“NO CRIME, NO PUNISHMENT”: BRASKEM’S CORPORATE SOCIAL IRRESPONSIBILITY IN MACEIÓ

Corporate social irresponsibility may, indeed, be one of the “grand challenges” of international business and management research. Corporate social irresponsibility (CSI) is broadly assumed to lead to performance decline and reputational damage for those firms involved in acts of wrongdoing. The overview of extant research presented in this chapter illustrates how and why these assumptions are not always supported, therefore explaining, at least in part, the many examples of irresponsible firm behavior observed in business practice. The chapter points to the discrepancies between CSI theory and CSI practice, followed by a discussion concerning the opportunities and challenges associated with acts of irresponsible firm behavior, particularly during times of crises and disruptions. The discussion captures key managerial and policy implications around curtailing corporate social irresponsibility.KeywordsCorporate social irresponsibility (CSI)Performance outcomesOrganizational reputationStakeholder expectationsESG (Environmental, Social, and Corporate Governance)Crises and disruptions

PurposeToday's business world has been tarnished with numerous corporate irresponsible behaviors. It is thus of great importance for firms to carry out crisis management on the condition of corporate social irresponsibility (CSI). Taking a contingent social media crisis management perspective, the authors aim to investigate the relation between CSI and firm value while also examining the moderating effects of being known in social media and generalized favorability in social media on this relation.Design/methodology/approachThe empirical analysis conducted in the authors' research is based on a sample of 203 CSI events that occurred within publicly listed firms in China between 2011 and 2015. During the process of the authors' data collection, the authors initially verified the occurrence of CSI events in publicly listed firms by reviewing reports from reputable sources such as the 21st Century Business Herald and China Securities Journal. Subsequently, the authors collected the information pertaining to media coverage of these CSI events from the China Core Newspapers Full-text Database (CCND). Additionally, the authors obtained the remaining data from reliable sources such as Guba, the China Stock Market and Accounting Research Database (CSMAR) and the Chinese News Analytics Database (CNAD). To test the authors' hypotheses, the event study and multiple-regression analysis methods are adopted.FindingsThe authors find CSI generates a negative impact on firm value. Moreover, while being known in social media strengthens the negative relation between CSI and firm value, generalized favorability in social media weakens such relation.Research limitations/implicationsThere are two streams of limitations that present promising avenues for future studies. Theoretically, the authors explore the mechanisms of CSI affecting firm value from a contingent social media crisis management perspective. Consequently, the authors' study does not encompass other potential mechanisms that may exist in the CSI–firm value linkage. In terms of empirical analysis, three issues arise that provide opportunities for further investigation. First, the authors have not accounted for all potential factors that could influence the link between CSI and firm value. Second, the authors' data are subject to limitation since it comes from manual collection. At last, because the authors confirm the sample based on the actual CSI events of publicly listed firms in China, the authors' sample size is small.Originality/valueThe authors' findings contribute to a more comprehensive understanding of the relation between CSI and firm value, as well as effective strategies for responding to CSI through the utilization of social media. Consequently, the authors' results have the potential to stimulate further research on the implications of CSI and the management of corporate crises through social media platforms.

The joint effect of corporate social irresponsibility and social responsibility on consumer outcomes

The article presents a socio-philosophical study of corporate social irresponsibility as a distinct social phenomenon requiring its own categorical definition. The relevance of the topic is driven by the growing number of international studies in this area alongside the lack of adequate conceptualization within the Ukrainian academic discourse. The aim of the article is to clarify the meaning of “corporate social irresponsibility” through the analysis of its attributive features, the social context of its manifestation, and epistemological distortions. It is established that in cases of corporate irresponsibility, society tends to attribute responsibility not only to individual actors but also to the organization as a moral agent, through the mechanism of intent attribution or deliberate neglect of duties. The study reveals that irresponsible corporate behavior is not merely the result of individual violations but rather a form of institutionalized practice that is reproduced through normative relativity, informational asymmetry, and reputational risk. A typology of research approaches to corporate social irresponsibility is proposed, including conceptual, organizational, psychological, intercultural, mnemonic, sectoral, and regulatory-legal dimensions. It is found that in the context of international discourse, corporate social irresponsibility is increasingly conceptualized as a multidimensional phenomenon that combines material, symbolic, and structural forms of harmful practices. A working definition of corporate social irresponsibility is proposed based on a logical and epistemological analysis of its attributive characteristics. The influence of cultural environment, legal vacuum, and managerial practices on the formation of relevant behavioral models is assessed. The conclusion highlights the need for further theoretical articulation of the concept as a prerequisite for its practical operationalization. It has been proven that corporate social irresponsibility is a systemic, institutionalized form of action of a commercial organization, which manifests itself in a conscious or indifferent violation of ethical, legal or social norms, which harms a wide range of stakeholders or society as a whole, is accompanied by a moral attribution of intent or responsibility on the part of the social environment, and occurs in conditions of information asymmetry, reputational risk and normative relativity.

