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Corporate Social Responsibility

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DOI: 10.1007/978-3-319-95726-5_26

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Reference:

Riano, J.C. and Yakovleva, N. (2019) Corporate Social Responsibility. In: Walter Leal Filho,
Anabela Marisa Azul, Luciana Brandli, Pinar Gökcin Özuyar, Tony Wall (Eds) Responsible
Consumption and Production. Encyclopaedia of the UN Sustainable Development Goals Book
Series. Springer, Switzerland.

Corporate Social Responsibility

Julian D. Riano and Natalia Yakovleva

Newcastle University London, Newcastle University Business School, London, UK

Definitions

Corporate social responsibility is a responsibility of for-profit and not-for-profit organizations

for their impact on stakeholders, natural environment, and wider society; it focuses on
accountability and transparency of corporate actions that include social, ethical, environmental,
and economic efforts, which are often voluntary and placed within and outside of market and
commercial transactions. The World Business Council for Sustainable Development defines
corporate social responsibility as the “continuing commitment by business to behave ethically
and contribute to economic development while improving the quality of life of the workforce,
their families as well as of the local community and society at large” (WBCSD 2000, p. 10).
Organization for Economic Co-operation and Development (OECD) views corporate social
responsibility as the “Business contribution to sustainable development.” Consequently,
corporate behavior must not only ensure returns to shareholders, wages to employees, and
products and services to consumers, but they must respond to the societal and environmental
concerns and values (OECD 2001, p. 13). Finally, the CEC (2002, p. 5) defines: CSR is
behaviour by business over and above legal requirements, voluntarily adopted. Business need
to integrate the economic, social and environmental impact in their operations. CSR is not an
optional “add-on” to business core activities, but about the way in which businesses are
managed.
Origin of Corporate Social Responsibility

The concept of corporate social responsibility (CSR) was born in discussions about the role of
business in society (Bowen 1953; Carroll 1979, 1989; Davis 1973; Friedman 1970; Johnson
1971). It rose from societal concerns about negative outcomes of business operations such as
child labour, poor working conditions, unpaid overtime, and environmental degradation
(Blowfield and Murray 2014). Currently, it is widely used to define non-commercial relations
between corporations with other social actors and society at large. It is often used with
reference to for-profit organizations (e.g., commercial enterprises, businesses, corporations
with other social actors and society at large. It is often used with reference to for-profit
organizations (e.g., commercial enterprises, businesses, corporations, firms, and companies)
but can also be applied to non-for-profit organizations such as government departments,
municipal organizations, non-governmental organizations, and social enterprises (EC 2011;
GRI 2013).

Ethical behavior is an important part of CSR, where businesses are encouraged to follow not
only commercial logic but also behave in accordance with accepted societal norms and adopt
ethical code of conduct (WBCSD 2000; Crane and Matten 2015). CSR stretches beyond legal
responsibilities laid down in national laws that regulate corporate behavior and encourages
business to go beyond legal compliance to follow objectives and values of the society
embedded in political, economic, and institutional contexts and respond to changing societal
concerns (Bowen 1953; Carroll 1999; CEC 2001, 2006; Matten and Moon 2005; Crane et al.
2008). CSR as a voluntary action is not imposed by law, and it includes corporate actions that
are beyond responsibilities to shareholders to reach customers, employees, suppliers, and
communities (Jones 1980).

