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Corporate Social Responsibility and Business’ Contribution to Governance in Areas of Regulatory Void

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Seminar Room B, not SCR as usual

In the past 20 years, transition countries in the South and East – such as the BRIC states (Brazil, Russia, India, China) and other G20 countries – have experienced impressive economic growth. While these countries are comparatively strong in the international system and vis-à-vis their societies, their intense economic growth is often not balanced by sufficiently strict social, health and environmental regulations or by comprehensive service and common good provision. It is in this context that political scientists have become intrigued by the phenomenon of corporate social responsibility (csr) as the attempt to close such gaps in governance. Why and under which conditions do firms make an attempt to engage in csr and contribute to governance in areas where the state is limited or weak? And under which conditions may such attempts be successful, and when do they fail? The talk makes the case for the importance of paying attention to the internal dynamics of business in order to understand why and under which conditions firms engage in csr. The argument is that csr assists decision-makers in firms to resolve managerial dilemmas. A managerial dilemma is a situation whereby the execution of management’s decisions transforms the intra-organizational mode of social coordination from a hierarchy to one in which managers become dependent on, and vulnerable to the behavior of subordinates. I argue that it is in these situations that corporate decision-makers introduce csr in their attempt to avoid the foreseeable loss of control and organizational efficiency. The talk illustrates this argument with empirical examples and in this context also discusses factors that make attempts by business to contribute to governance a success.

This talk is part of the CISA Talks - Cambridge International Studies Association series.

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