Summary Articles Week 1
BSS ARTIKEL WEEK 1.1
This early qualitative empirical analysis is one of the most fundamental papers in the field of
organizations and the environment. Focus on the motives of why firms go green at
different levels of analysis.
We conducted a qualitative study of the motivations and contextual factors that induce
corporate ecological responsiveness.
Three motivations for going green:
1. Competitiveness,
2. Legitimation, and
3. Ecological responsibility.
These motivations for going green were influenced by three contextual conditions:
1. Field cohesion,
2. Issue salience, and
3. Individual concern.
In this article, we also identify the conditions that likely lead to high corporate ecological
responsiveness.
During the last decade, researchers concerned with organizations and the natural
environment have investigated why firms respond to ecological issues.
They have examined why some firms em- brace ecologically responsive initiatives,
while oth- ers in seemingly similar circumstances do not even comply with existing
legislation.
Understanding the motives for corporate ecological responsiveness is critical for two
reasons.
1. First, this understanding could assist organizational theorists to predict eco- logically
based behaviors. For example, if corporations adopt ecologically responsive
practices merely to meet legislative requirements, then firms will engage in only
those activities that are man- dated.
2. Second, this understanding could expose the mechanisms that foster ecologically
sustainable organizations, allowing researchers, managers, and policy makers to
determine the relative efficacy of command and control mechanisms, market
measures, and voluntary measure
,The purpose of this study was to examine why companies "go green" and, in so doing, to
refine a model that explains corporate ecological responsiveness by identifying motivations
for adopting ecological initiatives and the underlying factors that lead to each motivation
Corporate ecological responsiveness = a set of corporate initiatives aimed at mitigating a
firm's impact on the natural environment.
- These initiatives can include changes to the firm's products, processes, and policies,
such as reducing energy consumption and waste genera- tion, using ecologically
sustainable resources, and implementing an environmental management system.
As noted, the data analysis suggested three basic motivations for ecological
responsiveness:
1. Competitiveness,
2. Legitimation, and
3. Ecological responsibility
We define the term "competitiveness" here as the potential for ecological responsiveness to
improve long-term profitability.
Ecological responses that improved competitiveness included energy and waste
management, source reductions resulting in a higher output for the same inputs
(process intensification), ecolabeling and green marketing, and the development of
"eco products".
Firms motivated by competitiveness expected that their ecological responsiveness
led to sustained advantage and hence improved their long-term profitability.
Competitive advantage can be gained through environmental responsibility.
Competitiveness, in contrast to other motivations, resulted in greater attention paid to the
cost- benefit analyses of ecological response
Firms motivated by competitiveness actively innovated ecologically benign processes and
products to enhance their market positions.
A motive of legitimation refers to the desire of a firm to improve the appropriateness of its
actions within an established set of regulations, norms, values, or beliefs.
Examples of legitimation as shown by the data included:
Complying with legislation,
Establishing an environmental committee or environmental manager position to
oversee a firm's ecological impacts and advise senior management,
Developing networks or committees with local community representation,
Conducting environmental audits,
, Establishing an emergency response system,
Aligning the firm with environmental advocates.
Threats to a firm's legitimacy were believed to undermine a firm's license to operate or its
long-term survival.
- The data suggested that legitimation was directed toward complying with institutional
norms and regulation.
- Firms motivated by legitimation were focused on the stakeholders most influential
in prescribing or articulating legitimacy concerns.
We viewed ecological responsibility as a motivation that stems from the concern that a firm
has for its social obligations and values.
Within the data, initiatives motivated by ecological responsibility included:
The redevelopment of previously used land to green areas,
The provision of a less profitable green product line,
Donations to environmental interest groups and other local community groups,
The use of recycled paper,
The replacement of retail items or office products with ones more ecologically benign,
The recycling of office wastes.
