability of firms involved in CSR.

The paper is structured as follows: we begin by providing an introduction and motivation behind conducting this study. The second section deals with a review of literature and hypothesis development followed by a proposed theoretical model. The fourth section discusses the process used to analyze data using structural equation modeling (SEM). The fifth section provides the results and discussion. The sixth and final section provides the theoretical and managerial implications and concludes after providing the limitations and future scope of research.

2. Literature review and hypothesis development

The literature provides expansive studies on CSR but fails to provide any unified definition of the concept. As per Moir (2001 , p. 17), CSR considers numerous issues, such as marketplace (customers and suppliers), human rights, employees, community, corporate ethics and environment. Businesses contribute optimally to society when they are efficient, profitable and philanthropic. The concept captures the economic, social and environmental motives of an organization while being a good corporate citizen ( Lee et al. , 2009 ). Firms that are profitable can easily engage in social activities as compared to their less profitable counterparts. Generally, larger entities that are widely known to the public tend to perform CSR activities and inform about such activities publicly. This provides a firm with benefits, like improved brand image, innovation, efficiency, CR ( Schwaiger, 2004 ) and customer and employee satisfaction. Consumers tend to believe that responsible firms provide superior quality products ( Maignan and Ferrell, 2001 ). Potential employees are attracted to such firms as CSR is an indication of organizational attractiveness. Existing employees tend to identify themselves with firms ( Aaker, 1994 ) subsequently creating superior value for the firm (customer loyalty, positive word-of-mouth, etc.) ( Sen et al. , 2006 ; Hoeffler and Keller, 2002 ).

2.1 CSR intensity and corporate reputation (CR)

CSR intensity has a positive effect on CR.

2.2 Corporate reputation and firm performance

CR has a positive impact on the performance of a firm.

2.3 CSR and competitive intensity (CI)

CI has a moderating role in the relationship between CR and a firm's performance.

2.4 The moderating role of advertising intensity (AI) in the CSR-FP relationship

Advertising intensity (AI) of a firm moderates the relationship between CSR and CR.

AI of a firm moderates the relationship between CR and financial performance.

2.4.1 Proposed Model

The reputation of a firm is created in the short run, but is formed and could change over a period of time. Thus, the bond between CSR, CR and FP is a continuous process. Based on the above literature and hypotheses formed, we propose a model ( Figure 1 ) and test it empirically.

3. Methodology

3.1 variables.

CSR i ntensity : We use the term CSR intensity here which is the extent to which a firm uses its current year's profits in CSR activities in the following year (as used by Pradhan, 2016 ). CSR intensity is measured as the ratio of a firm's expenditure on CSR over the operating profits of the previous year (as suggested by Paton and Williams, 1999 ; Pradhan, 2016 ). CSR expenditure takes place only when there are profits in the previous year, so the lag was taken.

Corporate r eputation : Studies analyzing CR and CSR in the US context have used data available by the Fortune 500 list ( Dutton and Dukerich, 1991 ; Zadek et al. , 1997 ). To analyze firms in the Indian context, we used ranks provided by Indian ranking agencies, such as Fortune India 500, ET 500 and Business Today 500. To achieve accuracy, a standardized reputation rank was created going for a nonlinear principal component analysis amongst the rankings provided by Fortune India 500, ET 500 and Business Today 500. This resulted in an objective score.

Advertising i ntensity was measured by the ratio of advertising expenditure of a firm over operating expenditure ( Paton and Williams, 1999 ). Endogeneity was removed by using a one-year lag (as followed by Paton and Williams, 1999 ; Pradhan, 2016 ). The advertising expenditure was standardized to remove any existing industry effects.

Competitive i ntensity was captured using the Herfindahl–Hirschman Index (HHI) (used by Ho et al ., 2012 ; Jo and Harjoto, 2012 ). It is a numerical measure of concentration calculated by taking the squares of market shares of all firms and then adding the squares. The formula for HHI, which is used in this study, is as follows: ∑ i = 1 n   ( M S i ) 2 .

Financial p erformance was measured using ROCE, NP ratio and market-to-book ratio. The final sample was collected from across 36 industries as classified by the CMIE (Prowess) database.

3.2 Data sources

The study focussed on a neutral third-party perspective rather than the managerial or customer perspective commonly used in CSR studies. To remove bias, published audited data were used for the analysis. CSR Expenditure (2019) – the data for CSR expenditure were collected from the annual reports of the selected companies. Corporate Reputation (2020) – the data for CR were captured using the ranks of Fortune India 500, Business Standard 1,000, and Economic Times 500. Financial Data (2017–2020) – the financial data were collected from CMIE (Prowess) database. To remove the effect of any anomalies and portray the true picture of the business, the average value of three years was used (as suggested by Rajan and Zingales, 1995 ).

4. Data analysis

4.1 industry identification.

The industries were classified into 47 groups as per the Fortune India 500 list. The industries finally used for analysis were as follows: airlines, auto, auto ancillaries, basic materials, spirits, capital goods, cement, coal, consumer durables, diversified, pharmaceuticals, construction, fertilizers, fast-moving consumer goods (FMCG), agriproducts, jewelry, hotels and restaurants, infrastructure development, iron and steel, leather, lubricants, metals and mining, drilling services, oil and gas, packaging, paper, plastic products, power, real estate, retail, ship building, shipping services, storage batteries, sugar, tea and coffee, telecommunication, textiles and garments, and tyres and tubes.

4.2 Data analysis and results

SEM was used for data analysis. Before testing hypotheses, common method variance was assessed. Path analysis using SEM was run to find the influence of CSR intensity on CR and FP measured by NP, price-to-book ratio (PBR) and ROCE. The moderating effect of advertising intensity and competition was also tested using the framework.

4.2.1 Confirmatory factor analysis

We checked the model fit indices using Amos 23. Taking a cue from the suggestions of Hair et al. (2010) , we used only three model fit indices (i.e. χ 2 /df, CFI and RMSEA) to avoid redundancy. The results suggested a satisfactory model fit (i.e. χ 2 /df = 2.60, CFI = 0.927 and RMSEA = 0.056) ( Hair et al. , 2010 ). Next, the convergent validity of the measures was established by measuring the average variance extracted (AVE) of all the factors in the measurement model. The AVEs of all the constructs were greater than 0.50, which provides ample evidence of convergent validity ( Fornell and Lacker, 1981 ). Furthermore, discriminant validity was established by comparing the MSV with the AVE of each construct ( Table 1 ). MSV values for each construct were lower than the AVE values, which gives evidence about discriminant validity ( Fornell and Lacker, 1981 ).

4.3 Hypotheses testing

As the model fit indices of the framework were found to be satisfactory, it was statistically relevant to test the hypotheses proposed in the framework. The results of the hypothesis testing for all the three dependent variables of the study have been presented in Table 2 .

There was evidence of a statistically significant relationship between CSR expenditure of the firm and its reputation (CR) ( β  = 8.1; p  = 0.02) when analyzed using NP as the dependent variable. So, high expenditure on CSR activities results in higher CR. The findings are similar to several past studies ( Lai et al. , 2010a , b ; Hsu, 2012a , b ; Khan et al. , 2021 ; Ullah et al. , 2020 ), which came up with a positive relation between CSR and CR. Keeping PBR as the dependent variable, it was observed that there was a significant relationship between CSR and CR ( β  = 8.1; p  = 0.02). ROCE as the dependent variable came up with similar results ( β  = 8.1; p  = 0.02). These three sets of analyses revealed that high CSR expenditure tends to improve its CR. So, we accept H1 .

Results reveal a positive but statistically insignificant relationship between CR and FP. When CR increases, the performance of a firm tends to improve. The relationship between CR and PBR is higher ( β  = 0.09; p  = 0.34) compared to CR and ROCE ( β  = 0.06; p  = 0.5) and CR and NP ( β  = 0.01; p  = 0.68). Though the results suggest a positive relationship, we cannot conclude that an increase in CR of a firm, performance (measured in terms of PBR, ROCE and NP) tends to improve. This is analogous to findings by Wood and Jones (1995) , Clarkson (1995) , Roberts and Dowling (2002) , Pradhan (2016) . This study failed to find a statistically significant relationship between CR and performance. One can argue that reputation is built over years, and the effect of such reputation may be witnessed over a period of time, not instantly. So, we do not find enough evidence to accept H2 . CI had no statistically significant role in the CR-FP relationship for any of the three measures of performance (NP – β  = 0.01; p  = 0.46; PBR – β  = 0.02; p  = 0.9; ROCE – β  = −0.06; p  = 0.68). Results suggest that reputed firms perform well despite high competition within an industry. A high reputation is thus effective in improving performance irrespective of competition. Though insignificant, CI plays a positive role in the reputation–performance linkage. Reputed firms have the added advantage of being differentiated and reputation, hence decreasing the effect of competition on the firm.

AI was found to have a significant moderating role in the CSR intensity and CR relationship ( β  = 8.9; p  = ***) in the model using NPs, PBR as well as ROCE. Firms that spend large amounts on advertising have better chances of improved reputation (as found by Park (2017) , Greening and Gray (1994) , Shimp (1997) , Bromley (2000) , Roberts and Dowling (2002) . Hence, investing in advertising has positive benefits as far as reputation is concerned. The study however failed to find any significant effect of advertising in the CR–performance linkage (NP – β  = 0.01; p  = 0.85; PBR – β  = 0.15; p  = 0.33; ROCE – β  = 0.03; p  = 0.87). This fails to conform to prior studies that have established that advertising improves the performance of a firm ( Chauvin and Hirschey, 1994 ; Conchar et al ., 2005 ). Though advertising improves the reputation of a firm, it fails to improve the performance of such highly reputed firms. This can be justified by arguing that highly reputed firms perform well on their own and need no CSR advertisement to boost their sales or performance. So, reputed firms fail to make any profits by advertising.

6. Discussion and conclusion

This study tried to address the burgeoning role of CSR in the Indian context. Globalization brought in several legislations, stakeholder groups and customers who had a different set of expectations and demands. This was one of the major reasons why Indian firms shifted their stance from passive philanthropy to active involvement. The amended legislation, i.e. The ( Companies Bill, 2013 ) was another milestone and a central force that mandated Indian firms to spend on CSR (if they met the criteria). From a strategic viewpoint, one can argue that companies should now reconsider their CSR spending to earn sustained growth. Despite its significance, CSR studies focusing on image, reputation, etc. in the Indian context, are few (e.g. O'Connor and Assaker, 2022 ; Aparna and Amilan, 2022 ; Bihari and Pradhan, 2011 ; Pradhan, 2016 ). CSR has its potential benefits. It helps a firm in differentiating itself, improving its image and reputation, employee satisfaction and motivation ( Schwaiger, 2004 ). It plays a role in improving credibility amongst its significant stakeholders ( Pradhan, 2016 , 2018 ). The three sets of analyses provided interesting insights. Intuitively, one can say that high spending on CSR helps in improving its reputation, and the findings confirm the same. So, from a practitioner's perspective, firms can confidently spend on CSR activities for higher reputation and consequent benefits. The study failed to find any significant impact of CR on performance. The literature, however, suggests that improved reputation is a source of sustained competitive advantage ( Porter, 1980 , Porter and Kramer, 2006 ; Pradhan, 2016 ). Advertising also plays a major role in improving the reputation of a firm. The results suggested that communicating social activities tends to improve the reputation of a firm. Competition has no significant impact on performance as highly reputed firms tend to make profits despite the high CI.

6.1 Theoretical implications

The study has several theoretical contributions. First, this is one of the few studies that has linked CSR with CR and FP. Most of the studies conducted have studied the direct impact of CSR on other variables. This study contributes to the existing body of literature by proposing an exhaustive model capturing several variables. Customers across industries have a varied set of expectations from firms in terms of their social responsibility. This affects CR and consequently financial performance. This seemingly simple relationship is augmented in the presence of competition and advertising. Second, this study tries to generalize the model by addressing the role of CSR across several industries in the Indian context. Third, this study was conducted a few years after the Companies Act 2013 was implemented. During this time, a lot of Indian firms started spending actively in CSR to fulfill the regulatory requirements. This study contributes to the existing body of literature by looking at the impact of CSR on performance, post the legislation. As per the knowledge of the author, there are very few studies that have made efforts to do so.

6.2 Managerial implications

In terms of managerial contributions, the study certainly provides significant observations for practitioners. Firms spend highly on CSR activities to improve their reputation and make sustained profits. It is therefore imperative to understand reputation intrinsically to develop strategies to affect stakeholder perceptions of the firm. The study also looked into the significance of advertising in managing reputation and found that CSR communication does positively affect their reputation. So firms should invest in CSR wisely and communicate it to relevant stakeholders. Managers need to decide amongst issues whether to look into stakeholder demands and whether to publicize their socially responsible efforts. Probing into these issues would provide an insight to managers on the significance of CSR on reputation and profitability. The findings of this study have a strategic implication as firms need to reconsider CSR spending for sustainability.

6.3 Limitations and future scope of the study

This study has few limitations that persevere in studies using reported data. Data were collected from 36 industries (as listed in Prowess), as we accounted for firms that were in the Fortune India 500 and the other ranks considered. This led to the exclusion of data from a lot of firms. As we considered highly reputed firms for this study, there are chances that they are less likely to be affected by other factors, such as competition, advertising, etc. Including firms that are not included in any lists may give different results altogether. An industry-wise analysis would help managers from that particular industry significantly to look into the issue and provide them with alternatives. A qualitative approach may be used to gain other insights and explain a certain phenomenon that cannot be captured empirically. So, future studies can be conducted on these lines. As reputation takes a long time to grow, a longitudinal study would provide interesting insights.

Proposed model

Composite reliability (CR), average variance extracted (AVE) and maximum shared variance (MSV)

Results of hypothesis testing

Aaker , D. ( 1994 ), “ Building a brand: the saturn story ”, California Management Review , Vol.  36 No.  2 , pp.  114 - 121 .

Aboud , A. and Diab , A. ( 2018 ), “ The impact of social, environmental and corporate governance disclosures on firm value: evidence from Egypt ”, Journal of Accounting in Emerging Economies , Vol.  8 No.  4 , pp.  442 - 458 .

Ajayi , O.A. and Mmutle , T. ( 2021 ), “ Corporate reputation through strategic communication of corporate social responsibility ”, Corporate Communications: An International Journal , Vol.  26 No.  5 , pp.  1 - 15 .

Al-Shammari , M.A. , Banerjee , S.N. and Rasheed , A.A. ( 2021 ), “ Corporate social responsibility and firm performance: a theory of dual responsibility ”, Management Decision , Vol. ahead-of-print No. ahead-of-print , doi: 10.1108/MD-12-2020-1584 .

Ang , S.H. ( 2008 ), “ Competitive Intensity and Collaboration: impact on firm growth across technological environments ”, Strategic Management Journal , Vol.  29 , pp.  1057 - 1075 .

Aparna , K. and Amilan , S. ( 2022 ), “ Customers' response to mandatory corporate social responsibility in India: an empirical evidence ”, Social Responsibility Journal , Vol. ahead- of-print No. ahead-of-print , doi: 10.1108/SRJ-04-2021-0174 .

Aupperle , K.E. , Carroll , A.B. and Hatfield , J.D. ( 1985 ), “ An empirical examination of the relationship between corporate social responsibility and profitability ”, Academy of Management Review , Vol.  28 No.  2 , pp.  446 - 463 .

Aziz , S. , Rahman , M. , Hussain , D. and Nguyen , D.K. ( 2021 ), “ Does corporate environmentalism affect corporate insolvency risk? the role of market power and competitive intensity ”, Ecological Economics , Vol.  189 , p. 107182 .

Barauskaite , G. and Streimikiene , D. ( 2021 ), “ Corporate social responsibility and financial performance of companies: the puzzle of concepts, definitions and assessment methods ”, Corporate Social Responsibility and Environmental Management , Vol.  28 No.  1 , pp.  278 - 287 .

Barnett , W.P. ( 1997 ), “ The dynamics of competitive intensity ”, Administrative Science Quarterly , Vol.  42 , pp.  128 - 160 .

Bernal-Conesa , J.A. , de Nieves Nieto , C. and Briones-Peñalver , A.J. ( 2017 ), “ CSR strategy in technology companies: its influence on performance, competitiveness and sustainability ”, Corporate Social Responsibility and Environmental Management , Vol.  24 No.  2 , pp.  96 - 107 .

Bihari , S.C. and Pradhan , S. ( 2011 ), “ CSR and performance: the story of banks in India ”, Journal of Transnational Management , Vol.  16 No.  1 , pp.  20 - 35 .