Carroll (1979, 1991) suggested that CSR of a firm is formed by four kinds of social
responsibility – economic, legal, ethical, and discretionary or philanthropic, which are arranged
in a shape of pyramid. CSR pyramid begins with economic responsibility as a core rationale
and main role of business in society to produce goods and services that consumers need and
want and to make acceptable profit (Carroll 1979, 1991). The next level up is legal
responsibility as business ought to “comply with the laws and regulations promulgated by
federal, state and local governments” (Carroll 1991, p. 41). The third level up is ethical
responsibility that describes “those activities and practices that are expected or prohibited by
societal members even though they are not codified into law” (Carroll 1991, p. 41). The apex
of the pyramid is philanthropic responsibility that specifies “corporate actions that are in
response to society’s expectation that businesses be good corporate citizens” (Carroll 1991,
p. 42). Acknowledging the relevance of CSR in developing country context, Visser (2008)
proposed different sequence of CSR pyramid for developing countries, beginning with
economic responsibility at the foundation, followed by philanthropic, legal, and ethical
responsibilities. Other authors include environ- mental responsibility as a separate layer in the
CSR pyramid in developing countries (Yakovleva and Vazquez-Brust 2012). Further- more, a
content analysis of CSR definitions reveals five dimensions of corporate social responsibility:
stakeholder, social, economic, voluntary, and environmental (Dahlsrud 2008).

An integral part of CSR is stakeholder engagement. Stakeholders are groups and individuals
with significant interest in operations and success of an organization, and without those support
the organization will cease to exist (Freeman 1984, 1994). Freeman (1984, p. 46) defined stake-
holders as “any group or individual who can affect or is affected by the achievement of the
organization’s objectives.” Stakeholders are seen to benefit or be harmed by corporate actions,
and their rights can be respected or violated by businesses (Evan and Freeman 1988). Thus,
organizations responsible to their stakeholders could be customers, employees, managers,
shareholders, governments, and nongovernmental organizations (Crane et al. 2008; Dunfee
2008; Donaldson and Preston 1995). Stakeholder theory suggests that success and survival of
a corporation and its continued profitability are supported by managerial skill to fulfill
economic and social purpose and ensure satisfaction of stakeholder demands (Clarkson 1995).
Stakeholders have diverse interests in corporate actions but have varying capacities to influence
corporate decision-making. The extent to which an organization considers stakeholder
concerns in decision-making depends on stakeholder salience or a degree to which managers
give priority to competing stakeholder claims (Mitchell et al. 1997). Stakeholder salience has
three important attributes: (a) legitimacy or stakeholder relationship with the firm, defined as
a “generalized perception or assumption that the actions of an entity are desirable, proper, or
appropriate within a system of norms, values, beliefs, definitions”; (b) power or ability to
influence the firm, defined as a “relationship among social actors in which one social actor, A,
can get definitions”; (b) power or ability to influence the firm, defined as a “relationship among
social actors in which one social actor, A, can get another social actor, B, to do something
that B would not have otherwise done”; and (c) urgency or criticality to the firm, defined as a
“degree to which stakeholder claims call for immediate action” (Mitchell et al. 1997, p. 869).

Motivations of organizations to engage in CSR can be interpreted through several perspectives:

commercial or business case for CSR, where organizations reap commercial value and
competitive advantage through corporate social activities (this includes corporate
philanthropy) (Franklin 2008; Griffin and Mahon 1997); risk management, where
organizations mitigate environmental and social risks such as environmental disasters, child
labour, and public scandals (Franklin 2008); and ethical, where organizations are obliged to
follow societal norms and pressures from stakeholders (Crane and Matten 2015; Windsor
2006). External pressures for CSR include stakeholder activism, proliferation of voluntary
social, ethical, and environmental standards (Jenkins 2005; Kaufman et al. 2004); investment
incentives from banks and lending organizations (Wright and Rwabizambuga 2006); supply
chain and peer pressures to improve social and environmental outcomes of business operations
(Blowfield 2003); and legal regulation on human rights, child labour, and environmental
protection (Kaufman et al. 2004).

The interest to regulate corporate behavior at international level originates from concerns over
conduct of multinational corporations (MNCs), primarily in developing countries (Visser
2008). International regulation and enforcement of CSR aimed at MNCs are minimal in some
countries or nonexistent (Williams and Aguilera 2008). Many voluntary standards developed
for business con- duct encourage MNCs to adopt sustainability principles and engage in
partnerships with public and non-for-profit sector organizations. Among drivers for MNCs to
implement CSR activities in developing countries, Visser (2008) counts cultural traditions,
political reforms, socioeconomic priorities of developing countries, governance gaps, crisis
response, and market access.

