It was American economist Howard Bowen who gave it a clear identity. However, a question remains unanswered: how does the term get accepted in the whole world? After the effort of Howard Bowen, there was a sort of lull period for the next few decades. But ins, many other economists focused on it.
In , University of Pittsburgh professor Donna J. Wood published Corporate Social Performance Revisited. He expanded and improved on early CSR models by providing a framework for assessing the impacts and outcomes of CSR programs. In the same year, another professor at the University of Georgia Archie B. This platform is committed to highlight and share the best practices in the CSR domain in India and also bring inspiring stories in the field of CSR from across the world.
A brief history: How CSR came into existence? By Shrishti Rao - Aug 19, Related Articles. By the s, early CSR continued to evolve as more organizations began incorporating social interests in their business practices while becoming more responsive to stakeholders. The s marked the beginning of widespread approval of CSR. In , University of Pittsburgh professor Donna J. In the same year, business management author and professor at the University of Georgia Archie B. In his paper, Carroll expanded on areas he believed were crucial when implementing CSR in an organization.
By the early s, CSR had become an essential strategy for many organizations, with multi-million dollar companies , such as Wells Fargo, Coca-Cola, Walt Disney, and Pfizer incorporating this concept into their businesses processes. With governments reducing their role in regulating corporate behavior, managers were faced with a need to answer to different interest groups that still expected corporations to fulfill the social expectations of the time.
Notably, the reduced regulatory framework led scholars to look into business ethics and the operationalization of CSR as a response to groups such as shareholders, employees and consumers, and the term stakeholder became common Carroll ; Wankel However, scholars also begun looking into alternative or complementary concepts to CSR, some of which include corporate social performance, corporate social responsiveness, and stakeholder theory and management Carroll For the purpose of this paper we will continue to focus our attention on the development of CSR as a definitional construct.
In , Thomas M. Jones was arguably the first author to consider CSR as a decision making process that influence corporate behavior. This translated into the creation of new frameworks, models, and methods aimed at evaluating CSR from an operational perspective.
Notably, these concerns can be observed in a series of events that reflected the approach of the international community towards sustainable development and to a certain extent, to corporate behavior. Even when these events did not relate directly to CSR, and hence did not influence directly the evolution of the concept, they reflected a growing sense of awareness of the international community with regards to environmental protection and sustainable development, and indirectly to corporate behavior.
The creation of these international bodies and the adoption of international agreements represented international efforts for setting higher standards with regards to climate-related issues and, indirectly to corporate behavior see: Union of Concerned Scientists For these global corporations it meant new opportunities that came along with a rising global competition for new markets, an increased reputational risk due to a growth in global visibility, and conflicting pressures, demands, and expectations from the home and the host countries Carroll Many multinational corporations understood that being socially responsible had the potential to be a safe pathway to balance the challenges and opportunities of the globalization process they were experiencing and as a result, the institutionalization of CSR became stronger Carroll Wood , driven by what she saw as a need for a systematical integration of conceptual aspects into a unified theory, built on the models of Carroll and Wartick and Cochran to create a model of Corporate Social Performance CSP.
Wood defined three dimensions of CSP: first, the principles of Corporate Social Responsibility, which include legitimacy institutional level , public responsibility organizational level , and managerial discretion individual level. Second, she defined the processes of corporate social responsiveness as environmental assessment, stakeholder management, and issues management.
Third, she specified the outcomes of corporate behavior as social impacts, social programs, and social policies. Furthermore, Burke and Logsdon argued that the implementation of strategic CSR through these five dimensions would translate into strategic outcome in the form of value creation that can be identifiable and measurable, but limited to economic benefits for the firm.
Later, Elkington explained that the way to achieve an outstanding triple bottom line performance social, environmental, and economic is through effective and long-term partnerships between the private and public sectors, and also among stakeholders.
Footnote 4. This gave way to alternative subjects such as stakeholder theory see: Donaldson and Preston ; Freeman , corporate social performance see: Swanson , and corporate citizenship see: Carroll The first section is focused on the recognition and expansion of CSR and its implementation, while the second section is focused on the strategic approach to CSR provided by the academic publications of the time.
The debate around CSR has been brought forward several times by public figures. Notably, the idea behind the creation of the UNGC was to create an instrument that would fill the gaps in governance of the time in terms of human rights and social and environmental issues and to insert universal values into the markets United Nations Global Compact n.
Perhaps the most notable achievement of the UNGC was the definition of ten principles that guide the corporate behavior of its members, who are expected to incorporate them into their strategies, policies and procedures with the aim of creating a corporate culture of integrity with long term aims United Nations Global Compact n. