Abstract
This paper, drawing on stakeholder and legitimacy theory, addresses the issue of stakeholders’ pressure effect on a firm’s CSR behavior. It focuses on the apparel sector as these companies, characterized by consumer proximity, are under the lens of stakeholders for their direct social performance as well as for their suppliers’ actions. We analyze the Nike case in order to study how stakeholders’ pressure shapes a firm’s engagement in CSR issues. Our study points out the dynamic nature of stakeholders and legitimacy, and it underlines the influence of two actors which are rarely considered as primary and most important stakeholders, namely media and social activist groups.
Highlights
Societal expectations about corporate activities nowadays focus on firms’ economic responsibilities within the boundaries established by law as well as within ethical guidelines
Our study points out the dynamic nature of stakeholders and legitimacy, and it underlines the influence of two actors which are rarely considered as primary and most important stakeholders, namely media and social activist groups
Environmental-sensitive industries are more subject to a legitimacy gap caused by their direct actions, but CSR concerns take into account issues, such as child labor and sweatshops, which can affect many industries [5]
Summary
Societal expectations about corporate activities nowadays focus on firms’ economic responsibilities within the boundaries established by law as well as within ethical guidelines. As Buchholtz and Carroll [1] observed “the social responsibility of business encompasses the economic, legal, ethical, and discretionary (philanthropic) expectations that society has of organizations at a given point in time”. If a firm does not comply with these expectations, society, and corporate stakeholders are likely to withdraw their support and the legitimacy that allows companies to survive [2]. Empirical studies demonstrate that a firm’s CSR activities affect its consumers purchasing behavior [3]. Stakeholders are very sensible to a firm’s direct actions and to its suppliers’ behavior [5]; firms engage with stakeholders’ pressures caused both from their direct and indirect actions
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