Adoption of CSR action in corporate strategies produces a variety of organizational benefits

such as adaptation to volatile business environments, enhanced corporate governance, strong
support of business networks, development of partnerships and coalitions, and building of trust
with suppliers, distributors, communities, nongovernmental organizations, government
agencies, and trade associations. CSR activities have direct and indirect correlation with
organizational financial and management performance by reducing employee turnover and
supporting employee retention, increasing organizational reputation, generating greater
consumer value and brand loyalty, and enhancing managerial experience and knowledge
(Hansen et al. 2011; Kaufman et al. 2004; Williams and Aguilera 2008).

Approaches to CSR

Aside from the CSR pyramid, a leading paradigm of CSR developed by Carroll (1991), which
demonstrated a continued acceptance in the management literature (Burton and Goldsby 2009;
Schwartz and Carroll 2003; Spence 2016), other perspectives on the role of business in the
society exist. These include the concepts of corporate citizenship (Matten and Crane 2005),
corporate social responsiveness (Clarkson 1995; Wartick and Cochran 1985), corporate social
performance (Wood 1991a, 199b), CSR as competitive advantage (Porter and Kramer 2011;
Laszlo and Zhexembayeva 2011), and political CSR (Scherer and Palazzo 2011).

Corporate Citizenship

Corporate citizenship views corporations as societal institutions with a status of a legal person
or citizen with rights and responsibilities that were advanced by Matten and Crane (2005, p.
174) who suggested that when governmental actors fail to safeguard citizens’ rights,
corporations are expected to take part in “protection, facilitation and enabling of citizens’
rights – formerly an expectation placed solely on governments.” Matten and Crane (2005)
suggest that the social role of corporations is to administer citizen’s rights by providing social
citizen’s rights by providing social rights of access to education, health care, and welfare
services, enabling civil rights such as freedom from abuses and rights to own property and
exercise freedom of speech and engage in free markets, and channeling political rights of
participating in societal matters through rights to vote, hold, and office and participate in
collective and public institutions.

Corporate Social Responsiveness

Corporate social responsiveness shifts the focus from philosophical view of social obligations
to tangible social response processes (Wartick and Cochran 1985). Social responsiveness
“refers to capacity of corporations to respond to social pressures” (Frederick 1978, p. 6) and
was incorporated in Carroll (1979) three-dimensional model of CSR involving social
responsiveness (Wartick and Cochran 1985) along with social responsibility dimensions
(economic, legal, ethical, and discretionary) and social issues such as environment,
discrimination, and product safety. Wartick and Cochran (1985) advocate for the adoption of
social responsiveness to attend to short- and medium-term goals of corporations and set
achievable objectives that can be used by man- agers to focus on the implementation and policy
development. Social responsiveness is an action- oriented compliment to CSR and the
underlying approach to the development of corporate responses to social issues, where CSR is
a macro view of business and society relations, whereas social responsiveness provides a micro
emphasis on pragmatic firm responses to societal concerns in medium and short term.
Corporate social responsiveness focuses on institutional processes taking guises of reactive,
doing less that required; defensive, doing the least that is required; accommodative, doing all
that is required; and proactive, doing more than required (Wartick and Cochran 1985). Social
responsiveness is followed by social issue management that identifies and analyzes issues and
develops corporate policy responses (Wartick and Cochran 1985). Further advice on how to
implement CSR in businesses is provided by authors prescribing stages or phases for CSR in
business strategy development from inclusion into corporate mission to implementation of
activities; their assessment; monitoring, measuring, and reporting; and strategic review cycles
(Grayson and Hodges 2004; Stainer 2006).

