Daniel P. Kinderman

Corporate Social Responsibility in the EU, 1993–2013: Institutional Ambiguity, Economic Crises, Business Legitimacy and Bureaucratic Politics

What drives European Union (EU) policy change in a sensitive and contentious area? To answer this question, this article tells the story of corporate social responsibility (CSR) in the EU from its beginnings until the present. The EU’s role in EU CSR has changed from social-liberal standardsetter to neo-liberal cheerleader and back. This article attempts to explain these shifts. It argues that Europe’s institutional diversity hampers standard-setting while economic crises and declining levels of business legitimacy facilitate it. Contention has been fuelled by CSR’s inherent ambiguity: is CSR a means to regulate the economy, or a domain of voluntary activity that must remain free of state regulation? Fearful of regulation, business groups – German employers in particular – have forcefully advocated the latter view. In addition to converting EU CSR from social-liberal to neo-liberal, business has neutralized two of the Commission’s standard-setting advocates. The financial crisis, the power of arguments and discourse, and the impact of global policy developments in the field of CSR have re-empowered standard-setters. The article concludes with a critical analysis of the EU’s renewed CSR strategy and non-financial reporting agenda.

Why Do Some Countries Get CSR Sooner, and in Greater Quantity, than Others? The Political Economy of Corporate Responsibility and the Rise of Market Liberalism Across the OECD: 1977-2007

How can we explain the historical and trans-national variation of Corporate Responsibility – business’s voluntary engagement for social and environmental ends above legally mandated minimum standards – and how are we to understand this amorphous and essentially contested phenomenon? In this paper, I propose a political-economic explanation for the variation of Corporate Responsibility [Corporate Social Responsibility (CSR) and Corporate Citizenship]. I posit that Corporate Responsibility’s temporal and cross-national variation is linked to its function of legitimating economic liberalization and market liberalism. Both employers and state officials have an interest in compensating for the hardships of liberalization and the weakening of institutionalized social solidarity. One way in which they seek to legitimate the market vis-a-vis their ‘stakeholders’ and the electorate, and justify themselves vis-a-vis their own conscience, is through Corporate Responsibility. CR inoculates firms against burdensome regulation and justifies a light regulatory touch; it facilitates business-friendly institutional reforms; it helps to satisfy employers’ needs and compensate for market failures and deficiencies in public provision. But CR cannot be understood in purely rational-instrumental let alone cynical terms. One of its most essential functions is to constitute businesspeople as responsible moral agents. Those in the engine rooms of contemporary capitalism – whether owners, managers, or employees – want to perceive themselves as serving the common good. This is true irrespective of capitalist ‘varieties.’ In the place of Milton Friedman’s assertion that the business of business is business, employers chant: ‘Free us up so we can do some Corporate Responsibility!’ Using national Corporate Responsibility associations and their membership levels as a proxy for the institutionalization of CR, this paper develops and tests a political-economic explanation for the temporal and trans-national variation of CR. Using Corporate Responsibility associations, a novel proxy for the state of CR in a given country at a given time, I hypothesize that Liberal Market Economies tend to ‘get’ CR earlier, and get more of it, than Social / Coordinated Market economies. Furthermore, Corporate Responsibility co-evolves with the decline of institutionalized social solidarity, ‘embedded liberalism’ and ‘organized capitalism.’ Empirical evidence from more than twenty OECD countries and from the CR ‘leader’ United Kingdom and ‘laggard’ Germany support these hypotheses and illustrate the co-evolution of CR and market liberalism during the past thirty years. In sum, this paper suggests that CR functions as a material and symbolic substitute for institutionalized forms of social solidarity.

