Mandating Socially Responsible Behavior
28 Pages Posted: 4 May 2013
Date Written: May 3, 2013
Abstract
Management theory and practice are facing unprecedented challenges. The lack of environmental sustainability, the increasing inequity and the continuous decline in societal trust pose a threat to ‘business as usual’ (Jackson & Nelson, 2004, p. 214). It is argued that legitimacy has been lost by irresponsible corporate behavior. A logical step to remedy the current problems could be to regulate and mandate responsible corporate behavior. This endeavor though seems easier said than done, as a legal approach presupposes that there are clear answers to questions of responsibility that can easily be regulated. In this chapter we will engage with the question of mandating socially responsible behavior by providing a general framing of the discussion on CSR, and outlining the benefits of socially responsible behavior for a set of companies that engage in B2C commerce. We then outline the benefits of mandated social responsibility standards, and the potential downsides. Finally we suggest alternatives and complements to mandated socially responsible behavior, via strategy and governance structure changes. Before we do so, we wish to outline the big picture challenges of the current economic structure epitomized by shareholder capitalism, which motivate the quest for more socially responsible corporate behavior. At the same time, these challenges outline the necessity of mandates for social responsibility. We then outline different approaches to CSR, as developed in practice and theory, to guide further discussion.
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