Corporate Social Performance

Traditionally, corporate success is assessed by the creation and increase of value for
shareholders in a form of profit rather than a value for stake- holders. The first attempt to
address the management of social issues in corporations was the Corporate Social Response
matrix, developed by Preston in 1977, which assessed corporate actions in four stages:
awareness or recognition of an issues, analysis and planning, response in terms of policy
development and implementation (Clarkson 1995). Notion of corporate social performance
(CSP) was advanced by Donna Wood who introduced a framework to examine principles of
social responsibility in business organization, processes, policies, programs, and outcomes of
corporation actions (Wood 1991a). The purpose of CSP is to change and enhance corporate
behavior with improved beneficial outcomes for the society (Wood 1991b). CSP model
promoted by Wood (1991a) comprises of three levels that include (a) principles of CSR,
processes of corporate social responsiveness, and outcomes of corporate behavior; (b)
processes of corporate social responsiveness, which included the environmental assessment,
stakeholder management, and issue management; and (c) outcomes of corporate behavior
covering social impacts, programs, and policies.

CSR as Competitive Advantage

The link between CSR and competitive advantage of a firm has been explored by Porter and
Kramer (2006, 2011), who suggest that companies and society can reap mutual benefits through
a concept of “shared value,” when companies generate competitive advantage such as
enhanced reputation with communities, suppliers, and interest groups and creation of business
opportunities through CSR activities and tackling social problems. Further, Laszlo and
Zhexembayeva (2011) argue that companies who produce stakeholder value can generate
competitive advantage through the process of “embedded sustainability” or incorporation of
environmental and social values at the core of business operations. Instead of bolting CSR
activities on existing business operations, Laszlo and Zhexembayeva (2011) suggest that
companies must acknowledge the economic, social, and environmental consequences of their
operations and develop strategies that are not optional or additional to core business activities
but instead a way of managing modern business. Companies can embed sustainability through
innovative design of products and services, inquiry and appreciation or reflecting upon
experiences, learning and spreading cooperative strategy in business, and wholeness or systems
thinking. Falkenberg and Brunsæl (2011) believe that when organizations engage in CSR
activities and produce economic advantage, this could prompt competitors to engage in similar
CSR activities, thus making CSR activities no longer a competitive advantage but rather a
strategic necessity.

Political CSR

In the context of globalization, as reviewed by Scherer and Palazzo (2011), the sphere of
influence and division of activities between private business and national governments is
changing, especially given regulatory gaps and responsibility of businesses to go beyond the
law. Given the multi-stakeholder nature of current global governance with increased political
pressures from non- governmental organizations on businesses and national governments, a
new form of political CSR emerges. It moves away from the existing instrumental view of
CSR, which seeks to establish a business case for the CSR activities (Scherer and Palazzo
2011). Instead, political CSR recognizes “extended model of governance with business firms
contributing to global reputation and providing public goods…where corporations and civil
society organisations play an active role in the democratic regulation and control of market
transactions” (Scherer and Palazzo 2011, p. 901). Scherer and Palazzo (2011) detail a move
toward political CSR as characterized by several processes such as (a) changing global
institutional context for CSR and a shift from national to global governance, (b) changing
nature of CSR self-regulation from hard to soft law, (c) changing scope of CSR from legal
liabilities to social connectedness, (d) changing conditions of corporate legitimacy from
pragmatic to moral legitimacy, and (e) changing foundations of CSR from liberal to
deliberative democracy.

CSR and Sustainable Development

CSR is considered to be a way for companies to integrate the principles and goals of sustain-
able development in business operations (OECD 2001; Rainey 2006; Crane et al. 2008;
Blowfield and Murray 2014). Following the release of Brundtland report “Out Common
Future” (WCED 1987), Rio Declaration and Agenda 21 at the Earth Summit in 1992 (UNCED
1992), the responsibility for achieving sustainable development has been also placed with
business and industry. In 1994, Elkington and his company SustainAbility introduced a concept
of triple bot- tom line, aimed at increasing corporate awareness of the importance of generating
social and environmental value along with economic value and interpreting sustainable
development dimensions within the business, described as “people, planet and profits”
(Elkington 2004). Elkington (2004) argues that triple bottom line forms a new paradigm for
business focusing on competition, introducing new values, transparency, and opening
information about corporate operations to the public, encouraging promotion of social and
environmental performance and stakeholder-oriented business development and partnerships
between the sectors of society. Currently, corporate accountability for social, environmental,
and eco- nomic aspects of business operations under the triple bottom line accounting has
become an integral part of CSR (Waddock et al. 2002). Many large businesses adopt CSR
reporting using the guidelines developed by the Global Reporting Initiative (GRI 2013).