Bromley , D.B. ( 2000 ), “ Psychological aspects of corporate identity, image and reputation ”, Corporate Reputation Review , Vol.  3 No.  3 , pp.  240 - 252 .

Chauvin , K.W. and Hirschey , M. ( 1994 ), “ Goodwill, profitability, and the market value of the firm? ”, Journal of Accounting and Public Policy , Vol.  13 No.  2 , pp.  159 - 180 .

Chuah , S. , Hui-Wen , S. , Rasoolimanesh , M. , Cheng-Xi Aw , E. and Tseng , M. ( 2022 ), “ Lord, please save me from my sins! can CSR mitigate the negative impacts of sharing economy on consumer trust and corporate reputation? ”, Tourism Management Perspectives , Vol.  41 , p. 100938 .

Chun , R. ( 2005 ), “ Corporate reputation: meaning and measurement ”, International Journal of Management Reviews , Vol.  7 No.  2 , pp.  91 - 109 .

Clarkson , M.B.E. ( 1995 ), “ A stakeholder framework for analyzing and evaluating corporate social performance ”, The Academy of Management Review , Vol.  20 No.  1 , pp.  92 - 117 .

Conchar , M.P. , Crask , M.R. and Zinkhan , G.M. ( 2005 ), “ Market valuation models of the effect of advertising and promotional spending: a review and meta-analysis ”, Journal of the Academy of Marketing Science , Vol.  33 No.  4 , pp.  445 - 460 .

Dai , W. and Reich , A.Z. ( 2022 ), “ The differential impact of monological and dialogical corporate social responsibility communication strategies on brand trust in the credence goods market ”, Asia Pacific Journal of Marketing and Logistics , Vol. ahead-of-print No. ahead-of-print , doi: 10.1108/APJML-08-2021-0583 .

Dalla-Pria , L. and Rodríguez-de-Dios , I. ( 2022 ), “ CSR communication on social media: the impact of source and framing on message credibility, corporate reputation and WOM ”, Corporate Communications: an International Journal , Vol. ahead-of-print No. ahead-of-print , doi: 10.1108/CCIJ-09-2021-0097 .

Davies , G. and Miles , L. ( 1998 ), “ Reputation management: theory versus practice ”, Corporate Reputation Review , Vol.  2 No.  1 , pp.  16 - 27 .

Du , S. , Bhattacharya , C.B. and Sen , S. ( 2010 ), “ Maximizing business returns to corporate social responsibility (CSR): the role of CSR communication ”, International Journal of Management Reviews , Vol.  12 No.  1 , pp.  8 - 18 .

Dupire , M. and M'Zali , B. ( 2018 ), “ CSR strategies in response to competitive pressures ”, Journal of Business Ethics , Vol.  148 , pp.  603 - 623 .

Dutton , J. and Dukerich , J. ( 1991 ), “ Keeping an eye on the mirror: image and identity in organizational adaptation ”, Academy of Management Journal , Vol.  34 No.  3 , pp.  517 - 554 .

El Ghoul , S. , Guedhami , O. , Kwok , C. and Mishra , D. ( 2011 ), “ Does corporate social responsibility affect the cost of capital? ”, Journal of Banking and Finance , Vol.  35 No.  9 , pp.  2388 - 2406 .

Farooq , O. , Rupp , D.E. and Farooq , M. ( 2017 ), “ The multiple pathways through which internal and external corporate social responsibility influence organizational identification and multifoci outcomes: the moderating role of cultural and social orientations ”, Academy of Management Journal , Vol.  60 No.  3 , pp.  954 - 985 .

Fombrun , C. ( 1996 ), Reputation: Realizing Value from the Corporate Image , Harvard Business School Press , Boston, MA .

Fornell , C. and Larcker , D.F. ( 1981 ), “ Evaluating structural equation models with unobservable variables and measurement error ”, Journal of Marketing Research , Vol.  18 No.  1 , pp.  39 - 50 .

Foroudi , P. ( 2019 ), “ Influence of brand signature, brand awareness, brand attitude, brand reputation on hotel industry's brand performance ”, International Journal of Hospitality Management , Vol.  76 No.  2 , pp.  71 - 285 .

Fourati , Y.M. and Dammak , M. ( 2021 ), “ Corporate social responsibility and financial performance: international evidence of the mediating role of reputation ”, Corporate Social Responsibility and Environmental Management , Vol.  28 No.  6 , pp.  1749 - 1759 .

Greening , D.W. and Gray , B. ( 1994 ), “ Testing a model of organizational response to social and political issues ”, Academy of Management Journal , Vol.  37 No.  3 , pp.  467 - 498 .

Hair , J.F. , Ortinau , D.J. and Harrison , D.E. ( 2010 ), Essentials of Marketing Research , Vol.  2 , McGraw-Hill/Irwin , New York, NY .

Ho , F.N. , Wang , H.M.D. and Vitell , S.J. ( 2012 ), “ A global analysis of corporate social performance: the effects of cultural and geographic environments ”, Journal of Business Ethics , Vol.  107 No.  4 , pp.  423 - 433 .

Hoeffler , S. and Keller , K.L. ( 2002 ), “ Building brand equity through corporate societal marketing ”, Journal of Public Policy and Marketing , Vol.  21 No.  1 , pp.  78 - 89 .

Hsu , K. ( 2012a ), “ The advertising effects of corporate social responsibility on corporate reputation and brand equity: evidence from the life insurance industry in Taiwan ”, Journal of Business Ethics , Vol.  109 No.  2 , pp.  189 - 201 .

Hsu , K.T. ( 2012b ), “ The advertising effects of corporate social responsibility on corporate reputation and brand equity: evidence from the life insurance industry in Taiwan ”, Journal of Business Ethics , Vol.  109 No.  2 , pp.  189 - 201 .

Jo , H. and Harjoto , M.A. ( 2012 ), “ The causal effect of corporate governance on corporate social responsibility ”, Journal of Business Ethics , Vol.  106 No.  1 , pp.  53 - 72 .

Khan , Z.U. , Ahmad , N. , Nazim , Z. and Ramzan , M. ( 2021 ), “ Impact of CSR on corporate reputation, customer loyalty and organizational performance ”, Governance and Management Review , Vol.  5 No.  2 , pp.  195 - 210 .

Lai , C. , Chiu , C. , Yang , C. and Pai , D. ( 2010a ), “ The effects of corporate social responsibility on brand performance: the mediating effect of industrial brand equity and corporate reputation ”, Journal of Business Ethics , Vol.  95 No.  3 , pp.  457 - 469 .

Lai , C.S. , Chiu , C.J. , Yang , C.F. and Pai , D.C. ( 2010b ), “ The effects of corporate social responsibility on brand performance: the mediating effect of industrial brand equity and corporate reputation ”, Journal of Business Ethics , Vol.  95 No.  3 , pp.  457 - 469 .

Le , T.T. ( 2022 ), “ Corporate social responsibility and SMEs' performance: mediating role of corporate image, corporate reputation and customer loyalty ”, International Journal of Emerging Markets , Vol. ahead-of-print No. ahead-of print , doi: 10.1108/IJOEM-07-2021-1164 .

Lee , M.Y. , Fairhurst , A. and Wesley , S. ( 2009 ), “ Corporate social responsibility and corporate social performance ”, Corporate Reputation Review , Vol.  12 No.  2 , pp.  140 - 158 .

Liu , Y. , Chen , Y. , Ren , Y. and Jin , B. ( 2021 ), “ Impact mechanism of corporate social responsibility on sustainable technological innovation performance from the perspective of corporate social capital ”, Journal of Cleaner Production , Vol.  308 , p. 127345 .

Liu , Y.F. , Li , H. and Liang , S. ( 2022 ), “ Any reputation is a good reputation: influence of investor-perceived reputation in restructuring on hospitality firm performance ”, Annals of Tourism Research , Vol.  92 , p. 103327 .

Lee , J. and Jungbae Roh , J. ( 2012 ), “ Revisiting corporate reputation and firm performance link ”, Benchmarking: an International Journal , Vol.  19 Nos 4/5 , pp.  649 - 664 .

Mahon , J.F. and Waddock , S.A. ( 1992 ), “ Strategic issues management: an integration of issue life cycle perspectives ”, Business and Society , Vol.  31 No.  1 , pp. 19 - 32 .

Maignan , I. and Ferrell , O.C. ( 2001 ), “ Corporate citizenship as a marketing instrument – concepts, evidence and research directions ”, European Journal of Marketing , Vol.  35 Nos 3/4 , pp.  457 - 484 .

McGuire , J.B. , Sundgren , A. and Schneeweis , T. ( 1988 ), “ Corporate social responsibility and firm financial performance ”, Academy of Management Journal , Vol.  31 No.  4 , pp.  854 - 872 .

Ministry of Corporate Affiars ( 2016 ), “ The companies act, 2013 ”, available at: https://www.mca.gov.in/content/dam/mca/pdf/CompaniesAct2013.pdf .

Mishra , S. and Suar , D. ( 2010 ), “ Does corporate social responsibility influence firm performance of Indian companies? ”, Journal of Business Ethics , Vol.  95 No.  4 , pp.  571 - 601 .

Moir , L. ( 2001 ), “ What do we mean by corporate social responsibility? ”, Corporate Governance , Vol.  1 No.  2 , pp.  16 - 22 .

Neville , B.A. , Bell , S.J. and Mengu¨c , B. ( 2005 ), “ Corporate reputation, stakeholders and the social performance-financial performance relationship ”, European Journal of Marketing , Vol.  39 Nos 9/10 , pp.  1184 - 1198 .

Nguyen , N.T.T. , Nguyen , N.P. and Hoai , T.T. ( 2021 ), “ Ethical leadership, corporate social responsibility, firm reputation, and firm performance: a serial mediation model ”, Heliyon , Vol.  7 No.  4 , p. e06809 .

Odriozola , M.D. and Baraibar-Diez , E. ( 2017 ), “ Is corporate reputation associated with quality of CSR reporting? evidence from Spain ”, Corporate Social Responsibility and Environmental Management , Vol.  24 No.  2 , pp.  121 - 132 .

Otto , A.S. , Szymanski , D.M. and Varadarajan , R. ( 2020 ), “ Customer satisfaction and firm performance: insights from over a quarter century of empirical research ”, Journal of the Academy of Marketing Science , Vol.  48 No.  3 , pp.  543 - 564 .

Özcan , F. and Elçi , M. ( 2020 ), “ Employees’ perception of CSR affecting employer brand, brand image, and corporate reputation ”, SAGE Open , Vol.  10 No.  4 , pp. 1 - 13 .

O'Connor , P. and Assaker , G. ( 2022 ), “ Examining the antecedents and effects of hotel corporate reputation on customers' loyalty and citizenship behavior: an integrated framework ”, Journal of Hospitality Marketing and Management , available at: https://www.tandfonline.com/doi/abs/10.1080/19368623.2022.2034560 ( accessed January 2022 ).

Park , S. ( 2017 ), “ Corporate social responsibility, visibility, reputation and financial performance: empirical analysis on the moderating and mediating variables from Korea ”, Social Responsibility Journal , Vol.  13 No.  4 , pp.  856 - 871 .

Paton , D. and Williams , L.V. ( 1999 ), “ Advertising and firm performance: some new evidence from UK firms ”, Economic Issues , Vol.  4 No.  2 , pp.  89 - 105 .

Porter , M.E. ( 1980 ), Competitive Strategy Techniques for Analyzing Industries and Competitors , Free Press , New York .

Porter , M.E. and Kramer , M.R. ( 2006 ), “ Strategy and society: the link between competitive advantage and corporate social responsibility ”, Harvard Business Review , Vol.  84 No.  12 , pp.  78 - 92 .

Pradhan , S. ( 2016 ), “ Impact of corporate social responsibility intensity on corporate reputation and financial performance of Indian firms ”, Business: Theory and Practice , Vol.  17 No.  4 , pp.  371 - 380 .

Pradhan , S. ( 2018 ), “ Role of CSR in the consumer decision making process – the case of India ”, Social Responsibility Journal , Vol.  14 No.  1 , pp.  138 - 158 .

Pradhan , S. and Roy , S. ( 2011 ), “ The nature of socially responsible communication in Indian companies ”, Business: Theory and Practice , Vol.  12 No.  1 , pp.  24 - 32 .

Quéré , B.P. , Nouyrigat , G. and Baker , C.R. ( 2018 ), “ A Bi-directional examination of the relationship between corporate social responsibility ratings and company financial performance in the European context ”, Journal of Business Ethics , Vol.  148 No.  3 , pp.  527 - 544 .

Rajan , R.G. and Zingales , L. ( 1995 ), “ What do we know about capital structure? some evidence from international data ”, The Journal of Finance , Vol.  50 No.  5 , pp.  1421 - 1460 .

Ramaswamy , K. ( 2001 ), “ Organizational ownership, competitive intensity, and firm performance: an empirical study of the Indian manufacturing sector ”, Strategic Management Journal , Vol.  22 No.  10 , pp.  989 - 998 .

Roberts , P.W. and Dowling , G.R. ( 2002 ), “ Corporate reputation and sustained superior financial performance ”, Strategic Management Journal , Vol.  23 No.  12 , pp.  1077 - 1093 .

Sanchez , J.L.F. and Sotorrio , L.L. ( 2007 ), “ The creation of value through corporate reputation ”, Journal of Business Ethics , Vol.  76 No.  3 , pp.  335 - 346 .

Schumpeter , J.A. ( 1942 ), Capitalism, Socialism and Democracy , Routledge , London and New York .

Schwaiger , M. ( 2004 ), “ Components and parameters of corporate reputation – an empirical study ”, Schmalenbach Business Review , Vol.  56 No.  1 , pp.  46 - 71 .

Sen , S. and Bhattacharya , C.B. ( 2001 ) “ Does doing good always lead to doing better? Consumer reactions to Corporate Social Responsibility ”, Journal of Marketing Research , Vol.  38 N0. 2 , pp.  225 - 243 .

Sen , S. , Bhattacharya , C.B. and Korschun , D. ( 2006 ), “ The role of corporate social responsibility in strengthening multiple stakeholder relationships: a field experiment ”, Journal of the Academy of Marketing Science , Vol.  34 No.  2 , pp.  158 - 166 .

Shimp , T.A. ( 1997 ), Advertising, Promotion and Supplemental Aspects of Integrated Marketing Communications , Dryden , Orlando, FL .

Singh , K. and Misra , M. ( 2021 ), “ Linking corporate social responsibility (CSR) and organizational performance: the moderating effect of corporate reputation ”, European Research on Management and Business Economics , Vol.  27 No.  1 , p. 100139 .

Su , L. , Pan , Y. and Chen , X. ( 2017 ), “ Corporate social responsibility: findings from the Chinese hospitality industry ”, Journal of Retailing and Consumer Services , Vol.  34 , pp.  240 - 247 .

Ting , P.H. and Yin , H.Y. ( 2018 ), “ How do corporate social responsibility activities affect performance? The role of excess control right ”, Corporate Social Responsibility and Environmental Management , Vol.  25 No.  6 , pp.  1320 - 1331 .

Ullah , Z. , Ahmad , N. , Nazim , Z. and Ramzan , M. ( 2020 ), “ Impact of CSR on corporate reputation, customer loyalty and organizational performance ”, Governance and Management Review , Vol.  5 No.  2 , pp. 195 - 210 .

Vij , S. and Bedi , H.S. ( 2016 ), “ Are subjective business performance measures justified? ”, International Journal of Productivity and Performance Management , Vol.  65 No.  5 , pp.  603 - 621 .

Weiss , A.M. , Anderson , E. and MacInnis , D.J. ( 1999 ), “ Reputation management as a motivation for sales structure decisions ”, Journal of Marketing , Vol.  63 No.  4 , pp.  74 - 89 .

Woo , H.-S. , Berns , J. , Mukherjee , K. and Kim , J. ( 2021 ), “ How increased foreign competition motivates domestic firms to do good: an examination of foreign entry mode and domestic CSR response ”, Journal of Strategy and Management , Vol. ahead-of-print No. ahead-of-print , doi: 10.1108/JSMA-05-2021-0118 .

Wood , D.J. and Jones , R.E. ( 1995 ), “ Stakeholder mismatching: a theoretical problem in empirical research on corporate social performance ”, The International Journal of Organizational Analysis , Vol.  3 No.  3 , pp.  229 - 267 .