PurposeThe aim of this article is to highlight the major part played by executives in the escalation of corporate social irresponsibility (CSI). Based on the upper echelons theory, the authors developed a model which shows the essential role of CEOs in explaining CSI. The authors proposed that the key personality traits of CEOs—narcissism—, as well as their power, could explain the degree of CSI.Design/methodology/approachDue to the significant methodological challenges when investigating CSI, the authors explored a novel method for measuring CSI in order to assess the degree of irresponsible behaviors. The authors build a CSI scale based on the perceptions of key informants, i.e. experts with diverse professional backgrounds. The authors apply CSI scale in a sample of 84 Spanish companies that were involved in CSI.FindingsThe results of the authors’ empirical study show the positive and significant influence of CEO narcissism and CEO power on the degree of CSI.Research limitations/implicationsOn the one hand, corporate irresponsibility scandals have relevant social consequences and practical implications. On the other hand, narcissism is a natural feature of managers in top positions that is increasing in societies.Practical implicationsThe authors’ findings may help CEOs, TMTs and corporate boards to acknowledge potential sources of CSI decreasing its likelihood through counterbalancing CEO's power and considering the dark side of narcissism.Social implicationsOn the one hand, corporate scandals have relevant social and practical implications. On the other hand, narcissism is a natural feature of managers in top positions that is increasing in societies.Originality/valueIn this paper, the authors highlight the role of CEOs characteristics and their firms as the key actors for explaining and understanding the degree of CSI.

PurposeIn weaker institutions, lack of corporate social responsibility (CSR) constituencies causes organizations to naturally incline toward corporate socially irresponsible actions. Grounded in the institutional theory, this paper aims to explore the nature of corporate social irresponsibility (CSIR) in the weaker institution and its effect on legitimacy and reputation. The presence of corporate ability moderates the impact of CSIR on legitimacy and reputation.Design/methodology/approachA list of manager’s contact information was generated from an online database. In total, 1,500 employees in 560 Pakistani organizations received the self-reported survey. In total, 203 managers working in 110 Pakistani organizations responded with the completed questionnaire that provided empirical support to the hypotheses.FindingsInstitutional drivers were positively significant to CSIR and negatively associated with the manager’s CSR attitudes. CSIR was negatively significant to legitimacy and reputation. Group differences between high and low corporate ability indicated that corporate ability played a vital role between CSIR and reputation.Practical implicationsThese results have important implications for leaders, business-to-business and human resource (HR) managers in weaker institutions highlighting that organization’s supply chain partners consider adopting CSR practices. This can help the organization avoid undesirable and detrimental impact on its legitimacy and reputation, which are linked to irresponsible behaviors. HR managers should build CSR cognition in employees to bring effective change in the organization.Originality/valueLack of investigation into corporate ability and CSIR has raised questions about the organization’s efforts in the weaker institution that are sensitive to institutionalized corruption. This research adds to the literature by exploring how the organizations develop legitimacy and reputation while still acting irresponsibly in a weaker institution, presenting a paradox.