In 1999, the UN-proposed Global Compact, a voluntary initiative aimed at businesses to

integrate ten principles of human rights, labour, environment, and anti-corruption, was
developed on the basis of Sullivan principles. Sullivan principles were composed in partnership
between the UN Secretary General Kofi Annan and Reverend Leon Sullivan earlier in 1999
that focus on support of universal human rights, equal opportunities, respect for freedom of
association, employee compensation, training, health and safety, sustainable development, fair
competition, and improvement of quality of life, these were voluntarily adopted by companies
doing business in South Africa (UN 2018).

At the Rio+20 Conference in 2012, member states agreed upon the creation of Sustainable
Development Goals (SDGs) to follow the legacy of Millennium Development Goals. In 2015,
the UN General Assembly formally adopted the transformative 2030 Agenda for Sustainable
Development along with a set of 17 SDGs and 169 associated targets (UN 2017). Several SDGs
explicitly mention the role of companies in achieving sustainable development (UN 2017).
SDG12 Responsible Consumption and Production in target 12.6 encourages “especially large
and transnational companies, to adopt sustainable practice and to integrate sustainability
information in their reporting cycle” (UN 2017, p. 16). SDG16 Peace, Justice and Strong
Institutions in target 16.6 calls to “develop effective, account- able and transparent institutions
at all levels” (UN 2017, p. 21). Finally, SDG17 Partnerships for the Goals in targets 17.6 and
17.7 encourages multi-stakeholder and public-private partnerships for sustainable development
(UN 2017, p. 24).

CSR Standards

CSR standards, developed by international organizations, regional organizations and national

governments, nongovernmental organizations, and business associations, are applicable to both
for-profit and not-for-profit organizations. They regulate aspects of environmental
management, employee relations, health and safety, and other economic and consumer issues.
These include International Labour Organization (ILO) conventions to ensure minimum safe
working conditions, OECD guidelines for responsible business conduct toward sustainable
development, and the United Nations Global Compact (Baskin 2006; Kaufman et al. 2004;
OECD 2011). Sector-specific guidelines have been developed for international business such
as Apparel Industry Partnership to tackle the spread of sweatshops; Ethical Trading Initiative
to improve working conditions throughout supply chains and Forest Stewardship Council to
minimize irresponsible logging and improve sustainability in the forestry and paper industry
(Bartley 2003). Other voluntary environmental standards aimed at improving business
environmental performance include ISO 14000, developed by the International Organization
for Standardization (ISO) OHSAS 18000, provides; “Investors In People,” which addresses
human resources management; the EFQM (European Foundation for Quality Management)
excellence model which provides businesses with a framework to improve competitiveness and
business performance with integration of stake- holder and the EMAS (Eco-Management and
Audit Scheme) which promotes assessment, report, and improvement of environmental
performance of companies (Christmann and Taylor 2006).

Among the first attempts to progress, responsible labour practices were conducted by Social
Accountability International established in 1996 which triggered a development of SA 8000
standard in 1998 that provides assurance of social performance and aims to improve
management systems to address social and labour risks (SAI 2018). It aligns social practices
with the existing ISO 9000 and ISO 14000 certifications dedicated to quality improvement and
environmental management. Another important and widely used voluntary standard for
corporate social accountability is Global Reporting Initiative (GRI) introduced in 1998 and
developed in partnership between the Coalition for Environmentally Responsible Economies
(CERES), the Tellus Institute, and the United Nations Environment Programme (UNEP) from
1997 (GRI 2018). Ten years later, in 2008, UN Global Compact and GRI were considered de
facto global standards for economic, social, and governance reporting gathering nearly 30,000
stakeholders and more than 1,000 companies adopting GRI principles for reporting (Waddock
2009).