Xie , X. , Jia , Y. , Meng , X. and Li , C. ( 2017 ), “ Corporate social responsibility, customer satisfaction, and financial performance: the moderating effect of the institutional environment in two transition economies ”, Journal of Cleaner Production , Vol.  150 , pp.  26 - 39 .

Yang , J. and Basile , K. ( 2021 ), “ Communicating corporate social responsibility: external stakeholder involvement, productivity and firm performance ”, Journal of Business Ethics , doi: 10.1007/s10551-021-04812-5 .

Zadek , S. , Pruzan , P. and Evans , R. ( 1997 ), Building Corporate Accountability: Emerging Practices in Social and Ethical Accounting, Auditing and Reporting , Earthscan , London .

Zahid , M. , Naeem , H. , Aftab , I. and Mughal , S.A. ( 2021 ), “ From corporate social responsibility activities to financial performance: role of innovation and competitive advantage ”, Asia Pacific Journal of Innovation and Entrepreneurship , Vol.  15 No.  1 , pp.  2 - 13 .

Zhou , Z. and Ki , E.J. ( 2018 ), “ Exploring the role of CSR fit and the length of CSR involvement in routine business and corporate crises settings ”, Public Relations Review , Vol.  44 No.  1 , pp.  75 - 83 .

Further reading

Berman , S.L. , Wicks , A.C. , Kotha , S. and Jones , T.M. ( 1999 ), “ Does stakeholder orientation matter? The relationship between stakeholder management models and firm financial performance ”, Academy of Management Journal , Vol.  42 No.  5 , pp.  488 - 506 .

Mahon , J.F. ( 2002 ), “ Corporate reputation: a research agenda using strategy and stakeholder literature ”, Business and Society , Vol.  41 No.  4 , pp.  415 - 445 .

Corresponding author

About the author.

Dr Makhmoor Bashir is currently working as an Assistant Professor of Business Strategy at the college of business and economics (AACSB Accredited), Qassim University. His recent research has been published in international journals of repute such as Journal of Travel Research, Management Decision, Studies in Higher Education, Education and Information technologies, Corporate Reputation Review and International Journal of Innovation Science , etc. Dr Bashir has also presented his work at many international conferences, such as the Strategic Management Society and North American Marketing Society for Education in India. He has developed teaching cases on Uber, Airbnb, Xiaomi, Spice Jet, Connect Broadband, etc. Dr Bashir is also the reviewer for the International Journal of Hospitality Management (Elsevier) and Journal of Modelling in Management (Emerald). Dr. Bashir has also received an outstanding reviewer award in 2018 from the International Journal of Hospitality Management . His research interests include business model innovation, competitive advantage, technological developments and knowledge hiding.

Related articles

We’re listening — tell us what you think, something didn’t work….

Report bugs here

All feedback is valuable

Please share your general feedback

Join us on our journey

Platform update page.

Visit emeraldpublishing.com/platformupdate to discover the latest news and updates

Questions & More Information

Answers to the most commonly asked questions here

• Review Article
• Open access
• Published: 22 January 2019

A literature review of the history and evolution of corporate social responsibility

• Mauricio Andrés Latapí Agudelo   ORCID: orcid.org/0000-0002-7157-4015 1 ,
• Lára Jóhannsdóttir 1 &
• Brynhildur Davídsdóttir 1  

International Journal of Corporate Social Responsibility volume  4 , Article number:  1 ( 2019 ) Cite this article

419k Accesses

312 Citations

70 Altmetric

Metrics details

There is a long and varied history associated with the evolution of the concept of Corporate Social Responsibility (CSR). However, a historical review is missing in the academic literature that portrays the evolution of the academic understanding of the concept alongside with the public and international events that influenced the social expectations with regards to corporate behavior. The aim of this paper is to provide a distinctive historical perspective on the evolution of CSR as a conceptual paradigm by reviewing the most relevant factors that have shaped its understanding and definition, such as academic contributions, international policies and significant social and political events. To do so, the method used is a comprehensive literature review that explores the most relevant academic contributions and public events that have influenced the evolutionary process of CSR and how they have done so. The findings show that the understanding of corporate responsibility has evolved from being limited to the generation of profit to include a broader set of responsibilities to the latest belief that the main responsibility of companies should be the generation of shared value. The findings also indicate that as social expectations of corporate behavior changed, so did the concept of Corporate Social Responsibility. The findings suggest that CSR continues to be relevant within the academic literature and can be expected to remain part of the business vocabulary at least in the short term and as a result, the authors present a plausible future for CSR that takes into consideration its historical evolution. Finally, this paper gives way for future academic research to explore how CSR can help address the latest social expectations of generating shared value as a main business objective, which in turn may have practical implications if CSR is implemented with this in mind.

Introduction

The current belief that corporations have a responsibility towards society is not new. In fact, it is possible to trace the business’ concern for society several centuries back (Carroll 2008 ). However, it was not until the 1930’s and 40’s when the role of executives and the social performance of corporations begun appearing in the literature (Carroll 1999 ) and authors begun discussing what were the specific social responsibilities of companies. In the following decades, the social expectations towards corporate behavior changed and so did the concept of Corporate Social Responsibility (CSR). The aim of this article is to find out which have been the main factors and/or events that have influenced the evolutionary process of CSR and how they have shaped the understanding of the concept. This will allow to recognize CSR as a concept that reflects the social expectations of each decade and be able to explore if it will remain relevant in the near future.

This review focuses on the most relevant academic publications and historical events that have influenced the evolution of CSR as a conceptual paradigm. The review begins with the historical roots of social responsibility and then explores the early stages of the formal and academic writing about the social responsibilities of corporations and goes through its evolution to the latest understanding of CSR. Considering that the history of CSR is long and vast, it is necessary to point out that this article focuses on publications that have provided an original perspective and understanding to the concept of CSR along with the most significant papers with regards to the evolution of the social expectations of corporate behavior (see Appendix for additional recommended readings). Along with these papers, the review takes into consideration articles that have been cited the most and can be considered as significant contributors to the evolution of the concept as well as publications that provide new definitions and frameworks. It is relevant to point out that this paper will focus on the development of CSR as a definitional construct and will not explore in detail alternative concepts that emerged in the late twentieth century.

This article reviews the key historical events that played a role in the evolution of CSR. In particular, the paper focuses on events that influenced to a certain extent corporations to assume broader social responsibilities Accordingly, this article focuses on the relevant inputs to the definitional construct of the concept, most of which are of Anglo-American character, but it also considers that the growing attention on CSR has been influenced by specific calls for better business practices, such as the European CSR Strategy. As such, this paper does not portray the entire literature on the subject but highlights the key factors that shaped the evolution of CSR. Accordingly, the authors provide a summary of the evolution of the concept through a chronological timeline that allows the reader to follow the history of CSR by pointing out the most relevant academic contributions as well as the most significant events that played a role in shaping it as a conceptual paradigm.

The main contribution of this paper is a structured historical review that is accompanied with a chronological timeline of the evolution of CSR. Accordingly, the article contributes to the literature by exploring how the societal expectations of corporate behavior of each period have influenced the understanding and definitional construct of CSR. Furthermore, this article contributes to the literature on CSR by providing an innovative review of the evolution of the concept that contextualizes its development with a connection to the wider changes happening in each period. This paper also contributes to the current understanding of CSR by including a review of the development of CSR in the early twenty-first century, a period that has not been reviewed as much as earlier periods of the development of the concept.

Research method

The formal publications and literature on CSR begun as early as the 1930’s and continues to be relevant among academic journals, business magazines, books, and reports from international bodies as well as from non-governmental organizations and associations. This means that the literature on the subject is broad and a specific method is needed to achieve a comprehensive review. Given these aspects, the research was carried out following a systematic literature review (SLR) as understood by Okoli and Schabram ( 2010 ) who built on from Fink’s ( 2005 ) definition of a research literature review to define it as a systematic, explicit, comprehensive and reproducible method. The motivation for following a SLR is because it is commonly used to summarize the existing literature and identify gaps, to describe the available body of knowledge to guide professional practice, to identify effective research and development methods, to identify experts within a given field and to identify unpublished sources of information (Fink 2005 ; Okoli and Schabram 2010 ).

The extensive nature of the CSR literature required to limit the scope of the research to thematic areas directly related to the evolution and history of the concept and also limited to publications of academic or institutional character considering that they have already undergone a rigorous peer review that indicates a suitable quality for this SLR. The initial search was conducted for published journal articles using the search words “corporate social responsibility”, “history of CSR” and “evolution of CSR” on the online databases of Science Direct, ProQuest and Web of Science along with the search engine of Google Scholar. The searches were made within the search windows of the website of each database in the titles, abstracts and body of the articles and the results were provided in order of relevance. The first selection was limited to the titles of the publications and was followed by a review of the keywords and abstracts of the preferred articles. To determine the suitability of some of the articles it was necessary to review their introduction and scope. The next step in the selection of articles was focused on their quality and relevance which was determined by reviewing the level of impact factor of the journal of publication as well as the amount of citations the article has had, looking specifically for a high impact factor for each individual paper. Each article was then reviewed to determine its relevance for the research. Some articles pointed to additional references outside the initial search scope which were then searched online for their review. This included business magazines, books, and reports from international bodies and non-governmental organizations and associations. These references were reviewed and selected according to their pertinence and contribution for this paper. Following this systematic strategy allowed to review published journal articles with high impact factors along with publications of relevance mentioned by the authors of such articles. Some publications with regards to CSR had to be excluded from this review because they did not contribute directly to the evolution of the concept but we believe they are of interest in the CSR literature and thus they are listed in Appendix . Finally, the paper is structured in a way that each section corresponds to a particular period making it easier to follow the evolutionary process of CSR.

Historical roots of social responsibility

For Chaffee ( 2017 ), the origins of the social component in corporate behavior can be traced back to the ancient Roman Laws and can be seen in entities such as asylums, homes for the poor and old, hospitals and orphanages. This notion of corporations as social enterprises was carried on with the English Law during the Middle Ages in academic, municipal and religious institutions. Later, it expanded into the sixteenth and seventeenth centuries with the influence of the English Crown, which saw corporations as an instrument for social development (Chaffee 2017 ). In the following centuries, with the expansion of the English Empire and the conquering of new lands, the English Crown exported its corporate law to its American colonies where corporations played a social function to a certain extent Footnote 1 (Chaffee 2017 ).

During the eighteenth and nineteenth centuries, the Christian religious philosophy and approach to the abiding social context were seen as a response to the moral failure of society, which was visible in terms of poverty of the overall population in the English Empire and some parts of Europe (Harrison 1966 ). This religious approach gave way to social reforms and to the Victorian philanthropy which perceived a series of social problems revolving around poverty and ignorance as well as child and female labor (Carroll 2008 ; Harrison 1966 ). The religious roots of the Victorian social conscience gave Victorian Philanthropists a high level of idealism and humanism, and by the late 1800’s, the philanthropic efforts focused on the working class and the creation of welfare schemes with examples that could be seen in practice both in Europe as in the United States of America (USA) (Carroll 2008 ; Harrison 1966 ). A clear case was the creation of the Young Men’s Christian Association (YMCA), a movement that begun in London in 1844 with the objective of applying Christian values to the business activities of the time, a notion that quickly spread to the USA (see: Heald 1970 ).

During the late 1800’s and early 1900’s, the creation of welfare schemes took a paternalistic approach aimed at protecting and retaining employees and some companies even looked into improving their quality of life (Carroll 2008 ; Heald 1970 ). For Heald ( 1970 ), there were clear examples that reflected the social sensitivity of businessmen, such as the case of Macy’s in the USA, which in 1875 contributed funds to an orphan asylum and by 1887 labeled their charity donations as Miscellaneous Expenses within their accounting books, and the case of Pullman Palace Car Company which created a model industrial community in 1893 with the aim of improving the quality of life of its employees.

Also during this period, there was a growing level of urbanization and industrialization marked by large-scale production. This brought new concerns to the labor market such as: new challenges for farmers and smalls corporations to keep up with the new interdependent economy, the creation of unions of workers looking for better working conditions, and a middle class worried for the loss of religious and family values in the new industrial society (Heald 1970 ). As a response to these new challenges, and with the aim of finding harmony between the industry and the working force, some business leaders created organizations for the promotion of values and improvement of the working conditions. Such was the case of the Civic Federation of Chicago, an organization created to promote better working conditions and where religious values merged with economic objectives with a sense of civic pride (Heald 1970 ).

By the 1920’s and early 1930’s, business managers begun assuming the responsibility of balancing the maximization of profits with creating and maintaining an equilibrium with the demands of their clients, their labor force, and the community (Carroll 2008 ). This led to managers being viewed as trustees for the different set of external relations with the company, which in turn translated into social and economic responsibilities being adopted by corporations (Carroll 2008 ; Heald 1970 ). Later, with the growth of business during World War II and the 1940’s, companies begun to be seen as institutions with social responsibilities and a broader discussion of such responsibilities began taking place (Heald 1970 ). Some early examples of the debate of the social responsibilities of corporations can be found in The Functions of the Executive by Barnard ( 1938 ) and the Social Control of Business by Clark ( 1939 ).

1950’s and 1960’s: the early days of the modern era of social responsibility

It was not until the early 1950’s that the notion of specifically defining what those responsibilities were was first addressed in the literature and can be understood as the beginning of the modern definitional construct of Corporate Social Responsibility. In fact, it was during the 1950’s and 1960’s that the academic research and theoretical focus of CSR concentrated on the social level of analysis (Lee 2008 ) providing it with practical implications.

The period after World War II and the 1950’s can be considered as a time of adaptation and changing attitudes towards the discussion of corporate social responsibility, but also a time where there were few corporate actions going beyond philanthropic activities (Carroll 2008 ). Perhaps the most notable example of the changing attitude towards corporate behavior came from Bowen ( 1953 ), who believed that the large corporations of the time concentrated great power and that their actions had a tangible impact on society, and as such, there was a need for changing their decision making to include considerations of their impact.

As a result of his belief, Bowen ( 1953 ) set forth the idea of defining a specific set of principles for corporations to fulfill their social responsibilities. For him, the businessman ’s Footnote 2 decisions and actions affect their stakeholders, employees, and customers having a direct impact on the quality of life of society as a whole (Bowen 1953 ). With this in mind, Bowen defined the social responsibilities of business executives as “the obligations of businessmen to pursue those policies, to make those decisions, or to follow those lines of action which are desirable in terms of the objectives and values of our society” (Bowen 1953 , p. 6). As Carroll ( 2008 ) explains, it seems that Bowen ( 1953 ) was ahead of his time for his new approach to management which aimed at improving the business response to its social impact and by his contributions to the definition of corporate social responsibility. Furthermore, the relevance of Bowen’s approach relies on the fact that this was the first academic work focused specifically on the doctrine of social responsibility, making Bowen the “Father of Corporate Social Responsibility” (Carroll 1999 ).

After Bowen, other authors were concerned with corporate behavior and its response to the social context of the time. For example, in the book Corporation Giving in a Free Society published in 1956, Eells ( 1956 ) argued that the large corporations of the time were not living up to their responsibility in a time of generalized inflation. In a similar way, with the book A moral philosophy for management published in 1959, Selekman ( 1959 ) explored the evolution of the moral responsibility of corporations as a response to the labor expectations of the time.

These early explorations of CSR as a definitional construct, along with the social context of the time, gave way to a growing interest of scholars to define what CSR was and what it meant (Carroll 2008 ). Naturally, it is understandable that the interest in CSR during 1960’s was influenced by growing awareness in society and social movements of the time. However, it is necessary to point out that the effect of this growing interest was perhaps more visible in the USA, which is why some examples of the following sections might seem to center on this particular country.

Some of society’s main concerns during this period revolved around rapid population growth, pollution, and resource depletion (Du Pisani 2006 ) and were accompanied with social movements with respect to the environment and human and labor rights (Carroll 1999 ). At the same time, books such as The Silent Spring by Carson ( 1962 ) and The Population Bomb by Ehrlich ( 1968 ) begun raising questions with regards to the limits of economic growth and the impact that society and corporations were having on the environment.

During the 1960’s there was also a new social context marked by a growing protest culture that revolved mainly around civil rights and anti-war protests. In the case of the USA, the protests transformed from being student-led sit-ins, walk-outs and rallies, to more radical political activism which, in most cases, saw business corporations as an integral part of the “establishment” they wanted to change (Waterhouse 2017 ). These protests put pressure on companies that, in the protestors’ view, represented the “establishment” (i.e. banks and financial institutions as well large scale corporations) but had a strong focus on those with direct links to war. An example is the case of the Dow Chemical Company which produced napalm used in the Vietnam War and as a result faced constant protests and accusations (Waterhouse 2017 ).

