Learning from Stakeholder Pressure and Embeddedness: The Roles of Absorptive Capacity in the Corporate Social Responsibility of Dutch Agribusinesses

Abstract

In spite of much research on corporate social responsibility (CSR) responses to secondary stakeholders (i.e., social movements, activists, media, civil society and non-governmental organizations), the debate on how companies learn from pressure and collaboration with these societal groups is still open. Building upon stakeholder and knowledge management theories, this paper analyzes how secondary stakeholder pressure and embeddedness influence agribusiness companies’ absorptive capacity and their CSR strategies. Data are obtained from 152 Dutch agribusiness company managers. The results highlight that, first, absorptive capacity influences companies’ new product innovation, product positioning and organizational innovation to be more oriented towards CSR. Second, stakeholder embeddedness of agribusiness companies triggers absorptive capacity more than pressure from them. Third, stakeholder pressure and embeddedness also have direct (i.e., not mediated by companies’ absorptive capacity) yet weaker effects on CSR organizational innovation and product positioning. Findings corroborate the idea that firms develop innovative CSR strategies when they combine internal reflection processes and partnerships with secondary stakeholders.