Various organizations monitor voluntary CSR activities of companies with ranking lists such
as 1% club, where companies are listed for contributing at least 1% of pre-tax profits to charities
through corporate philanthropy (Franklin 2008). In 2002, the CR index was presented by
Business in the Community and industry leaders to promote transparency and support
companies to systematically measure, manage, and integrate responsible business practices by
examining elements of corporate strategy, performance measurement, stake- holder
engagement, reporting, and dedication to issues of community, environment, market, and
workplace (BITC 2018).

In 2010, the ISO 26000 Social Responsibility document was introduced to provide “guidance
on how businesses and organizations can operate in a socially responsible way (ISO 2018)”.
ISO26000 provides definitions and terms of social responsibility and defines policies and
practices of corporate responsible behavior that can be integrated in organizational strategies.
The ISO was developed in consultation with representatives from government, industry, labor,
consumer and non-govern- mental organizations and interested parties (Waddock 2009);
however, unlike ISO 9000 and ISO 14000, the ISO 26000 is not a standard, but a guidance
which cannot be certified (ISO 2018).

In banking and finance, the Equator Principles determine how financial institutions should
address environmental and social matters throughout their project finance operations (Wright
and Rwabizambuga 2006). The investment sector has also embraced sustainability through
encouraging business to implement sustainability operations and reward socially responsible
businesses through inclusion in socially responsible investment (SRI) funds and monitoring
their social and financial performance through SRI indices. Three major SRI indices include
KLD Social Index (MSCI 2018), Dow Jones Sustainability Index (DJSI) (S&P 2018), and
FTSE4Good Index (FTSE Russell 2018).

CSR in Small- and Medium-Sized Enterprises

The majority of academic literature and practical guidelines on CSR focus on large companies
(Thompson and Smith 1991; Spence 1999). Disparities in approaches to CSR exist between
small- and medium-size enterprises (SMEs) and large corporations, where SMEs engage in
development of CSR activities, adoption of codes of conduct and international certification to
a lesser extent than large corporations (Graafland et al. 2003; Johannson 1997). The key
differences contributing to varied practice of CSR in SMEs and large corporations include
leadership styles by owner-managers, scattered supply chain, and cultural differences in SME
management supported by informal management culture, trust, intuition, and personal
judgment of owner-managers (Jenkins 2004). Although there is a lack of consensus about the
perception of CSR among SMEs, identification of relevant social responsibility issues and
integration of CSR in daily business routines (Baumann-Pauly et al. 2013; Lepoutre and Heene
2006), SMEs do engage in CSR activities. SMEs often view and practice CSR through
normative reasons rather than instrumental rea- sons to aid business development (Jenkins
2006; Hwang and Metcalfe 2016; Spence and Rutherfoord 2000).

CSR activities produce numerous benefits for SMEs such as improved image and reputation,
greater levels of trust and understanding, enhanced market positioning, higher employee
motivation, and enhanced attractiveness to potential recruits (Jenkins 2006). Among the
barriers for adoption of codes of conduct in SMEs, research identifies a lack of specific
codification of CSR for SMEs (Bondy et al. 2006; Jenkins 2004). Though SMEs need to adopt
higher social and environmental standards, they are advised to use different approaches to CSR
that considers particular needs of small business environments and varied capacity to contribute
to sustainable development (Fox 2005). By using a feminist perspective, Spence (2016)
proposes a four-part model of “ethic of care” as more appropriate framework for small
businesses, where small firms can develop CSR activities within four priority areas: (a) to self
and family, (b) to employees, (c) to local community, and (d) to business partners. A degree of
responsibility is laid upon large businesses as well to source and build capacity in SMEs and
support sustainable business linkages through supply chain relations, training, guidance, and
cooperation (Fox 2005; Spence 2007).