A salient feature of this motivation was a concern for the social good. The ethical aspects of
ecological responsibility, rather than the pragmatic, were emphasized, which clearly
differentiated this motivation from the other two
Firms motivated by ecological responsibility often pointed to a single individual who had
championed their ecological responses.
- The decision process was often based on the values of powerful individuals or on the
organization's values rather than a widely applied decision rule
As a result of individual leadership and a desire to uncover the most ecologically benign
solutions, firms motivated by ecological responsibility often chose independent and
innovative courses of action, rather than mimicking other firms whose motive was
legitimation.
- In essence, these firms were looking to do the "right thing".
, In addition to identifying the motivations for corporate ecological responsiveness, the
study also revealed the contexts of these motivations.
Three contextual dimensions influenced the dominant motivations of firms:
Issue salience,
Field cohesion,
Individual concern
We define issue salience as the extent to which a specific ecological issue has meaning for
organizational constituents.
Certainty, transparency, and emotivity determine an issue's salience.
1. Certainty is the degree to which the impact of the issue on the natural environment
can be measured.
2. Transparent issues are those that are easily attributable to a polluting firm.
3. Emotive issues are those that elicit an emotional response from organizational
constituents.
Respondents indicated that salient issues were also viewed as having a potentially
significant impact on firm profitability because government agencies were more likely to
impose fines or penalties on activities, and customers were more likely to be aware of
negative ecological effects and less supportive of firm activities.
,We define field cohesion as the intensity and density of formal and informal network ties
be- tween constituents in an organizational field.
An organizational field consists of "those organizations that, in the aggregate,
constitute a recognized area of institutional life: key suppliers, resources and product
customers, regulatory agencies, and other organizations that produce similar
services or products".
Fields are built around a network of interorganizational relationships. The intensity of
the relation- ships is facilitated by proximity, both social and geographic, and through
the interconnectedness of constituents in the field.
Negative images of the industry's ecological im- pacts and the activities of industry
associations helped develop field cohesion.
- Respondents from firms that were connected closely to their competitors through
these types of field cohesion arrangement.
- The data revealed that field cohesion influenced firms' motivations. The
connectedness of employees, owners, and local residents increased the frequency
and intensity of interactions, placing the firms operating within that field under greater
scrutiny and resulting in concerns about their legitimacy.
Firms in fields with high cohesion were less likely to be motivated by competitiveness. Given
the heavy overt and covert pressures to conform within cohesive fields, it became difficult for
firms to be unique.
- Competitive moves were often replicated within the field. Innovations diffused among
firms rapidly, eliminating potential benefits associated with them. Firms exceeding
industry expectations were persecuted by industry peers.
Firms were less likely to be motivated by pursuing higher levels of ecological responsibility in
a cohesive field.
- Field cohesion implied that firms shared the same understanding of acceptable
organizational practices.
Individual concern for the natural environment is the degree to which organizational
members value the environment and the degree of discretion they possess to act on their
environmental values.
Firms are comprised of individuals who have "bounded rationality," cognitive biases,
and personal values that direct their actions.
Personal values can influence a firm's ecological responses in three important ways.
1. First, organizations are bombarded with numerous signals, only some of which
are relevant to them. Values help decision makers to discriminate between those that
are im- portant and those that are not.
, 2. Second, environmental values will induce some organizational members to champion
ecological responses.
3. Third, a firm's top management team and other powerful organizational members are
more receptive to changes in the organizational agenda, products, and processes if
these fit with their own personal values.
Individual concern for the environment on the parts of organizational members or owners
led to the motivation of ecological responsibility.
Individual concern also led to a legitimation motivation if the concerns of the indi- vidual
were congruent with those of constituents within society
,BSS ARTIKEL WEEK 1.2
Friedman’s classic critique of Corporate Social Responsibility (CSR) has been extremely
influential. Try to list the main arguments provided in the article. Think about how these
arguments relate to broader ideologies about the role of business.
The businessmen believe that they are defending free enterprise when they declaim that
business is not concerned "merely" with profit but also with promoting desirable "social"
ends; that business has a "social conscience" and takes seriously its responsibilities for
providing employment, eliminating discrimination, avoiding pollution and whatever else may
be the catchwords of the contemporary crop of reformers.
- Businessmen who talk this way are unwitting puppets of the intellectual forces that
have been undermining the basis of a free society these past decades.
The discussions of the "social responsibilities of business" are notable for their analytical
looseness and lack of rigor.
What does it mean to say that "business" has responsibilities? Only people have
responsibilities.
A corporation is an artificial person and in this sense may have artificial
responsibilities, but "business" as a whole cannot be said to have responsibilities,
even in this vague sense.
The first step toward clarity in examining the doctrine of the social responsibility of
business is to ask precisely what it implies for whom.
Presumably, the individuals who are to be responsible are businessmen, which means
individual proprietors or corporate executives. Most of the discussion of social responsibility
is directed at corporations, so in what follows I shall mostly neglect the individual proprietors
and speak of corporate executives.
In a free-enterprise, private-property system, a corporate executive is an employee of the
owners of the business. He has direct responsibility to his employers.
That responsibility is to conduct the business in accordance with their desires, which
generally will be to make as much money as possible while conforming to their basic
rules of the society, both those embodied in law and those embodied in ethical
custom.
Of course, in some cases his employers may have a different objective
In either case, the key point is that, in his capacity as a corporate executive, the manager is
the agent of the individuals who own the corporation or establish the eleemosynary
institution, and his primary responsibility is to them.
Needless to say, this does not mean that it is easy to judge how well he is performing
his task. But at least the criterion of performance is straight-forward, and the persons
among whom a voluntary contractual arrangement exists are clearly defined.
, As a person, he may have many other responsibilities that he recognizes or assumes
voluntarily--to his family, his conscience, his feelings of charity, his church, his clubs, his city,
his country. He may feel impelled by these responsibilities to devote part of his income to
causes he regards as worthy, to refuse to work for particular corporations, even to leave his
job, for example, to join his country's armed forces.
If we wish, we may refer to some of these responsibilities as "social responsibilities."
But in these respects he is acting as a principal, not an agent; he is spending his own
money or time or energy, not the money of his employers or the time or energy he
has contracted to devote to their purposes.
If these are "social responsibilities," they are the social responsibilities of
individuals, not business.
What does it mean to say that the corporate executive has a "social responsibility" in his
capacity as a businessman? If this statement is not pure rhetoric, it must mean that he is to
act in some way that is not in the interest of his employers.
For example, that he is to refrain from increasing the price of the product in order to
contribute to the social objective of preventing inflation, even though a price increase
would be in the best interests of the corporation.
Or that he is to make expenditures on reducing pollution beyond the amount that is in
the best interests of the corporation or that is required by law in order to contribute to
the social objective of improving the environment.
Or that, at the expense of corporate profits, he is to hire "hardcore" unemployed
workers instead of better qualified available workmen to contribute to the social
objective of reducing poverty.
In each of these cases, the corporate executive would be spending someone else's money
for a general social interest. Insofar as his actions in accord with his "social responsibility"
reduce returns to stockholders, he is spending their money.
- Insofar as his actions raise the price to customers, he is spending the customers'
money. Insofar as his actions lower the wages of some employees, he is spending
their money.
The executive is exercising a distinct "social responsibility," rather than serving as an agent
of the stockholders or the customers or the employees, only if he spends the money in a
different way than they would have spent it.
This process raises political questions on two levels:
1. Principle and
2. Consequences.
On the level of political principle, the imposition of taxes and the expenditure of tax
proceeds are governmental functions.
Here the businessman--self-selected or appointed directly or indirectly by stockholders--is to
be simultaneously legislator, executive and jurist. He is to decide whom to tax by how
much and for what purpose, and he is to spend the proceeds--all this guided only by general