Accordingly, during the 1960’s scholars approached CSR as a response to the problems and desires of the new modern society. A notable example of this period was Keith Davis ( 1960 ), who explained that the important social, economic and political changes taking place represented a pressure for businessmen to re-examine their role in society and their social responsibility. Davis ( 1960 ) argued that businessmen have a relevant obligation towards society in terms of economic and human values, and asserted that, to a certain extent, social responsibility could be linked to economic returns for the firm (Carroll 1999 ; Davis 1960 ). The significance of Davis’ ideas is that he indicated that the “social responsibilities of businessmen need to be commensurate with their social power” (p. 71) and that the avoidance of such would lead to a decrease of the firm’s social power (Davis 1960 ).

Other influential contributors of the time were Frederick ( 1960 ), McGuire ( 1963 ) and Walton ( 1967 ). Frederick ( 1960 ) saw the first half of the twentieth century as an intellectual and institutional transformation that changed the economic and social thinking and brought with it an increased economic power to large scale corporations. To balance the growing power of businessmen, Frederick ( 1960 ) proposed a new theory of business responsibility based on five requirements: 1) to have a criteria of value (in this case for economic production and distribution), 2) to be based on the latest concepts of management and administration, 3) to acknowledge the historical and cultural traditions behind the current social context, 4) to recognize that the behavior of an individual businessmen is a function of its role within society and its social context, and, 5) to recognize that responsible business behavior does not happen automatically but on the contrary, it is the result of deliberate and conscious efforts; then McGuire ( 1963 ), who reviewed the development of business institutions and observed changes in the scale and type of corporations, changes in public policies, and regulatory controls for businesses as well as changes in the social and economic conditions of the time. As a response to these changes, McGuire ( 1963 ) argued that the firm’s responsibility goes beyond its legal and economic obligations, and that corporations should take an interest in politics, the social welfare of the community, and the education and happiness of its employees; and Walton ( 1967 ), who explored the ideological changes taking place during the 1950’s and 60’s which were reflected in public policies, some of which saw corporations as potential contributors to the improvement of the social and economic conditions of the time (see: Walton 1967 ; Walton 1982 ). Accordingly, he provided a definition of social responsibility with which he acknowledged the relevance of the relationship between corporations and society.

It is relevant to point out that even when some scholars begun applying a wider scope to the social responsibilities of corporations, there were others who were skeptical of the notion of CSR. Notably, Milton Friedman, a renowned economist and later a Nobel laurate in economics (1976), gave in 1962 a particular perspective of the role of corporations in a free capitalist system in which firms should limit to the pursuit of economic benefits (see: Friedman 1962 ). Friedman would further explore this notion in the article The Social Responsibility of Business is to Increase its Profits published in (Friedman 1970 ) in which he sees CSR activities as an inappropriate use of company’s resources that would result in the unjustifiable spending of money for the general social interest.

Even when the social context of the 1960’s was, to some extent, reflected in the academic approach to CSR, its practical implementation remained mostly with a philanthropic character (Carroll 2008 ). Nonetheless, by the end of the decade the overall social context was reflected in the form of a strong pressure on corporations to behave according to the social expectations of the time, most of which were vividly expressed in protests and environmental and antiwar campaigns (Waterhouse 2017 ).

The 1970’s: CSR and management

The antiwar sentiment, the overall social context, and a growing sense of awareness in society during the late 1960’s translated into a low level of confidence in business to fulfill the needs and wants of the public (Waterhouse 2017 ). In fact, the low level of confidence in the business sector reached a significant point when in 1969 a major oil spill in the coast of Santa Barbara, California led to massive protests across the USA and eventually resulted in the creation of the first Earth Day celebrated in 1970. During the first Earth Day, 20 million people across the USA joined protests to demand a clean and sustainable environment and to fight against pollution, which was caused mainly by corporations (e.g. oil spills, toxic dumps, polluting factories and power plants) (Earth Day 2018 ). The first Earth Day influenced the political agenda of the USA in such a significant manner that it played a role in pushing forward the creation of the Environmental Protection Agency (EPA) by the end of 1970 (Earth Day 2018 ) and translated into a new regulatory framework that would later influence corporate behavior and create additional responsibilities for corporations.

It is equally important to mention that in the year 1970 there was a recession in the USA that was marked by a high inflation and very low growth followed by a long energy crisis (Waterhouse 2017 ). As a response to this context, and as a result of the social movements of the 1960’s and early 1970’s, the federal government of the USA made significant advances with regards to social and environmental regulations. The most notable examples were the creation of the EPA, the Consumer Product Safety Commission (CPSC), the Equal Employment Opportunity Commission (EEOC) and the Occupational Safety and Health Administration (OSHA), all of which addressed and formalized to some extent, the responsibilities of businesses with regards to the social concerns of the time (Carroll 2015 ).

Similarly, two relevant contributions from the early 1970’s that responded to the social expectations of the time came from the Committee for Economic Development (CED) of the USA, first with the publication of A New Rationale for Corporate Social Policy which explored to what extent it is justified for corporations to get involved in social problems (Baumol 1970 ) and then with the publication of the Social Responsibilities of Business Corporations which explored the new expectations that society begun placing on the business sector (Committee for Economic Development 1971 ). These publications are of relevance because they advanced the public debate around CSR by acknowledging that “business functions by public consent, and its basic purpose is to serve constructively the needs of society – to the satisfaction of society” (Committee for Economic Development 1971 , p. 11).

As Carroll ( 1999 ) and Lee ( 2008 ) point out, these publications reflect a new rationale with regards to the roles and responsibilities of corporations. Furthermore, the Committee for Economic Development ( 1971 ) acknowledged that the social contract between business and society was evolving in substantial and important ways and specifically noted that: “Business is being asked to assume broader responsibilities to society than ever before and to serve a wider range of human values. Business enterprises, in effect, are being asked to contribute more to the quality of American life than just supplying quantities of goods and services. Inasmuch as business exists to serve society, its future will depend on the quality of management’s response to the changing expectations of the public” (Committee for Economic Development 1971 , p. 16).

The Club of Rome, formed in 1968 by a group of researchers that included scientists, economists and business leaders from 25 different countries, published in 1972 the report The Limits to Growth (World Watch Institute n.d. ), a study led by the Massachusetts Institute of Technology (MIT) which questioned the viability of continued growth and its ecological footprint (The Club of Rome 2018 ). The report became of relevance for the international community because it brought the attention towards the impact of population growth, resource depletion and pollution, and pointed out the need of responsible business practices and new regulatory frameworks.

The 1970’s saw the creation of some of today’s most renowned companies with respect to social responsibility. Such is the case of the Body Shop, which was created in 1976 in the United Kingdom and Ben & Jerry’s founded in 1978 in the USA. Whether as a response to the new social expectations, a new regulatory framework, or due to a first-mover strategy, these are two notable examples of companies that begun formalizing and integrating policies that addressed the social and public issues of the time, and as a result the 1970’s entered into what Carroll ( 2015 , p. 88) called an era of “managing corporate social responsibility”. This meant that the term Corporate Social Responsibility became increasingly popular which resulted in its use under many different contexts and to such an extent that its meaning became unclear, and as a consequence it meant something different for everybody (Sethi 1975 ; Votaw 1973 ).

For instance, for Preston and Post ( 1975 ), corporations have a public responsibility that is limited by clear boundaries, meaning that anything outside is not an obligation for the firm and explained that going beyond those limits offers no clear direction for achieving the company’s main goals and can translate into an inefficient re-orientation of activities. In fact, Preston and Post stated that companies are not responsible for improving social conditions or addressing social problems and argued that a firm’s responsibility extends only to the direct consequences of their decisions and activities in which they engage (Preston and Post 1975 ). A different perception came from Sethi ( 1975 ), for whom social responsibility entails that corporate behavior should be coherent with the social norms, values and expectations, and as a result it should be prescriptive.

The unrestricted use of the term Corporate Social Responsibility during the 1970’s created an uncertainty with regards to its definition. This lasted until 1979, when Carroll proposed what is arguably the first unified definition of Corporate Social Responsibility stating that: “The social responsibility of business encompasses the economic, legal, ethical, and discretionary expectations that society has of organizations at a given point in time” (Carroll 1979 , p. 500). Even when Carroll’s ( 1979 ) approach to social responsibility corresponded to the discussion on corporate behavior of the time, and was mainly driven by the social movements of the 1960’s and the new legislations in the USA, its relevance relies on the fact that his definition builds on from the work of other scholars (including the CED) to provide a clear and concise conceptualization that could be applicable under any context, which was not the case of previous definitions of CSR (see previous definitions from: Davis 1973 ; Frederick 1960 ; M. Friedman 1962 ; McGuire 1963 ; Walton 1967 ). Another relevant contribution of Carroll’s understanding of CSR is that it does not see the economic and social objectives as incompatible trade-offs but rather as an integral part of the business framework of total social responsibility (Lee 2008 ).

During the 1970’s, the understanding of CSR was influenced by social movements and new legislations. This was reflected in the academic publications which provided companies with an approach that looked into how to comply with the new responsibilities that have been given to them by the new legislations that now covered environmental aspects as well as product safety, and labor rights (Carroll 2008 ). This gave way to the 1980’s where the discussion revolved on the ways for implementing CSR.

The 1980’s: the operationalization of CSR

During the 1970’s, there were a growing number of legislations that attended the social concerns of the time and gave a broader set of responsibilities to corporations. By contrast, during the 1980’s the Reagan and Thatcher administrations brought a new line of thought into politics with a strong focus on reducing the pressure on corporations and aiming to reduce the high levels of inflation that the USA and the United Kingdom (UK) were facing (see: Feldstein 2013 ; Wankel 2008 ). For Reagan and Thatcher, the growth and strength of the economies of their countries depended on their ability to maintain a free market environment with as little as possible state intervention (Pillay 2015 ). To do so, Reagan’s main economic goals focused on reducing the regulations on the private sector complemented with tax reductions (Feldstein 2013 ).

With governments reducing their role in regulating corporate behavior, managers were faced with a need to answer to different interest groups that still expected corporations to fulfill the social expectations of the time. Notably, the reduced regulatory framework led scholars to look into business ethics and the operationalization of CSR as a response to groups such as shareholders, employees and consumers, and the term stakeholder became common (Carroll 2008 ; Wankel 2008 ). However, scholars also begun looking into alternative or complementary concepts to CSR, some of which include corporate social performance, corporate social responsiveness, and stakeholder theory and management (Carroll 2008 ). For the purpose of this paper we will continue to focus our attention on the development of CSR as a definitional construct.

In 1980, Thomas M. Jones ( 1980 ) was arguably the first author to consider CSR as a decision making process that influence corporate behavior. Jones’ ( 1980 ) contribution gave way to a new area of debate around CSR which focused more on its operationalization than on the concept itself. This translated into the creation of new frameworks, models, and methods aimed at evaluating CSR from an operational perspective. Some notable examples of the 1980’s came from Tuzzolino and Armandi ( 1981 ), who presented a need-hierarchy framework through which the company’s socially responsible performance can be assessed based on five criteria (profitability, organizational safety, affiliation and industry context, market position and competitiveness, and self-actualization); Strand ( 1983 ), who proposed a systems model to represent the link between an organization and its social responsibility, responsiveness and responses and who identified internal and external effects of company’s behavior; Cochran and Wood ( 1984 ), who used the combined Moskowitz list Footnote 3 , a reputation index, to explore the relation between CSR and financial performance; and Wartick and Cochran ( 1985 ) who reorganized Carroll’s understanding of CSR (1979) into a framework of principles, processes, and social policies.

Perhaps the best way to understand the operationalization approach to CSR during the 1980’s is by keeping in mind that during this time there were new societal concerns. Notably, these concerns can be observed in a series of events that reflected the approach of the international community towards sustainable development and to a certain extent, to corporate behavior. The most relevant include: the creation of the European Commission’s Environment Directorate-General (1981), the establishment of the World Commission on Environment and Development chaired by the Norwegian Prime Minister Gro Harlem Brundtland (1983), the Chernobyl nuclear disaster (1986), the publication of the report Our Common Future presented by the Brundtland Commission which provided a definition of sustainable development (1987), the United Nations (UN) adoption of the Montreal Protocol (1987), and the creation of the Intergovernmental Panel on Climate Change (IPCC) (1988).

Even when these events did not relate directly to CSR, and hence did not influence directly the evolution of the concept, they reflected a growing sense of awareness of the international community with regards to environmental protection and sustainable development, and indirectly to corporate behavior. In fact, for Carroll ( 2008 ), the most relevant societal concerns and expectations of corporate behavior during the 1980’s revolved around “environmental pollution, employment discrimination, consumer abuses, employee health and safety, quality of work life, deterioration of urban life, and questionable/abusiveness practices of multinational corporations” (p. 36). As Carroll ( 2008 ) explained, this context gave way for scholars to begin looking into alternative themes, and during the 1980’s the concepts of business ethics and stakeholder management became part of the business vocabulary being part of a wider discussion around the corporate behavior of the time.

The 1990’s: globalization and CSR

During the 1990’s, significant international events influenced the international perspective towards social responsibility and the approach to sustainable development. The most relevant include: the creation of the European Environment Agency (1990), the UN summit on the Environment and Development held in Rio de Janeiro which led to the Rio Declaration on Environment and Development, the adoption of Agenda 21 and the United Nations Framework Convention on Climate Change (UNFCCC) (1992), and the adoption of the Kyoto Protocol (1997). The creation of these international bodies and the adoption of international agreements represented international efforts for setting higher standards with regards to climate-related issues and, indirectly to corporate behavior (see: Union of Concerned Scientists 2017 ).

The 1990’s were no exception to the growing interest in CSR, and in fact, it was during this decade that the concept gained international appeal, perhaps as the result of the international approach to sustainable development of the time in combination to the globalization process taking place. As Carroll ( 2015 ) explained, during the 1990’s the globalization process increased the operations of multinational corporations which now faced diverse business environments abroad, some of them with weak regulatory frameworks. For these global corporations it meant new opportunities that came along with a rising global competition for new markets, an increased reputational risk due to a growth in global visibility, and conflicting pressures, demands, and expectations from the home and the host countries (Carroll 2015 ).

Many multinational corporations understood that being socially responsible had the potential to be a safe pathway to balance the challenges and opportunities of the globalization process they were experiencing and as a result, the institutionalization of CSR became stronger (Carroll 2015 ). The most notable example of the institutionalization of CSR was the foundation in 1992 of the association Business for Social Responsibility (BSR) which initially included 51 companies with the vision of a becoming a “force for positive social change - a force that would preserve and restore natural resources, ensure human dignity and fairness, and operate transparently” (Business for Social Responsibility 2018 , para. 2).

The European Commission (EC) also played a relevant role in encouraging the implementation of CSR and begun promoting it as early as 1995 when 20 business leaders adopted the European Business Declaration against Social Exclusion in response to the EC’s call to combat social exclusion and unemployment (CSR Europe n.d. ). This resulted 1 year later, in the launch of the European Business Network for Social Cohesion (later renamed CSR Europe) which gathered business leaders with the aim of enhancing CSR within their organizations (CSR Europe n.d. ).

Even when the institutionalization of CSR grew stronger in the 1990’s, the concept itself didn’t evolve as much (Carroll 1999 ). Nevertheless, there are three contributions to CSR that are relevant to point out: Donna J. Wood ( 1991 ), driven by what she saw as a need for a systematical integration of conceptual aspects into a unified theory, built on the models of Carroll ( 1979 ) and Wartick and Cochran ( 1985 ) to create a model of Corporate Social Performance (CSP). Wood ( 1991 ) defined three dimensions of CSP: first, the principles of Corporate Social Responsibility, which include legitimacy (institutional level), public responsibility (organizational level), and managerial discretion (individual level). Second, she defined the processes of corporate social responsiveness as environmental assessment, stakeholder management, and issues management. Third, she specified the outcomes of corporate behavior as social impacts, social programs, and social policies. As a result, Wood’s model (1991) was broader and more comprehensive than the ones presented earlier by Carroll ( 1979 ) and Wartick and Cochran ( 1985 ), and its relevance relies on its contextualization of aspects of CSR within the business-social interaction by emphasizing explicitly the outcomes and performance of firms (Carroll 1999 ).