Critique and Future Agenda of CSR

CSR had been critiqued as alien to business and market rationale from the start. Many
academics and practitioners opposed the concept of extended business responsibility to the
society (Levitt 1958; Friedman 1970). Theodore Levitt, professor at Harvard Business School,
in 1958 criticized the desire for business to engage with social responsibilities and advised
business to focus solely on maximizing long-term profit by stating that “The function of
business is to produce sustained high-level profits…corporations are not narrowly profit-
oriented enough. Welfare and society are not the corporation’s business. Its business is making
money, not sweet music” (Levitt 1958, pp. 44–47). Milton Friedman (1970, pp. 133–134)
published a famous article in New York Times Magazine that warned against “the acceptance
by corporate official of a social responsibility other than to make as much money for their
stockholders as possible.” Friedman (1970) concluded that social responsibility is based on
property rights argument that sees man- agers as agents of shareholders with the sole purpose
of increasing shareholder value. He considered that acting in a dissimilar way would be a
violation of management’s moral, legal, and institutional obligations or in other words
“unethical” (Friedman 1970). Jones (1995) summarized that arguments against CSR are
supported by institutional function or property rights perspectives, while arguments in favor
are supported by ethical rationales based on business ethics and instrumental rationales that
socially responsible behavior will benefit business in the long term.

In addition to concerns for the lack of consensus on CSR definition, its broadness and
difficulties in establishing its content (Dahlsrud 2008; Jones 1999), CSR is often critiqued for
being a “white-wash” of corporate activities, aimed at curbing public concerns about
legitimacy, ethics, and negative consequences of business operations (Jones 1996; Blowfield
and Murray 2014). Critique highlights the drawbacks of voluntary standards such as the UN
Global Compact, GRI, and OECD Guidelines in terms of compliance and lack of sanctions and
penalties for noncompliant firms (Bhimani and Soonawalla 2005); others point to a high degree
of ambiguity and lack of transparency found in CSR reporting and standardization in
information presentation (Blowfield and Murray 2014).

Guidelines on corporate social performance have sparked criticism pointing out minimal effect
of codes of conduct and reporting guidelines on business practice since mechanisms to
supervise CSP do not generate reforms in public policy and legislation (Bhimani and
Soonawalla 2005; Kuhn and Ashcraft 2003). Though the triple bottom line concept attempts to
establish principles that give CSR an equal status to profitability concerns in a corporate
agenda, business strategy is predominantly influenced by commercial considerations, and
companies adopt CSR strategies only when they are under pressure to gain positive external
image (Kuhn and Deetz 2008). Further challenges are found in assessing compliance to social
standards, inefficiencies of social audits, and outdated measures of corporate performance
(Kuhn and Ashcraft 2003).

Implementation of CSR could be improved with further development of stakeholder-oriented

strategies, inclusion of specific definitions of elemental parts of CSR, improvement of
methodologies for corporate social performance, and strict assessment of CSR activities and
outcomes (Greening et al. 2000). CSR is continued to be seen as a way for businesses and
organizations to contribute to sustainable development, where the UN SDGs provide an
overarching guide and offer opportunities for businesses to align CSR strategies with the
updated sustainable development agenda. Many businesses and their associations are publicly
committing to the Agenda 2030, extending their sustainability and CSR strategies to reflect 17
SDGs (GRI et al. 2015; Yakovleva et al. 2017; Kolk et al. 2017). Regional organizations such
as the EU and national governments continue to play a facilitating role in promoting the
adoption of proactive CSR approaches among businesses by providing channels that increase
feedback, dialogue, and best practice, understanding and collaboration between stakeholders,
including the education of consumers on social responsibility, and empowering stakeholders
as the agents of change (EC 2015; HM Government 2009; Industry Canada 2014).

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