The Political Economy of Corporate Responsibility in Germany, 1995-2008

During the past decade, Corporate Responsibility – the voluntary engagement of business for social and environmental ends above legally mandated minimum standards – has risen to prominence, if not pre-eminence in global economic governance. However, Corporate Responsibility is not uniformly distributed: the timing, extent and quality of CR varies significantly across countries. Germany is said to be a ‘laggard’ in Corporate Responsibility. This paper both describes and tries to explain this state of affairs, by focusing on business-led Corporate Responsibility associations, coalitions and intermediaries. Examining these, I find that German firms’ stance towards CR has been characterized by ambivalence. For example, German firms joined the EBNSC (since 2000: CSR Europe) in large numbers in the mid-1990s, only to cancel their memberships a few years later. I argue that this ambivalence can be explained with reference to Germany’s institutional framework, corporate governance and regulatory standards, which until recently left less ‘space’ for German companies to engage in CR initiatives compared with their counterparts in the U.K. and U.S.A. The increasing liberalization of the German economy during the past fifteen years has been accompanied by a growing dynamism of CR in Germany, and I present causal mechanisms which link CR and liberalization. The German case suggests that Corporate Responsibility may be emerging as a substitute, rather than a complement, to institutionalized forms of solidarity.

Time for a Reality Check: Is Business Willing to Support a Smart Mix of Complementary Regulation in Private Governance?

Abstract In recent years, scholars and policymakers have become interested in the idea of a smart mix of voluntary and regulatory measures in private governance. If public and private actors are to share the work load of governing the commons, this presupposes that both sides can agree on this compromise formula — but can they? So far, we have limited knowledge of firms and business associations’ regulatory preferences in this realm. As a ground-clearing exercise my article aims to help fill this gap and expose some of the underappreciated fault and conflict lines within private governance. Its thrust is that existing literature is excessively optimistic about businesss willingness to support regulation. The article surveys the EUs non-financial disclosure Directive and half a dozen other attempts to regulate CSR or non-financial disclosure across the world, and finds that public authorities’ more ambitious attempts at regulation met with vigorous business opposition. Even after the financial crisis, most business associations and firms reject a smart mix in favor of voluntarism and soft law without hard sanctions.

Explaining the Rise of National Corporate Social Responsibility: The Role of Global Frameworks, World Culture, and Corporate Interests

My chapter addresses the question: to what extent did global CSR frameworks shape national-level business-led CSR organizations? I find that national CSR associations were already successfully consolidated in several countries in the 1970s and 1980s and were relatively autonomous from global CSR frameworks that struggled to be institutionalized during the same time period.From a political economy perspective, it is not surprising that corporations would engage more with domestic business-led CSR organizations than alternative global frameworks over which they have less control. However, I also find that the establishment of national CSR associations is strongly correlated with country memberships in international non-governmental organizations. This suggests an important global-domestic dynamic whereby global nongovernmental linkages may have first encouraged the growth of national CSR associations before pushing CSR concerns up to the level of global CSR frameworks. This paper this chapter highlights the importance of both world society and political economy perspectives for understanding CSR in a globalizing world.

Corporate Social Responsibility and the Welfare State: The Historical and Contemporary Role of CSR in the Mixed Economy of Welfare

as relational in nature, these programs present an ‘‘interesting case of a mechanism for fostering autonomy through relations of embodied recognition’’ (p. 138). Specifically, because these programs typically recognize the embodied and relational nature of autonomy, and have substantial user-involvement and/or are user-run, these programs can become sources of social support and can serve as a site to enact autonomy. In the conclusion to the book, the author provides an account of the methodology that she utilized in this work, a technique she refers to as an ‘‘empirically situated approach.’’ She also utilizes this chapter to highlight the benefits of conducting contextual analyses and the use of a ‘‘feminist theoretical foundation’’ (p. 162). While we agree this sort of approach could be very advantageous, the author draws mainly on findings from published work. Although she engages in some analysis of documents pertaining to the programs and laws, it was unclear when the author was pulling from a primary source or a secondary source. Primary data analysis may have proven to be richer than employing secondary sources. This limitation aside, the book presents a number of strengths. It is well organized, with each chapter including strong introductions and conclusions that outlined the key arguments. Sociologists who are unfamiliar with political science will be exposed to political science theories of autonomy and social citizenship, including political feminist theory. Finally, BenIshai’s attention to re-conceptualizing different concepts and the coverage of a wide spectrum of social service programs are important assets of this work. Corporate Social Responsibility and the Welfare State: The Historical and Contemporary Role of CSR in the Mixed Economy of Welfare, by Jeanette Brejning. Burlington, VT: Ashgate, 2012. 193pp.

Pressure from without, Subversion from within: The Two-Pronged German Employer Offensive

99.95 cloth. ISBN: 978140 9424512.