Also in 1991, Carroll ( 1991 ) presented the “Pyramid of Corporate Social Responsibility” with the aim of providing a useful approach to CSR for the executives that needed to balance their commitments to the shareholders with their obligations to a wider set of stakeholders which originated from the new governmental bodies and regulations of the USA, mainly from the establishment of the EPA, the Equal Employment Opportunity Commission (EEOC), the Occupational Safety and Health Administration (OSHA) and the Consumer Product Safety Commission (CPSC) (Carroll 1991 ). With the Pyramid of CSR, Carroll ( 1991 ) represented what he defined as the four main responsibilities of any company: 1) the economic responsibilities which are the foundation for the other levels of the pyramid; 2) the legal responsibilities of the firm; 3) the ethical responsibilities that shape the company’s behavior beyond the law-abiding duties, and; 4) the philanthropic responsibilities of the corporation with regards to its contribution to improve the quality of life of society. Besides the graphical representation of CSR in terms of responsibilities , Carroll ( 1991 ) asserted that a firm should be a good corporate citizen , a concept that he would develop further at the end of the 1990’s (see: Carroll 1998 ).

The third notable contribution of the 1990’s to the concept came from Burke and Logsdon ( 1996 ), who aimed to find evidence to link CSR to a positive financial performance of the firm, and by doing so they were arguably the first to evaluate the benefits of the strategic implementation of CSR. For them, CSR can be used with a strategic approach with the aim of supporting the core business activities and as a result improve the company’s effectiveness in achieving its main objectives (Burke and Logsdon 1996 ).

Moreover, Burke and Logsdon ( 1996 ) identified five dimensions of strategic CSR which, for them, are essential for achieving the business objectives as well as for value creation:1) centrality, which represents how close or fit is CSR to the company’s mission and objectives; 2) specificity, which represents the ability to gain specific benefits for the firm; 3) proactivity, in terms of being able to create policies in anticipation of social trends; 4) voluntarism, explained as the discretionary decision making process that is not influenced by external compliance requirements, and; 5) visibility, which refers to the relevance of the observable and recognizable CSR for internal and external stakeholders (Burke and Logsdon 1996 ). Furthermore, Burke and Logsdon ( 1996 ) argued that the implementation of strategic CSR through these five dimensions would translate into strategic outcome in the form of value creation that can be identifiable and measurable, but limited to economic benefits for the firm.

Another key contribution to the debate around corporate behavior came from the concept of “The Triple Bottom Line”, first conceived by Elkington in 1994 as a sustainability framework that balances the company’s social, environmental and economic impact. Later, Elkington ( 1998 ) explained that the way to achieve an outstanding triple bottom line performance (social, environmental, and economic) is through effective and long-term partnerships between the private and public sectors, and also among stakeholders. The triple bottom line concept became popular in the late 1990’s as a practical approach to sustainability and it has remained relevant in the CSR discussion because it indicates that corporations need to have socially and environmental responsible behavior that can be positively balanced with its economic goals. Footnote 4

As mentioned before, the globalization process of the 1990’s increased the global reach of multinational corporations and capitalism expanded rapidly, which meant that corporations began having concerns with regards to competitiveness, reputation, global visibility and an expanded network of stakeholders (Carroll 2015 ). This gave way to alternative subjects such as stakeholder theory (see: Donaldson and Preston 1995 ; Freeman 1994 ), corporate social performance (see: Swanson 1995 ), and corporate citizenship (see: Carroll 1998 ). The introduction of new themes, even when almost all of them were consistent with, and built on the existing CSR definitions and understanding (Carroll 1999 ), created an uncertainty with regards to the definition of CSR to the extent that the concept ended up having “unclear boundaries and debatable legitimacy” (Lantos 2001 , p. 1). This meant that by the end of the 1990’s there was a lack of a globally accepted definition of CSR (Lantos 2001 ), which was accompanied by a social and institutional impetus for making companies become good corporate citizens (see: Carroll 1998 ).

2000’s: recognition and implementation of CSR

The decade of the 2000’s is divided in two sections due to the amount of relevant events around CSR. The first section is focused on the recognition and expansion of CSR and its implementation, while the second section is focused on the strategic approach to CSR provided by the academic publications of the time.

The debate around CSR has been brought forward several times by public figures. Footnote 5 Such was the case of President Reagan who, with the aim of stimulating the economy and generating economic growth in the 1980’s, called upon the private sector for more responsible business practices and emphasized that corporations should take a leading role in social responsibility (Carroll 2015 ). During the 1990’s, it was President Clinton who brought the attention towards the notion of corporate citizenship and social responsibility with the creation of the Ron Brown Corporate Citizenship Award for companies that were good corporate citizens (Carroll 1998 ).

However, it was not until 1999 that CSR gained global attention with the landmark speech of then Secretary General of the United Nations, Kofi Annan, who at the World Economic Forum said: “I propose that you, the business leaders gathered in Davos, and we, the United Nations, initiate a global compact of shared values and principles, which will give a human face to the global market” (United Nations Global Compact n.d. , para. 5). As a result, the United Nations Global Compact (UNGC) was launched on July 2000 gathering 44 global companies, 6 business associations, and 2 labor and 12 civil society organizations (United Nations Global Compact n.d. ). Notably, the idea behind the creation of the UNGC was to create an instrument that would fill the gaps in governance of the time in terms of human rights and social and environmental issues and to insert universal values into the markets (United Nations Global Compact n.d. ).

Perhaps the most notable achievement of the UNGC was the definition of ten principles that guide the corporate behavior of its members, who are expected to incorporate them into their strategies, policies and procedures with the aim of creating a corporate culture of integrity with long term aims (United Nations Global Compact n.d. ). Even when the UNGC was never directly linked to CSR, it can be understood that the ten principles, with their focus on human rights, labor, environment, and anti-corruption, brought the global attention towards social responsibility.

It was also in the year 2000 when the United Nations adopted the Millennium Declaration with its eight Millennium Development Goals (MDGs) and set the international agenda for the following 15 years. Even when the MDGs and the debate around them was not directly linked to CSR, the United Nations Development Program (UNDP) pointed it out as a framework for the UN – private sector cooperation with the aim of achieving its goals (Murata n.d. ) and as a result the global recognition of the concept became stronger.

The promotion of CSR as a distinct European strategy begun 1 year after the adoption of the MDGs and the creation of the UNGC, when the EC presented a Green Paper called Promoting a European framework for Corporate Social Responsibility (2001) which derived from the new social expectations and concerns of the time, including the growing concern about the environmental impact of economic activities (Commission of the European Communities 2001 ). Notably, the Green Paper presented a European approach to CSR that aimed to reflect and be integrated in the broader context of international initiatives such as the UNGC (Commission of the European Communities 2001 ). This was the first step towards the European Strategy on CSR adopted in 2002 and since then, the EC has led a series of campaigns for promoting the European approach to CSR which derives from the understanding that CSR is: “the responsibility of enterprises for their impacts on society and outlines what an enterprise should do to meet that responsibility” (European Commission 2011 , para. 2).

Between 2001 and 2004 the EC held a series of conferences for discussing CSR (“What is CSR” in Brussels, “Why CSR” in Helsinki, and “How to promote and implement CSR” in Venice) which resulted in its adoption as a strategic element for the Plan of the General Direction of Business of the European Commission (Eberhard-Harribey 2006 ). Accordingly, in 2005 the EC launched the “European Roadmap for Businesses – Towards a Competitive and Sustainable Enterprise” that outlined the European objectives with regards to CSR for the following years (CSR Europe n.d. ). In practical terms, these events translated into a unified vision and understanding of CSR that would be promoted around European businesses.

In 2011, the EC published the renewed European Union (EU) strategy for CSR for the years 2011–2014 followed by a public consultation in 2014 with regards to its achievements, shortcomings, and future challenges. The 2014 consultation showed that 83% of the respondents believed that the EC should continue engaging in CSR policy and 80% thought that CSR played an important role for the sustainability of the EU economy (European Commission 2014a ). In 2015, the EC held a multi-stakeholder forum on CSR which concluded that the Commission should continue to play an important role in the promotion of CSR and help embed social responsibility into company’s strategies (European Commission 2015 ).

In 2015, CSR Europe launched the Enterprise 2020 Manifesto which aimed to set the direction of businesses in Europe and play a leading role in developing an inclusive sustainable economy (CSR Europe 2016 ) and can be understood as a response to the EU Strategy on CSR as well as to the United Nations Sustainable Development Goals. The Manifesto is perhaps the most relevant contribution from CSR Europe in the second half of the 2010’s mainly because it has a strategic approach that aims to ensure value creation for its stakeholders through the 10,000 companies reached through its network (CSR Europe 2016 ). The Manifesto focuses on the generation of value on five key areas: 1) societal impact through the promotion of responsible and sustainable business practices; 2) membership engagement and satisfaction which is meant to guarantee the continuity in the work of CSR Europe to achieve its mission and societal impact; 3) financial stability; 4) employee engagement focused on the investment of individual development as well as organizational capacity, and; 5) environmental impact assessment to determine areas of improvement (CSR Europe 2016 ).

The global recognition of CSR has also been influenced by international certifications designed to address social responsibility. Such is the case of the ISO 26000 which history can be traced to 2002 when the Committee on Consumer Policy of the International Organization for Standardization (ISO) proposed the creation of CSR guidelines to complement the quality and environmental management standards (ISO 9001 and ISO 14001) (ISO n.d.-a ). A working group led by Brazil and Sweden collaborated with stakeholders and National Standards Bodies for a period of 5 years (2005–2010) and came up with the approved ISO 26000 – Social Responsibility in September 2010 (ISO n.d.-a ).

The development of the ISO 26000 is of relevance for the CSR movement not only because it serves as a guideline for the way in which businesses can operate in a socially responsible way, but more so because it was developed by 450 experts of 99 countries and 40 international organizations and so far it has been adopted by more than 80 countries as a guideline for national standards (ISO n.d.-b , n.d.-c ).

2000’s: strategic approach to CSR

Beyond the institutional and public influence in the implementation of CSR, the 2000’s saw relevant contributions to the concept through the academic literature. In the early years of the twenty-first century, Craig Smith ( 2001 ) explained that corporate policies had changed as a response to public interest and as a result this often had a positive social impact. This meant that the scope of social responsibility (from a business perspective) was now inclusive to a broader set of stakeholders and a new definition was set forward: “Corporate social responsibility (CSR) refers to the obligations of the firm to its stakeholders – people affected by corporate policies and practices. These obligations go beyond legal requirements and the firm’s duties to its shareholders. Fulfillment of these obligations is intended to minimize any harm and maximize the long-run beneficial impact of the firm on society” (Smith 2001 , p. 142).

Smith’s definition of CSR (2001) gave hints of the need of making CSR part of a company’s strategic perspective in order to be able to fulfill its long term obligations towards society. This was reaffirmed by Lantos ( 2001 ) that same year, who pointed out that during the twenty-first century society would demand corporations to make social issues part of their strategies (see also: Carroll 1998 ).

In fact, Lantos ( 2001 ) built on from Smith’s definition of CSR and included strategic considerations to his own understanding of the concept concluding that: “CSR entails the obligation stemming from the implicit ‘social contract’ between business and society for firms to be responsive to society’s long-run needs and wants, optimizing the positive effects and minimizing the negative effects of its actions on society” (Lantos 2001 , p. 9). Accordingly, Lantos ( 2001 ) explained that CSR can become strategic when it is part of the company’s management plans for generating profits, which means that the company would take part in activities that can be understood as socially responsible only if they result in financial returns for the firm and not necessarily fulfilling a holistic approach such as the triple bottom line.

The way Lantos ( 2001 ) explained the boundaries of CSR was arguably the first time the term strategic was inherently linked to CSR. Since then, the literature on CSR begun including strategic traits to the concept and some academics (see: Husted and Allen 2007 ; Porter and Kramer 2006 ; Werther and Chandler 2005 ) begun using the term Strategic Corporate Social Responsibility (SCSR). During the early 2000’s, Freeman ( 2001 ) and A. L. Friedman and Miles ( 2002 ) provided a new perspective to stakeholder theory which reinforced the belief that corporations should be managed in the benefit of a broader set of stakeholders. Freeman ( 2001 ) argued that corporations have a responsibility towards suppliers, consumers, employees, stockholders and the local community and as a result should be managed accordingly while A. L. Friedman and Miles ( 2002 ) defined that the relation between corporations and their stakeholders is dynamic and has different levels of influence on the firm. With this new perspective, Freeman ( 2001 ) and A. L. Friedman and Miles ( 2002 ) contributed to the CSR evolution by reinforcing the belief that corporations are responsible to a broader set of stakeholder than before.

Marrewijk ( 2003 ) presented an overview of the concepts of CSR and Corporate Sustainability in which he recognized this novel perspective towards CSR. Marrewijk ( 2003 ) explained this new societal approach to CSR as a strategic response to the new corporate challenges which, as he explained, are an outcome of the evolution of the roles and responsibilities of each sector of society [emphasis added]. For Marrewijk ( 2003 ), firms respond to their challenges by adopting different levels of integration of CSR into a company’s structure, a topic that is still discussed in the literature.

Accordingly, Marrewijk ( 2003 ) gave five interpretations to his concept of Corporate Sustainability, which he recognized as the contemporary understanding of CSR. These interpretations can be understood as the level of integration of CSR into the company’s policies and structure. The holistic interpretation provided by Marrewijk ( 2003 ) is perhaps the most relevant for the purpose of this paper because it represents the full integration of CSR motivated by the search for sustainability in the understanding that companies have a new role within society and consequently have to make strategic decisions to adapt to its social context.

The strategic response that companies make to their evolving social context was further explored by Werther and Chandler ( 2005 ) who, with their first work published together, focused on the implementation of strategic CSR as part of brand management in order to achieve and maintain legitimacy in a context of globalized brands. The relevance of their work relies on the emphasis placed on the shift of social responsibility by transforming “CSR from being a minimal commitment … to becoming a strategic necessity” (Werther and Chandler 2005 , p. 319).

Furthermore, Werther and Chandler ( 2005 ) claimed that an effective integration of SCSR must come from a “genuine commitment to change and self-analysis” (p. 322) and must be done with a top-down approach throughout the company’s operations for it to translate into a sustainable competitive advantage. Even when their approach to SCSR focused mainly on the competitiveness and legitimacy of companies, their main contribution comes from explicitly claiming CSR as a strategic necessity and thus making it indispensable for any corporation.

One year afterwards, Porter and Kramer ( 2006 ) built on the notion that companies can achieve a competitive advantage through SCSR and explained that corporations can address their competitive context through a strategic approach that results in the creation of shared value in terms of benefits for society while improving the firm’s competitiveness. For Porter and Kramer ( 2006 ), a company should first look inside out to map the social impact of its value chain and identify the positive and negative effect of its activities on society and then focus on the ones with the greatest strategic value. Then, the firm should look outside in to understand the influence of their social context on their productivity and on the execution of its business strategy (Porter and Kramer 2006 ). This way, corporations would be able to understand its interrelationship with their social environment and be able to adapt its business strategies (Porter and Kramer 2006 ).

The work of Porter and Kramer ( 2006 ) provided a new understanding of SCSR as a way to maximize the interdependence between business and society through a holistic approach to the company’s operations and offered an explanation of the advantages of using SCSR as a holistic business framework instead of a limited goal-oriented perspective. In fact, Porter and Kramer ( 2006 ) argued that if CSR is used without a holistic approach and only focused on certain objectives (e.g. CSR used as a tool for achieving the social license to operate, or for achieving and maintaining a reputational status, or for addressing stakeholder satisfaction) it limits the company’s potential to create social benefits while supporting their business goals.

The notion of creating value through SCSR was reinforced by Husted and Allen ( 2007 ) who performed a survey of Spain’s largest firms by number of employees with the aim of finding out the main strategic dimensions that companies consider essential for generating value through SCSR. To do so, Husted and Allen ( 2007 ) built on four of the five dimensions of strategic CSR established by Burke and Logsdon ( 1996 ) to then provide their own definition of SCSR as the company’s ability to: “1) provide a coherent focus to a portfolio of firm resources and assets (centrality); 2) anticipate competitors in acquiring strategic factors (proactivity); 3) build reputation advantage through customer knowledge of firm behavior (visibility); 4) ensure that the added value created goes to the firm (appropriability)” (Husted and Allen 2007 , p. 596). It is important to highlight that Husted and Allen ( 2007 ) left out the concept of voluntarism proposed by Burke and Logsdon ( 1996 ) from their definition of strategic CSR but pointed out its relevance as a key dimension in CSR for the creation of value.