Service providers and retailers reselling branded have the discretion to set and adapt prices according to customers’ willingness to pay (WTP). Research often notes markup effects, such that WTP increases in response to corporate social responsibility (CSR) and markdown effects, lowering their WTP for corporate social irresponsibility (CSI). Theory suggests attitude changes to (negative) CSI are stronger than to (positive) CSR, but the extent and whether this difference holds for WTP and across various product types are unknown. Using experimental data, an incentive-compatible measure, and an actual purchase, this article reports on three studies that show that consumers mark up WTP for CSR and mark down WTP for CSI. The differential effects arise across brands; compared with WTP for a competitor brand, the acceptable price of a focal CSR/CSI brand is marked down more than it is marked up. Comparing the WTP for a focal brand relative to the average CSR performance of that brand does not produce any within-brand differential effects The evidence also indicates a product type effect: Consumer WTP adaptation for CSR or CSI is stronger for utilitarian than for hedonic products. These findings have implications for service providers, retailers and manufacturing firms, as well as for further research.

A growing body of literature documents the important role played by moral outrage or moral anger in stakeholders’ reactions to cases of corporate social irresponsibility. Existing research focuses more on the consequences of moral outrage than a systematic analysis of how appraisals of irresponsible corporate behavior can lead to this emotional experience. In this paper, we develop and test, in two field studies, an extended model of moral outrage that identifies the cognitions that lead to, and are associated with, this emotional experience. This research contributes to the existing literature on reactions to corporate social irresponsibility by explaining how observers’ evaluation of irresponsible corporate behavior leads to reactions of moral anger. The paper also helps clarify the difference between moral outrage and other types of anger and offers useful insights for managers who have to confront public outrage following cases of irresponsible corporate behavior. Finally, the analysis of the causes of stakeholders’ anger at irresponsible corporations opens important avenues for future research that are presented in the paper.

Corporations perform actions that can inflict harm with different levels of intensity, from death to material loss, to both companies’ internal and external stakeholders. Research has analysed corporate harm using the notions of corporate social irresponsibility (CSIR) and corporate crime. Critical management studies (CMS) have been subjecting management and organizational practices and knowledge to critical analysis, and corporate harm has been one of the main concerns of CMS. However, CMS has rarely been deployed to analyse CSIR and corporate crime. Thus, the aim of this paper is to critically analyse the perspectives of CSIR and corporate crimes on corporate harm via CMS in general and postcolonial studies in particular. The paper contributes by arguing that research on CSIR and corporate crime could be perceived as producing research that does not challenge the essence of contemporary corporation profit-seeking activities that ultimately produces corporate harm. We argue that CSIR and corporate crime are ideologies that assist in disguising the contradiction between producing shareholder value and the social good that is at the heart of the modern corporation system and the current economic system. Furthermore, the postcolonial view of CSIR and corporate crime highlights how they are based on a Western-centric view of corporate harm that ignores the realities and perspectives of the Global South, especially in situations where corporate harm leads to death in the Global South.

We investigate the classic management debate of agency versus institutional pressures through the application of the varieties of capitalism literature. In particular, we examine corporate social responsibility (CSR), corporate social irresponsibility (CSiR) and their relationships with firm performance in two types of capitalist systems: coordinated market economies (CMEs) and liberal market economies (LMEs). We note that while the CSR literature has tended to develop a balanced view on the influence of agency and institutional pressures, the CSiR literature has tended to emphasize the influence of agency. The latter appears to be a result of the fundamental attribution bias, where irresponsible corporate behaviours are attributed to individual managers or organizations, rather than the institutional environment. Our results, which include five years of data across 16 countries, show significantly greater CSR and significantly lower CSiR in CMEs compared with LMEs. Further, we find a positive relationship between CSR and firm performance in CMEs but not LMEs, and a negative relationship between CSiR and firm performance in LMEs but not CMEs. Overall, our results demonstrate the influence of the institutional environment, suggesting that corporate behaviours mirror the external environment.

