Csr And Business Ethics Analysis

6. Discussions

The idea of institution, institutional theory, CSR and business ethics are very important to analyze the main purpose of this paper, that is -

How institution is influenced by the underlying concept of CSR and business ethics?

Start with different context and dimensions.

CSR as comprised of three sets of activities: economic, social and environmental. The economic dimension of CSR is focused on addressing corruption; managing corporate governance issues; coping with external risk; and direct relationships with investors and customers. Environmental CSR is focused on any aspect of addressing environmental performance and environmental impacts of business activity. Social CSR is concerned with labor practices and human capital

Though the writing is based on the CSR in Western Europe but it gives an introductory idea about how CSR works with different institutional environment. According to Jackson - Corporate social responsibility (CSR) is often seen as a strategic response to pressure from stakeholders who may be adversely affected by company practices, or as a pro-active attempt by firms to pre-empt or at least mitigate these pressures and enhance the reputation and value of the corporation. Much research has aimed to establish the business case for CSR by examining its relationship with economic performance. Parallel to these efforts, other literature has focused on the moral and ethical justifications for CSR independent of its potential economic utility.(

- is analyzed by different scholars by focusing on CSR and the financial performance as well as the relationship between a firm’s internal characteristics and its external social performance ( Bhambri and Sonnenfeld, 1988). Hence, Jackson focused on instrumental motives that may drive the adoption of CSR practices, in an effort to reduce reputational risk and improve financial performance. Moreover, on the basis of both neo-institutional theory and comparative institutional analysis, his study examines how institutional factors influence the CSR practices across different sectors and countries. For example - how firms operate in a country which has strong stockholder impact? Their analysis using correlation matrix indicates that, firms adopt more CSR with in a country with strong stockholder impact for example – Germany. Their study also indicate firms with headquarter in CME countries adopt more CSR that LME countries. This is because institutional diversity exists at the national level in ways that lead to comparative institutional advantages for those corporations that operate within different countries. (Hall and Soskice, 2001). Following by that, firms with headquarter in LME countries adopt more extensive and explicitly measurable CSR other than firms in CRM countries. This argument was analyzed by Matten and Moon, who offer another perspective on how