Based on the five dimensions of CSR established by Burke and Logsdon ( 1996 ), Husted and Allen ( 2007 ) surveyed 110 top managers of Spain’s largest companies and found out that visibility, appropriability, and voluntarism were considered the main strategic dimensions of CSR that can be linked to the creation of value (even when voluntarism is not part of their definition of SCSR). Their findings show that visibility, in terms of the presence of CSR on the media as well as a positive image of the company, can be linked to the creation of value through increased customer loyalty and the attraction of new customers, as well as developing new areas of opportunity for products and markets (Husted and Allen 2007 ). With regards to appropriability, the way in which the company manages to retain the value created, Husted and Allen ( 2007 ) pointed out that the surveyed companies designed their CSR policies with the aim of creating value, but such value seems to be limited to the economic benefits of the companies themselves and not necessarily for all their stakeholders. Finally, Husted and Allen ( 2007 ) acknowledged voluntarism, the strategic management of socially-oriented policies going beyond legal requirements, as a key aspect for the creation of value. Nevertheless, their findings show that the surveyed firms were not implementing CSR policies beyond the legal requirements which might be the consequence of the intangibility and immeasurability of such activities (Husted and Allen 2007 ).

Furthermore, the most relevant contributions provided by Husted and Allen ( 2007 ) to the concept of SCSR are twofold: first, SCSR generates new areas of opportunity through the constant drive for creating value, which in turns results in innovation. Second, implementing SCSR with the aim of creating value is inevitably linked to social demands. However, Husted and Allen ( 2007 ) pointed out that the surveyed companies looked into the generation of value with a perspective limited the economic benefits of the corporations themselves and not necessarily for all their stakeholders which raises the question if those companies were in fact implementing CSR with a holistic approach.

The belief of achieving competitive advantage and creating value through SCSR was further developed by Heslin and Ochoa ( 2008 ) who claimed that even when SCSR practices are most effective when they are tailor made, they still follow common principles. To prove their hypothesis, Heslin and Ochoa ( 2008 ) analyzed 21 exemplary CSR practices and observed that seven common principles guide the strategic CSR approach of the selected companies: cultivate the needed talent, develop new markets, protect labor welfare, reduce the environmental footprint, profit from by-products, involve customers, and green the supply chain.

The relevance of the principles proposed by Heslin and Ochoa ( 2008 ) comes from the belief that companies can improve their business opportunities while they provide benefits to the social context in which they operate. For instance, to cultivate the needed talent is explained as the need of companies to foster and retain qualified and skilled employees which result in better and more stable career opportunities (Heslin and Ochoa 2008 ). Likewise, the strategic relevance of the protection of labor welfare relies not only on the prevention of child labor but on the creation of innovative solutions for the company-specific social context Footnote 6 (Heslin and Ochoa 2008 ).

The exemplary SCSR practices presented by Heslin and Ochoa ( 2008 ) provide an insight of the potential benefits of SCSR for creating shared value, for the companies themselves, their stakeholders, and the social context in which the firms operate. Based on the work of Heslin and Ochoa ( 2008 ), it would seem that at least for some of the globally renowned companies, the belief of generating shared value became a driver for integrating global and complex issues into the company’s SCSR policies. Then, by the end of the 2000’s SCSR was understood as having the potential for generating shared value and for addressing social concerns.

2010’s: CSR and the creation of shared value

The concept of creating shared value was further developed by Porter and Kramer ( 2011 ) who explained it as a necessary step in the evolution of business and defined it as: “policies and operating practices that enhance the competitiveness of a company while simultaneously advancing the economic and social conditions in the communities in which it operates. Shared value creation focuses on identifying and expanding the connections between societal and economic progress” (Porter and Kramer 2011 , p. 2).

For Porter and Kramer ( 2011 ), the need for Creating Shared Value (CSV) is in part the result of the conventional narrow-viewed business strategies which usually don’t take into account the broad factors that influence their long term success. Notably, Porter and Kramer ( 2011 ) place CSR into this category seeing it as an outdated and limited concept that has emerged as a way for improving company’s reputation, and as a consequence, they claim that CSV should replace CSR.

Perhaps Porter and Kramer’s ( 2011 ) most relevant contribution comes from the claim that “the purpose of the corporation must be redefined as creating shared value” (p. 2) and by pointing out that the first step to do so is the identification of the societal needs as well as the benefits or harms that the business embodies through its products. Accordingly, Porter and Kramer ( 2011 ) established three ways for creating shared value: by reconceiving products and markets, by redefining productivity in the value chain, and by creating supportive industry clusters where the company operates.

Even when Porter and Kramer ( 2011 ) did not contribute directly to the concept of CSR, they called for a change in the business strategies which, in their opinion, should now focus on generating shared valued as a main objective. This perspective of the creation of shared value is evident on what Leila Trapp ( 2012 ) called the third generation of CSR, which she explained as the moment in which corporations reflect their concerns about social and global issues on their activities, even when some of those concerns might not be directly linked to their core business. Even when this might seem similar to the philanthropic responsibilities of companies, defined as the fourth level of the Pyramid of CSR proposed by Carroll ( 1991 ), it is in fact rooted on a different understanding of the roles of corporations within their social context.

For Carroll ( 1991 ), companies which engage on activities to improve the social context in which they operate are doing so with a philanthropic perspective that is discretionary and voluntary, and as a result, this perspective is less relevant than the other three categories proposed in the Pyramid of CSR. In contrast, Trapp ( 2012 ) built on the historical understanding of CSR proposed by Marrewijk ( 2003 ) to explain what she called the third generation of CSR as an outcome of the evolution of the roles and responsibilities of each sector of society in which the private, public and social sectors have become increasingly interdependent. Then, the third generation of CSR proposed by Trapp ( 2012 ) can be understood as the result of corporations acknowledging and assuming their new roles and responsibilities towards society.

Trapp ( 2012 ) exemplified the third generation of CSR through a case study of Vattenfall, the Swedish state-owned energy company that in 2008 launched a CSR-backed stakeholder engagement campaign focused on climate change mitigation. The case study showed that even when Vattenfall’s campaign addressed clear social and global issues (climate change), it still reflected typical business objectives (in this case creating an interest in the company’s environmental effort and creating a brand image linked to the fight to climate change that would be a first-mover competitive advantage) (Trapp 2012 ). With this, Trapp ( 2012 ) contributed to the concept of CSR by exemplifying the new roles and responsibilities that corporations are willing to take in order to generate shared value.

In the third edition of Chandler and Werther’s book Strategic Corporate Social Responsibility (2013), the authors acknowledged the relevance of creating shared value, a constant in the previous editions, and highlighted its significance by modifying the subtitle of the book from Stakeholders in a Global Environment to the new version Stakeholders, Globalization, and Sustainable Value Creation . In fact, in the third edition of the book Chandler and Werther ( 2013 ) claim that SCSR has the potential for generating sustainable value and that the first step to do so is by identifying the social problems for which the company can create a market-based solution in an efficient and socially responsible way.

Later, in the fourth and most recent edition of the book, Chandler ( 2016 ) reflects on the evolution of CSR and its growing acceptance as central to the company’s strategic decision making as well as to their day-to-day operations. What is evident from this edition, is that Chandler ( 2016 ) understands the generation of sustainable value as one of the main objectives of SCSR. In fact, the subtitle of the fourth edition, Sustainable Value Creation , summarizes Chandler’s ( 2016 ) new perspective on SCSR in which “value creation cannot be avoided…[instead] it must be embraced” (p. xxvii). A key aspect to point out is that Chandler ( 2016 ) builds from the work of Porter and Kramer ( 2006 ) to conclude that “the firm creates the most value when it focuses on what it does best, which is defined by its core operations” (p. 250).

A key contribution from Chandler and Werther ( 2013 ) is their definition of SCSR which is the result of their exploration of CSR and their pragmatic approach to its effective implementation. Chandler and Werther ( 2013 ) defined SCSR as: “The incorporation of a holistic CSR perspective within a firm’s strategic planning and core operations so that the firm is managed in the interests of a broad set of stakeholders to achieve maximum economic and social value over the medium to long term.” (p. 65). In the fourth edition of the book, Chandler ( 2016 ) presents a slightly modified definition which reflects his new perspective on the generation of value: “The incorporation of a holistic CSR perspective within a firm’s strategic planning and core operations so that the firm is managed in the interests of a broad set of stakeholders to optimize value [emphasis added] over the medium to long term” (Chandler 2016 , p. 248).

Perhaps Chandler and Werther’s (2006; 2010; 2013) most valuable contribution comes from their particular perspective on the implementation of Strategic CSR, which in the fourth edition of the book written by Chandler ( 2016 ) builds from the previous publications to encompass five major components instead of the four proposed in previous editions: first, the complete incorporation of the CSR perspective into the company’s strategic planning process and their corporate culture; second, the understanding that all the company’s actions are directly related to the core operations; third, the belief that companies seek to understand and be responsive to their stakeholders’ needs, which means that the incorporation of a stakeholder perspective is a strategic necessity; fourth, the company passes from a short term perspective to a mid and long term planning and management process of the firm’s resources which is inclusive of its key stakeholders, and; fifth (the new component), firms aim to optimize the value created (Chandler 2016 ; Chandler and Werther 2013 ).

The new component of SCSR, the optimization of value , reinforces Chandler’s ( 2016 ) updated perspective in which the maximization of profit, or tradeoffs, is no longer an acceptable objective. Instead, companies should aim at optimizing value over the long term by focusing on their areas of expertise and by doing so there would be a reorientation of efforts towards the creation of shared value instead of profit maximization (Chandler 2016 ). To do so, an essential aspect of SCSR is the integration of the five components into a corporate framework that sets the parameters for the decision making process as well as their integration into the corporate culture with clear guiding values (Chandler 2016 ). This reflects Chandler’s ( 2016 ) belief that SCSR should be part of the day-to-day operations in order for it to be successful, a notion constantly highlighted by him through his articles and books. Then, the explicit call for the full immersion of SCSR into a company’s corporate culture, decision making process, and day-to-day operations is yet another relevant contribution from Chandler and Werther’s work (Chandler 2016 ; Chandler and Werther 2013 ).

In 2015, Carroll resumed his work on CSR with an overview of the evolution of the concept which complemented his literature review of 1999 and of 2010 (see: Carroll 1999 ; Carroll and Shabana 2010 ), but this time he looked at the competing and complementary concepts that have become part of the modern business vocabulary. Carroll ( 2015 ) reviewed the concepts of stakeholder engagement and management, business ethics, corporate citizenship, corporate sustainability, and the creation of shared value and concluded that all of them are interrelated and overlapping. Notably, Carroll ( 2015 ) pointed out that all of these concepts have been incorporated into CSR which is the reason why he defines it as the benchmark and central piece of the socially responsible business movement (see: Chandler and Werther 2013 ; Heslin and Ochoa 2008 ; Trapp 2012 ).

The year 2015 can be considered as the most relevant in the decade because the 15 years to follow after it will be marked by the Paris Agreement, the launch of the 2030 Agenda for Sustainable Development, and the adoption of seventeen Sustainable Development Goals (SDGs) which represent a “shared vision of humanity and a social contract between the world’s leaders and the people” (Ban 2015 , para. 1). Even when the SDGs do not represent any commitments for the private sector, the countries that adopt them will have to create specific policies and regulations that will translate into pressure for firms to implement new business practices or to improve their current ones. This is particularly relevant considering that the SDGs cover a wide range of areas, from climate change to the eradication poverty and hunger, as well as the fostering of innovation and sustainable consumption. Beyond that, the SDGs are interconnected, which means that addressing one particular goal can involve tackling issues of another one (UNDP 2018 ).

Considering that the SDGs do not represent any commitments for the private sector, it is relevant to mention that the EU law, through the Directive 2014/95/EU, requires large companies of public interest (listed companies, banks, insurance companies, and other companies designated by national authorities as public-interest entities) to disclose non-financial and diversity information beginning on their 2018 reports and onwards (European Commission 2014b ; n.d. ). The Directive is of interest to this paper because it derives from the European Parlamient’s acknowledgement of the vital role of the divulgation of non-financial information within the EC’s promotion of CSR and as a result can be expected to have an impact on the expansion of CSR reporting within the EU as well as with the Global Reporting Initiative (GRI).

This context presents an opportunity for CSR and SCSR to continue growing in terms of conceptualization and implementation, mainly because businesses can adopt it as a strategic framework with the objective of creating shared value (see: Chandler 2016 ). The expansion is particularly notable within the academic literature where it is possible to see that since 2010 the number of academic publications around CSR has increased considerably (see Table  1 ). As can be seen in Table 1 , in the case of Science Direct, the publications more than doubled from 1097 in the year 2010 to 2845 in 2017 (2.59 times) while in Web of Science they almost quadrupled passing from 479 to 1816 in the same years (3.79 times). In the case of ProQuest the publications increased considerably from 2010 to 2016 passing from 5715 to 8188, but decreased to 5670 in 2017. It is also important to notice that the years 2015 and 2016 had the highest amount of publications around CSR this far. It is also relevant to observe that the number of publications declined after 2015 for Science Direct and after 2016 for Proquest, while for Web of Science the amount kept growing.

The increase in the number of publications is not necessarily linked to the launch of the SDGs, but it shows that the concept has remained relevant after the year 2015, when the Paris Agreement called for a change from business as usual to new business frameworks. A key point to mention is that looking into the newest academic publications available since 2015 it is possible to see that most of these revolve around the implementation of CSR and its impact on specific areas of performance in some way related to the SDGs but do not necessarily contribute to the definitional construct or the evolution of the concept (for example see: Benites-Lazaro and Mello-Théry 2017 ; Chuang and Huang 2016 ; Kao et al. 2018 ).

The aim of this paper is to provide a distinctive historical perspective on the evolution of CSR as a conceptual paradigm through a literature review of the academic contributions to the concept as well as the most relevant factors that have shaped its understanding and definition. As the review shows, the development of the modern understanding of CSR as a definitional construct is long and varied and can be traced as far back to the 1930’s when the debate around the social responsibilities of the private sector begun. However, it was in the 1950’s when Bowen ( 1953 ) defined what those responsibilities were by explaining that the social responsibility of business executives was to make decisions according to the values of society and provided what was perhaps the first academic definition of CSR. During the 1960’s, the academic literature brought forward a new understanding of the concept in which it acknowledged the relevance of the relationship between corporations and society (see: Davis 1960 ; Frederick 1960 ; Walton 1967 ), yet, this perspective remained limited to concerns of employee satisfaction, management and the social welfare of the community and focused mainly on the generation of economic profit.

The 1970’s were influenced by the social momentum of the time in which there was a growing sense of awareness with regards to the environment and human and labor rights which led to higher social expectations of corporate behavior. As a result, a new rationale was brought forward by the Committee for Economic Development ( 1971 ) of the USA based on the premise that the social contract between business and society was evolving and that the private sector was expected to assume broader social responsibilities than before. As a consequence, CSR became increasingly popular during the 1970’s but remained discretionary and with a limited focus on aspects such as waste management, pollution and human and labor rights. Its growing popularity led to the unrestricted use of the term CSR under different contexts and by the end of the decade the concept became unclear and meant something different for everyone.

Perhaps the first unified definition of CSR was presented in 1979 by Carroll ( 1979 ), who placed specific responsibilities and expectations (economic, legal, ethical and discretionary) upon corporations and who understood the economic and social objectives of firms as an integral part of a business framework and not as incompatible aspects. This gave way to the debate around the operationalization of CSR during the 1980’s and into the early 1990’s which brought forward a new understanding of the concept as a decision making process (see: Jones 1980 ) and was accompanied by the proposal of models and frameworks for its implementation (see: Cochran and Wood 1984 ; Strand 1983 ; Tuzzolino and Armandi 1981 ). In 1991, Carroll ( 1991 ) presented the “Pyramid of Corporate Social Responsibility” to represent what he defined as the four main responsibilities of any company and explicitly placing specific responsibilities on corporations. It was also during this period when the adoption of international agreements on sustainable development reflected, to a certain extent, a growing a sense of awareness with respect to the impact of corporate behavior (e.g. the creation of the World Commission on Environment and Development in 1983, the UN adoption of the Montreal Protocol in 1987, the creation of the IPCC in 1988, the creation of the European Environmental Agency in 1990 and the UN summit on the Environment and Development held in Rio de Janeiro which translated into the adoption of the Agenda 21 and the UNFCCC in 1992). This represented a change in the understanding of CSR and as a result, international organizations and companies alike saw CSR as a way to balance the challenges and opportunities of the time and its institutionalization begun spreading globally.