An important objective of business research is to understand how organizational practices can influence consumer attitude and behaviors in order to help achieve organizational goals via consumer purchase intention. It was proposed and found in this study that consumers’ perceptions of certain Corporate Social Irresponsible (CSI) practices serves as antecedents of consumer purchase intention (PI) via corporate reputation (CR) and consumer attitude (CA). On the one hand, this finding may help understand the “black box” between CSI practices and PI. On the other hand, while CR refers to customers’ evaluations of the reputation of the organization and CSI represent a significant channel the organization uses to channel its irresponsible behavior to the community, CR and CA literatures have not comprehensively examined the effect of CSI practices on consumers CA and CR beliefs. The findings in the hierarchical regression from a sample of 455 consumers of products in a large corporate organization in Kenya as a study documenting a negative association between CSI practices and CR and CA with PI suggests that consumers draw inferences from the CSI-related treatment they receive in assessing the supportiveness of the organization. By implementing CSI practices that demonstrate the organization does not care about the community and values their contribution, organizations are likely to be perceived as engaging in a high level of irresponsible behaviour. The results of this study add to our knowledge about the antecedents of CR and CA. Moreover, this study bridges the gap in the literature, by combining CSI, CR, CA and PI.

Irresponsible behavior of corporations is rampant, causing tremendous harm on a regional, national, and global scale. Sometimes stakeholders challenge such behavior, sometimes it remains unchallenged. A substantial body of research has emerged on the conditions that affect if and when stakeholders—such as investors, consumers, or local communities—mobilize against corporate social irresponsibility, yet this literature is fragmented, which hampers our understanding of the phenomenon. This paper systematically reviews 151 articles on stakeholder mobilization against corporate social irresponsibility to condense our understanding of the drivers and hindrances for stakeholder mobilization to occur. We develop a model that depicts when stakeholders are likely to mobilize against corporate social irresponsibility. Based on this model, we derive suggestions for future research, depicting what we still need to learn about the conditions that lead to stakeholders’ mobilization against corporate social irresponsibility.

We study how corporate governance moderates the relationship between corporate social responsibility (CSR), corporate social irresponsibility (CSI), and firm risk. We find that CSR reduces risk for firms with strong governance. In contrast, CSI increases firm risk more significantly for firms with stronger governance, suggesting that backlash is more severe when well‐governed firms engage in irresponsible behavior. Overall, our evidence indicates that the negative impact of CSI for well‐governed firms outweighs the risk‐reducing benefits of CSR. These findings provide strong support for information intensity arguments.

Purpose - This chapter develops a novel conceptualization of corporate social irresponsibility (CSI) and identifies possible avenues for further research in the international business (IB) and related fields. Design/methodology/approach - A conceptual chapter examining the existing definitions of CSI and proposing a classification of irresponsible behaviours using an international law approach. Findings - The concept of CSI has been weakly conceptualized and measured so far. We improve this by distinguishing between unethical conduct bearing no direct impact on human rights and those behaviours that do entail a human rights impact. Next, we classify human rights abuses in two categories based on whether they entail the violation of a derogable or a non-derogable human right. Finally, we make a distinction between direct and indirect irresponsible actions. These distinctions are also illustrated empirically. Originality/value - This chapter bridges the gap between IB, management and international law research on human rights or else defined irresponsible behaviours. Our novel conceptualization of CSI can help to better address unanswered questions about factors driving CSI in IB firms. Copyright © 2014 by Emerald Group Publishing Limited.

PurposeTo date, many firms tend to use corporate social responsibility (CSR) communication and marketing as a means to offset their irresponsible behaviors and unscrupulous business practices. Often time, they can easily get away with this in the context where the institutional settings are weak, and corporate social irresponsibility (CSIR) and corruption are widespread. The purpose of this study is to explore stakeholders’ attribution concerning CSR claims of four beverage manufacturing companies operating in America’s poorest country (Haiti) where CSIR and corruption remain widespread. This study also explores whether there are differences in demographic characteristics (e.g. gender, corporate affiliation and education) regarding stakeholders’ attribution of CSR claims of these companies.Design/methodology/approachGiven the exploratory nature of this study, an inductive research approach (qualitative plus quantitative) and supported by an interpretive approach were used.FindingsThe overall results of this study show that internal (employees) and external stakeholders alike consider the CSR claims of these companies as “cosmetic,” with no significant difference in their affiliation. The results also show no significant differences in the age groups but significant differences in gender and level of education regarding stakeholders’ attribution of firms’ CSR claims.Originality/valueBy addressing firms’ CSR claims from the perspectives of internal and external stakeholders through means of a mixed methods approach, this study adds an important contribution to the relevant literature.