In 1996, Burke and Logsdon ( 1996 ) argued that the strategic use of CSR can result in identifiable and measurable value creation in the form of economic benefits for the firm and presented an innovative perspective that gave way to the debate around the strategic implementation of CSR during the late 1990’s. It was also during this period that alternative subjects gained attention such as stakeholder theory, corporate social performance and corporate citizenship, and even when they were consistent with the prevailing CSR understanding, their use created an uncertainty with regards to the definition of CSR and by the end of the decade the concept lacked a globally accepted definition and unclear boundaries (as explained by Lantos 2001 ).

In the year 2000, the adoption of the MDGs and the creation of the UNGC gave a new dimension to the understanding of social responsibility in which broader responsibilities were placed on corporations, mainly in terms of human and labor rights, environment, anti-corruption and sustainable development. As a result, international institutions, such as the EC, saw in CSR a pathway for addressing the new corporate challenges, which translated into a wider recognition of the concept during the first decade of the twenty-first century.

The definitions of CSR of the 2000’s reflected the belief that corporations had a new role in society in which they need to be responsive to social expectations and should be motivated by the search for sustainability, which meant they would have to make strategic decisions to do so (see: Husted and Allen 2007 ; Porter and Kramer 2006 ; Werther and Chandler 2005 ). This opened the discussion around the benefits of strategic CSR and by the early 2010’s it was believed that companies can generate shared value while improving the firm’s competitiveness through a holistic implementation of SCSR.

In the decade of the 2010’s, the Paris Agreement and the Sustainable Development Goals adopted in 2015, reflected a new social contract in which corporations are expected to play a relevant role in the global efforts to achieve the SDGs. Since then, the literature around CSR has focused on its implementation and its impact on specific areas of performance which can be linked to a certain extent to the SDGs while the understanding of CSR has remained centered on its potential to generate shared value.

At this point in the paper, it is relevant to visualize the most significant academic contributions to the evolution of Corporate Social Responsibility as a conceptual paradigm. To do so, Fig.  1 provides a chronological timeline that highlights the publications that have played a relevant role in modifying the understanding and definition of CSR. It is important to notice that the figures are based on this literature review and do not attempt to represent all the contributions to the evolution of the academic understanding of CSR but only to provide a visual synthesis.

Evolution of the academic understanding of CSR. Source: Developed by the authors as a synthesis of the academic literature

As can be seen in Fig. 1 , the social responsibilities placed upon corporations have evolved from being merely acknowledged in the early publications to being explicitly defined. Perhaps more relevant is the fact that the discussion around what those responsibilities are still continues to this day. Another key aspect that can be visualized with Fig. 1 is that the understanding of CSR evolved from being a personal decision of businessmen in the 1950’s to be understood as decision making process in the 1980’s and to be perceived as a strategic necessity by the early 2000’s. Notably, the purpose of existence of corporations has also evolved from being limited to the generation of economic profits in the 1950’s and 60’s to the belief that business exists to serve society as pointed out in the 1970’s and to the belief in the 2010’s that the purpose of corporations should be to generate shared value.

With Figs.  2 and 3 it is possible to visualize the evolution of CSR from a holistic perspective. The relevance of these figures comes from placing the events that played a significant role in shaping the understanding of CSR within the evolutionary process of the concept, some of them linked to the sustainable development agenda. This graphic synthesis of the evolutionary process of CSR is helpful for observing that the CSR understanding has been influenced by academic publications, governmental decisions (such as the creation of legislations and entities), social movements, public figures, and international movements. More so, from this graphic representation it is possible to observe that the understanding of social responsibility is dynamic and responds to social expectations of corporate behavior.

Visual history of CSR (Part 1 of 2). Source: Developed by the authors based on this literature review. Note: the size of the circles is a subjective representation of the level of influence each aspect had on the evolution of CSR. Hence, a bigger circle represents a higher level of influence

Visual history of CSR (Part 2 of 2). Source: Developed by the authors based on this literature review. Note: the size of the circles is a subjective representation of the level of influence each aspect had on the evolution of CSR. Hence, a bigger circle represents a higher level of influence

The aim of this paper was to provide a distinctive historical perspective on the evolution of CSR which was fulfilled through an exhaustive literature review that shows that the definition and concept of Corporate Social Responsibility has evolved from being limited to the generation of profits to the belief that companies should focus on generating shared value. From the review, it would seem that the evolution of the concept can be linked not only to academic contributions, but also to society’s expectations of corporate behavior. Even when this is not entirely evident across the history of the concept, there are specific cases in which the understanding of CSR clearly reflects the social expectations of the time. A notable example is the publication of A New Rationale for Corporate Social Policy and the Social Responsibilities of Business Corporations by the Committee for Economic Development ( 1971 ) of the USA which were followed by the creation of governmental institutions as a clear response to the social momentum and social demands of corporate behavior of the time. Since then, the definitions and understanding of CSR evolved for the most part in a pragmatic way according to social expectations. For example, during the 1990’s society placed broader responsibilities upon corporations when the international community adopted international agreements with regards to sustainable development and as a response, the debate around CSR centered on its strategic implementation to address the social concerns of the time but still with a limited focus on the economic benefits of the firm. In a similar way, during the early 2000’s the debate around SCSR reflected the new roles and responsibilities placed on corporations by the international community which called on the private sector to play a role in addressing the MDGs and by 2006 it was believed that SCSR could help companies achieve a competitive advantage through the creation of shared value. This belief, of creating shared value through SCSR, is perhaps the most relevant example of how the understanding of CSR reflects the social expectations of the time. The way in which Porter and Kramer ( 2011 ) proposed the creation of shared value to become the main purpose of corporations seems to be fitting to the social expectations of corporate behavior of the 2010’s as well as by those set later by the SDGs adopted in 2015.

From this review it is possible to see ties between some of the events of the sustainable development agenda and the evolution of CSR. These ties are not evident along all the history of CSR, but can be clearly seen in two specific and relevant cases, both of them cases in which events influenced the understanding and evolution of CSR: 1) In the early 1970’s the federal government of the USA established the EPA, the CPSC, the EEOC and the OSHA through which it addressed and formalized to some extent, the social and environmental responsibilities of businesses in response to the social concerns of the time. Years later, Carroll ( 1991 ) presented the Pyramid of Corporate Social Responsibility with the objective of providing business executives a pragmatic approach to their new obligations to a wider set of stakeholders, obligations that originated from the creation of the EPA, CPSC, EEOC and OSHA. It is then evident that one of the most significant contributions to the literature, Carroll’s Pyramid of CSR, was a direct response to the creation of governmental bodies and regulations, which responded to the social expectations of the time. 2) The promotion of CSR as a specific European strategy begun with the publishing in 2001 of the Green Paper called Promoting a European framework for Corporate Social Responsibility which intended to reflect the broader context of international initiatives, particularly in line with the UNGC. Then, it is clear that the UNGC had a direct influence on the Green Paper which later became the basis for the European Strategy on CSR adopted in 2002 which in turn played a role in shaping the perception and implementation of CSR in Europe. Perhaps these two examples are isolated cases in which specific international events had a direct influence on the understanding and implementation of CSR, but they show that the evolution of CSR can be influenced by international events and not only by academic contributions.

Conclusions

The theoretical contributions of this paper to the literature on CSR begin by providing a distinct historical review of the evolution of the academic understanding of the concept along with the public and international events that played a role in shaping social expectations with regards to corporate behavior. A key contribution comes from the chronological timeline established through the paper with which it is possible to observe the way the concept evolved, an aspect that can be clearly visualized through the figures presented by the authors. As a literature review, the paper is limited to the academic publications that refer directly to CSR as well as to information regarding those events that have influenced to some extents the social expectations of corporate behavior. The findings show that there is a link between social expectations of corporate behavior and the way in which CSR is understood and implemented and opens room for future research. From this review it is possible to see that the literature on CSR seems to be lacking specific research with regards to how to address the core business activities through CSR and seems to point out a reason why CSR can be implemented only partially and even may raise questions about its potential benefits. Beyond that, this paper has practical contributions that can be used as the basis for exploring how CSR can address the latest social expectations of generating shared value as a main business objective, which can translate into practical implications if CSR is implemented with the objective of creating shared value, a topic that only few authors have discussed.

Future of CSR

The amount of recent publications revolving around CSR is vast and it seems that the probable future scenario for CSR presented by Archie B. Carroll in 2015 still prevails. In this scenario Carroll ( 2015 ) foresees an increase in: stakeholder engagement, prevalence and power of ethically sensitive consumers, the level of sophistication of non-governmental organizations (NGOs), employees as a CSR driving-force, along with increased CSR activity up, down, and across the global supply chain. With regards to the concept itself, Carroll ( 2015 ) expects CSR to continue its transactional path but to have a limited transformational evolution. While this scenario seems plausible and highly probable, perhaps it would be necessary to add to it that even when CSR is still relevant and its implementation keeps expanding, at least in the literature, there are competing frameworks and new concepts that might slow the global expansion and implementation of CSR and even shift the public interest towards new areas. Some of these concepts are Corporate Sustainability, Corporate Social Performance, Creation of Shared Value, Corporate Citizenship, Environmental Corporate Social Responsibility, Environmental Social and Governance Criteria, among others. However, it is relevant to highlight Archie B. Carroll’s ( 2015 ) work on the competing and complementary frameworks of CSR in which he concluded that all of them are interrelated and overlapping and pointed out that all of these concepts have already been incorporated into CSR, which is an aspect that is sometimes overlooked. Only time will tell if the institutionalization of CSR continues to expand or if the interest shifts towards other concepts.

The future of CSR will also have to take into consideration the latest technological advances and their role as part of new business frameworks and strategies. The adoption and adaptation to new digitalization processes and tools, as well as the incorporation of Artificial Intelligence into the business environment are relevant challenges not only for the CSR debate, but for corporations in general. In this sense, business frameworks will have to adapt and evolve in order to embrace the latest tools, but they will need to do so through an overarching and holistic framework that is based on the principles of social responsibility in a way that it combines the notions of sustainability, the generation of shared value, and the belief that companies can redefine their purpose to do what is best for the world .

Chaffee ( 2017 ) goes into detail to explain the evolution of corporations under the English Crown and also their evolution in the USA where they became subject of legislatures after the Revolutionary War but still kept relatively social functions.

During the 1940’s, 50’s and 60’s, business executives and corporate managers were commonly referred to as businessmen (see Carroll 1999 ) .

The Moskowitz list is a reputation index developed during the early 1970’s by Milton Moskowitz to rate the social performance of a number of firms.

As 2018 marks 25 years since the creation of the Triple Bottom Line, Elkington ( 2018 ) reviewed the concept in the Harvard Business Review in June 2018 and concluded that there is a need for a new radical approach to sustainability that can tackle the challenges of pace and scale needed. In the same article, Elkington ( 2018 ) points out to the B Corporations (commonly known as B Corps) as an example of firms that now approach business with a dedication to do what is “best for the world” (Elkington 2018 , para. 15).

The debate around the participation of corporations in global governance has brought forward the term Corporate Political Responsibility . For example, Tempels et al. ( 2017 ), build on from the concept of corporate citizenship to argue that corporations and governments share the responsibility to tackle societal problems. Furthermore, they see corporations as responsible for helping or pushing governments to fulfill its responsibilities towards society. Another perspective comes from Djelic and Etchanchu ( 2017 ), who contextualized the political role of CSR by exploring different historical periods to conclude that corporations have played relevant social and political roles. With their historical contextualization, they argue that there is no clear separation between the responsibilities of business and state, and as a result, they consider Friedman’s ( 1962 ) approach to the CSR to be a limited a perspective that “is far from describing a natural state of things” (Djelic and Etchanchu 2017 , p. 658)

To exemplify the principle of protection of labor welfare, Heslin and Ochoa ( 2008 ) briefly present the case of Levi Strauss which was faced with the legal and social challenges of employing children under the age of 15 in Bangladesh. A solution based merely on compliance and simplicity would have been to fire all those children, but as a result of analyzing the social context, Levi Strauss observed that these children were in most cases the only way of income for their families and hence the company decided to send them to school while still paying them their regular wages and providing them with a job after completing their education (Heslin and Ochoa, 2008 ).

Abbreviations

Business for Social Responsibility

Committee for Economic Development (USA)

Consumer Product Safety Commission (USA)

Corporate Social Responsibility

Creating shared value

European Commission

Equal Employment Opportunity Commission (USA)

Environmental Protection Agency (USA)

European Union

Global Reporting Initiative

Intergovernmental Panel on Climate Change

International Organization for Standardization

Millennium Development Goals

Massachusetts Institute of Technology

Occupational Safety and Health Administration (USA)

Strategic Corporate Social Responsibility

Sustainable Development Goals

United Kingdom

United Nations

United Nations Development Programme

United Nations Framework Convention on Climate Change

United Nations Global Compact

United States of America

Young Men’s Christian Association

Aguinis, H., & Glavas, A. (2012). What we know and don’t know about corporate social responsibility: a review and research agenda. Journal of Management, 38 (4), 932–968.

Article   Google Scholar  

Avram, E., & Avasilcai, S. (2014). Business performance measurement in relation to corporate social responsibility: a conceptual model development. Procedia - Social and Behavioral Sciences, 109 , 1142–1146.

Ban, K.-M. (2015). Launch of new sustainable development agenda to guide development actions for the next 15 years. https://sustainabledevelopment.un.org/?page=view&nr=1021&type=230&menu=2059 . Accessed 16 Apr 2018.

Google Scholar  

Barnard, C. I. (1938). The functions of the executive . Cambridge: Harvard University Press.

Baumol, W. J. (1970). A new rationale for corporate social policy . USA: Heath Lexington Books.

Benites-Lazaro, L. L., & Mello-Théry, N. A. (2017). CSR as a legitimatizing tool in carbon market: Evidence from Latin America’s clean development mechanism. Journal of Cleaner Production, 149 , 218–226.

Bowen, H. R. (1953). Social responsibilities of the businessman . University of Iowa Press.

Burke, L., & Logsdon, J. M. (1996). How corporate social responsibility pays off. Long Range Planning, 29 (4), 495–502.

Business for Social Responsibility. (2018). Our Story. https://www.bsr.org/en/about/story . Accessed 2 Mar 2018.

Carroll, A. B. (1979). A three-dimensional conceptual model of corporate performance. Academy of management review, 4 (4), 497–505.

Carroll, A. B. (1991). The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders. Business Horizons, 34 (4), 39–48.

Carroll, A. B. (1998). The fousr faces of corporate citizenship. Business and Society Review, 100 (1), 1–7.

Carroll, A. B. (1999). Corporate social responsibility. Business & Society, 38 (3), 268–295.

Carroll, A. B. (2008). A history of corporate social responsibility: concepts and practices. In A. M. Andrew Crane, D. Matten, J. Moon, & D. Siegel (Eds.), The Oxford handbook of corporate social responsibility (pp. 19–46). New York: Oxford University Press.

Carroll, A. B. (2015). Corporate social responsibility: The centerpiece of competing and complementary frameworks. Organizational Dynamics, 44 (2), 87–96.

Carroll, A. B., & Shabana, K. M. (2010). The business case for corporate social responsibility: a review of concepts, research and practice. International Journal of Management Reviews, 12 (1), 85–105.

Carson, R. (1962). Silent spring . Boston, Cambridge: Houghton Mifflin, Riverside Press.

Chaffee, E. C. (2017). The origins of corporate social responsibility. University of Cincinnati Law Review, 85 , 347–373.

Chandler, D. (2016). Strategic corporate social responsibility: sustainable value creation . United States of America: SAGE Publications.

Chandler, D., & Werther, W. B. (2013). Strategic corporate social responsibility: stakeholders, globalization, and sustainable value creation (3rd ed.). United States of America: SAGE Publications.

Chuang, S.-P., & Huang, S.-J. (2016). The effect of environmental corporate social responsibility on environmental performance and business competitiveness: the mediation of green information technology capital. Journal of Business Ethics , Springer, 150 (4), 991–1009.

Clark, J. M. (1939). Social control of business (2nd ed.). United States of America: Augustus M Kelley Pubs.

Cochran, P. L., & Wood, R. A. (1984). Corporate social responsibility and financial performance. The Academy of Management Journal, 27 (1), 42–56.

Commission of the European Communities. (2001). Green paper: promoting a European framework for corporate social responsibility (COM(2001) 366 final) . Brussels: E. Commission.

Committee for Economic Development. (1971). Social responsibilities of business corporations . USA: Committee for Economic Development.

Crane, A. (2008). The Oxford handbook of corporate social responsibility . Oxford: OUP.

CSR Europe. (2016). CSR Europe report 2016 .

CSR Europe. (n.d.). CSR Europe - 20 years of business-policy interaction driving the CSR movement. https://www.csreurope.org/history . Accessed 19 Mar 2018.

Dahlsrud, A. (2008). How corporate social responsibility is defined: An analysis of 37 definitions. Corporate Social Responsibility and Environmental Management, 15 (1), 1–13.

Davis, K. (1960). Can business afford to ignore social responsibilities? California Management Review, 2 (3), 70–76.

Davis, K. (1973). The case for and against business assumption of social responsibilities. Academy of Management Journal, 16 (2), 312–322.

Djelic, M.-L., & Etchanchu, H. (2017). Contextualizing corporate political responsibilities: neoliberal CSR in historical perspective. Journal of Business Ethics, 142 (4), 641–661.

Donaldson, T., & Preston, L. E. (1995). The stakeholder theory of the corporation: concepts, evidence, and implications. The Academy of Management Review, 20 (1), 65–91.

Du Pisani, J. A. (2006). Sustainable development – historical roots of the concept. Environmental Sciences, 3 (2), 83–96.

Earth Day. (2018). The history of earth day. https://www.earthday.org/about/the-history-of-earth-day/ . Accessed 25 May 2018.

Eberhard-Harribey, L. (2006). Corporate social responsibility as a new paradigm in the European policy: how CSR comes to legitimate the European regulation process. Corporate Governance: The international journal of business in society, 6 (4), 358–368.

Eells, R. S. F. (1956). Corporation giving in a free society . New York: Harper.

Ehrlich, P. R. (1968). The population bomb . New York: Ballantine Books.

Elkington, J. (1998). Partnerships from cannibals with forks: The triple bottom line of 21st-century business. Environmental Quality Management, 8 (1), 37–51.

Elkington, J. (2018). 25 years ago I coined the phrase “triple bottom line.” Here’s why it’s time to rethink it. Harvard Business Review.

European Commission. (2011). Corporate social responsibility: a new definition, a new agenda for action. (MEMO/11/732, MEMO/11/734 and MEMO/11/735) . European Commission Retrieved from http://europa.eu/rapid/press-release_MEMO-11-730_en.htm .

European Commission. (2014a). The corporate social responsibility strategy of the European commission: results of the public consultation . Brussels: E. Commission.

European Commission. (2014b). Directive 2014/95/EU of the European parliament and of the council. https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32014L0095 . Accessed 20 June 2018.

European Commission. (2015). EU multi stakeholder forum on corporate social responsibility (Ares(2015)580495) . Brussels: E. Commission.

European Commission. (n.d.). Non-financial reporting. https://ec.europa.eu/info/business-economy-euro/company-reporting-and-auditing/company-reporting/non-financial-reporting_en . Accessed 20 June 2018.

Feldstein, M. (2013). The Reagan-Thatcher revolution. https://www.dw.com/en/the-reagan-thatcher-revolution/a-16732731 . Accessed 9 Nov 2018.

Fink, A. (2005). Conducting research literature reviews: from the internet to paper . United States of America: SAGE Publications.

Frederick, W. C. (1960). The growing concern over business responsibility. California Management Review, 2 (4), 54–61.

Freeman, R. E. (1994). The politics of stakeholder theory: Some future directions. Business ethics quarterly , 4 (4), 409–421.

Freeman, R. E. (2001). A stakeholder theory of the modern corporation. Perspectives in Business Ethics Sie, 3 , 144.

Friedman, A. L., & Miles, S. (2002). Developing stakeholder theory. Journal of management studies, 39 (1), 1–21.

Friedman, M. (1962). Capitalism and freedom . United States of America: University of Chicago Press.

Friedman, M. (1970). The social responsibility of business is to increase its profits . The New York Times Magazine.

Harrison, B. (1966). Philanthropy and the Victorians. Victorian Studies, 9 (4), 353–374.

Heald, M. (1970). The social responsibilities of business: company and community 1900–1960 . United States of America: Pr. of Case Western Reserve Univ.

Heslin, P. A., & Ochoa, J. D. (2008). Understanding and developing strategic corporate social responsibility. Organizational Dynamics, 37 (2), 125–144.

Husted, B. W., & Allen, D. B. (2007). Strategic corporate social responsibility and value creation among large firms: Lessons from the Spanish experience. Long Range Planning, 40 (6), 594–610.

ISO. (n.d.-a). History of ISO 26000. http://iso26000.info/history/ . Accessed 17 May 2018.

ISO. (n.d.-b). ISO 26000 - social responsibility. https://www.iso.org/iso-26000-social-responsibility.html . Accessed 17 May 2018.

ISO. (n.d.-c). ISO 26000 guidance on social responsibility. http://iso26000.info /. Accessed 17 May 2018.

Jamali, D., & Carroll, A. B. (2017). Capturing advances in CSR: Developed versus developing country perspectives. Business Ethics A European Review, 26 , 321–325.

Jones, T. M. (1980). Corporate social responsibility revisited, redefined. California Management Review, 22 (3), 59–67.

Kao, E. H., Yeh, C.-C., Wang, L.-H., & Fung, H.-G. (2018). The relationship between CSR and performance: Evidence in China. Pacific-Basin Finance Journal.

Lantos, G. P. (2001). The boundaries of strategic corporate social responsibility. Journal of Consumer Marketing , 18 (7), 595–632.

Latapí, M. A. (2017). Strategic Corporate Social Responsibility in the Container Shipping Industry: A Case Study of the Triple E as part of Maersk's Sustainability Strategy . Unpublished Master Thesis Faculty of Business Administration. University of Iceland. Reykjavik, Iceland.

Lee, M.-D. P. (2008). A review of the theories of corporate social responsibility: Its evolutionary path and the road ahead. International Journal of Management Reviews, 10 (1), 53–73.

Mahoney, J. T., & Godfrey, P. (2014). The Functions of the Executive at 75: An Invitation to Reconsider a Timeless Classic http://business.illinois.edu/working_papers/papers/14-0100.pdf Accessed 21 Apr 2018.

Marrewijk, M. (2003). Concepts and Definitions of CSR and Corporate Sustainability: Between Agency and Communion (Vol. 44).

McGuire, J. W. (1963). Business and society . New York: McGraw-hill.

McWilliams, A., & Siegel, D. (2001). Corporate social responsibility: A theory of the firm perspective. The Academy of Management Review, 26 (1), 117–127.

Murata, S. i. (n.d.). Corporate Social Responsibility (CSR) and Millennium Development Goals (MDGs). http://siteresources.worldbank.org/INTJAPANINJAPANESE/Resources/515610-1138006557271/Mr.Murata-English.pdf . Accessed 29 May 2018.

Okoli, C., & Schabram, K. (2010). A guide to conducting a systematic literature review of information systems research .

Book   Google Scholar  

Pillay, R. (2015). The changing nature of corporate social responsibility: CSR and development – the case of Mauritius . New York: Taylor & Francis.

Porter, M. E., & Kramer, M. R. (2006). Strategy & Society. Harvard Business Review, December, 1–16 .

Porter, M. E., & Kramer, M. R. (2011). Creating shared value. Harvard Business Review (January-February).

Preston, L. E., & Post, J. E. (1975). In S. U. Press (Ed.), Private management and public policy: the principle of public responsibility . United States of America: Pearson Education Inc..

Selekman, B. M. (1959). A moral philosophy for management . United States of America: McGraw-Hill.

Sethi, S. P. (1975). Dimensions of corporate social performance: An analytical framework. California Management Review, 17 (3), 58–64.

Smith, N. C. (2001). Changes in corporate practices in response to public interest advocacy and actions. In P. N. B. a. G. T. Gundlach (Ed.), Handbook of Marketing and Society . Thousand Oaks.

Strand, R. (1983). A systems paradigm of organizational adaptations to the social environment. Academy of management review, 8 (1), 90–96.

Swanson, D. L. (1995). Addressing a theoretical problem by reorienting the corporate social performance model. The Academy of Management Review, 20 (1), 43–64.

Tempels, T., Blok, V., & Verweij, M. (2017). Understanding political responsibility in corporate citizenship: Towards a shared responsibility for the common good. Journal of Global Ethics, 13 (1), 90–108.

The Club of Rome. (2018). History. https://www.clubofrome.org/about-us/history/ . Accessed 28 May 2018.

Trapp, N. L. (2012). Corporation as climate ambassador: Transcending business sector boundaries in a Swedish CSR campaign. Public Relations Review, 38 (3), 458–465.

Tuzzolino, F., & Armandi, B. R. (1981). A need-hierarchy framework for assessing corporate social responsibility. The Academy of Management Review, 6 (1), 21–28.

UNDP. (2018). What are the Sustainable Development Goals? http://www.undp.org/content/undp/en/home/sustainable-development-goals.html . Accessed 18 Apr 2018.

Union of Concerned Scientists. (2017). The IPCC: who are they and why do their climate reports matter? https://ucsusa.org/global-warming/science-and-impacts/science/ipcc-backgrounder.html #. Accessed 25 June 2018.

United Nations Global Compact. (n.d.). UN History - A giant opens up. http://globalcompact15.org/report/part-i/un-history-a-giant-opens-up . Accessed 28 May 2018.

Votaw, D. (1973). Genius becomes rare: a comment on the doctrine of social responsibility Pt. II. California Management Review, 15 (3), 5–19.

Walton, C. C. (1967). Corporate social responsibilities . United States of America: Wadsworth Publishing Company.

Walton, C. C. (1982). Corporate social responsibility: The debate revisited. Journal of Economics and Business, 34 (2), 173–187.

Wankel, C. (2008). 21st century management: a reference handbook . United States of America: SAGE Publications.

Wartick, S. L., & Cochran, P. L. (1985). The evolution of the corporate social performance model. Academy of Management Review, 10 (4), 758–769.

Waterhouse, B. C. (2017). The personal, the political and the profitable: Business and protest culture, 1960s-1980s. Financial History, Spring, 2017 , 14–17.

Werther, W. B., & Chandler, D. (2005). Strategic corporate social responsibility as global brand insurance. Business Horizons, 48 (4), 317–324.

Wood, D. J. (1991). Corporate social performance revisited. The Academy of Management Review, 16 (4), 691–718.

World Watch Institute. (n.d.). Environmental Milestones. http://www.worldwatch.org/brain/features/timeline/timeline.htm. Accessed 28 May 2018.

Download references

Acknowledgements

First, we want to thank the two anonymous reviewers for their comments and suggestions which were fundamental for the final version of this article. We also want to thank the editors for their assistance throughout the review process.

We are grateful and acknowledge that this research was made possible by the support of the Mexican National Council for Science and Technology (CONACYT for its abbreviation in Spanish) which granted a 36 month scholarship to ML to conduct his PhD at the University of Iceland.

Availability of data and materials

The data that support the findings of Table 1 is available from the three online data bases consulted (Science Direct, ProQuest and Web of Science) according to the considerations mentioned for the creation of the table. The rest of the data generated or analyzed during this study is included in this published article.

Author information

Authors and affiliations.

University of Iceland, Reykjavik, Iceland

Mauricio Andrés Latapí Agudelo, Lára Jóhannsdóttir & Brynhildur Davídsdóttir

You can also search for this author in PubMed   Google Scholar

Contributions

This paper is derived from ML’s work towards a PhD in Environment and Natural Resources at the University of Iceland. As such, ML performed a literature review of the history and evolution of CSR. Dr. LJ being the main advisor for ML’s PhD and Dr. BD being the secondary advisor, contributed by guiding the direction of the article through comments, suggestions, information and literature and by contributing in the drafting and revising the work to achieve the academic quality required for a PhD at the University of Iceland. Dr. LJ has provided the overall review. All authors read and approved the final manuscript.

Corresponding author

Correspondence to Mauricio Andrés Latapí Agudelo .

Ethics declarations

Authors’ information.

ML is a PhD student in the Environment and Natural Resources graduate program at the University of Iceland. His current research focuses on the impact of SCSR on the energy sector, in particular on the energy efficiency and environmental performance of energy companies.

Dr. LJ is a professor at the Faculty of Business Administration at the University of Iceland. LJ has published in the areas of CSR, sustainable business models and environmental sustainability. Among her activities, LJ is a Fulbright Arctic Initiative Scholar.

Dr. BD is a professor of Environment and Natural Resources in the Faculties of Life and Environmental Sciences and Economics at the University of Iceland. BD has published in areas of sustainable energy, sustainable development and ecological economics. Among her occupations, BD is the book review editor for the journal Ecological Economics, Director of the University of Iceland Arctic Initiative and sits on the boards of several foundations, institutes and private companies.

Competing interests

The authors declare that they have no competing interests.

Publisher’s Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Recommended readings

After having done an exhaustive literature review on CSR and its evolution it has been a challenge to select which contributions should be left out of this paper. With this in mind, we would like to bring the attention of the reader towards the following publications: The Functions of the Executive by Barnard ( 1938 ) along with The Functions of the Executive at 75: An Invitation to Reconsider a Timeless Classic by Mahoney and Godfrey ( 2014 ); the Social Control of Business by Clark ( 1939 ); the Social responsibilities of business corporations published by the Committee for Economic Development ( 1971 ); the Green Paper: Promoting a European framework for Corporate Social Responsibility published by the Commission of the European Communities ( 2001 ) which was the first step towards the European Strategy for CSR; Corporate Social Responsibility: A Theory of the Firm Perspective by McWilliams and Siegel ( 2001 ); the search for a definition of CSR by Dahlsrud ( 2008 ) with How corporate social responsibility is defined: an analysis of 37 definitions ; then The Oxford Handbook of Corporate Social Responsibility by Crane ( 2008 ) which provides a summary of CSR history and points out relevant contributions to the concept; the literature review and analysis of the institutional, organizational, and individual levels of CSR provided by Aguinis and Glavas ( 2012 ) with What We Know and Don’t Know About Corporate Social Responsibility: A Review and Research Agenda ; the case study of reporting initiatives from a CSR perspective presented by Avram and Avasilcai ( 2014 ) through their Business Performance Measurement in Relation to Corporate Social Responsibility: A conceptual Model Development ; the internal and external drivers behind SCSR rationale for the maritime transportation sector presented by Latapí ( 2017 ) in his unpublished master thesis; and, Capturing advances in CSR: Developed versus developing country perspectives by Jamali and Carroll ( 2017 ).

Rights and permissions

Open Access This article is distributed under the terms of the Creative Commons Attribution 4.0 International License ( http://creativecommons.org/licenses/by/4.0/ ), which permits unrestricted use, distribution, and reproduction in any medium, provided you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license, and indicate if changes were made.

Reprints and permissions

About this article

Cite this article.

Latapí Agudelo, M.A., Jóhannsdóttir, L. & Davídsdóttir, B. A literature review of the history and evolution of corporate social responsibility. Int J Corporate Soc Responsibility 4 , 1 (2019). https://doi.org/10.1186/s40991-018-0039-y

Download citation

Received : 07 September 2018

Accepted : 18 December 2018

Published : 22 January 2019

DOI : https://doi.org/10.1186/s40991-018-0039-y

Share this article

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative

• Corporate social responsibility
• CSR evolution
• CSR history
• Sustainable development
• Generation of shared value
• Social responsibility
• Corporate behavior

Browse Econ Literature

• Working papers
• Software components
• Book chapters
• JEL classification

More features

• Subscribe to new research

RePEc Biblio

Author registration.

• Economics Virtual Seminar Calendar NEW!

Corporate Social Responsibility And Companies’ Reputation

• Author & abstract
• 4 Citations
• Related works & more

Corrections

(Department of Economics, INSUBRIA University, Varese, Italy)

• Patrizia Gazzola

Suggested Citation

Download full text from publisher.

Follow serials, authors, keywords & more

Public profiles for Economics researchers

Various research rankings in Economics

RePEc Genealogy

Who was a student of whom, using RePEc

Curated articles & papers on economics topics

Upload your paper to be listed on RePEc and IDEAS

New papers by email

Subscribe to new additions to RePEc

EconAcademics

Blog aggregator for economics research

Cases of plagiarism in Economics

About RePEc

Initiative for open bibliographies in Economics

News about RePEc

Questions about IDEAS and RePEc

RePEc volunteers

Participating archives

Publishers indexing in RePEc

Privacy statement

Found an error or omission?

Opportunities to help RePEc

Get papers listed

Have your research listed on RePEc

Open a RePEc archive

Have your institution's/publisher's output listed on RePEc

Get RePEc data

Use data assembled by RePEc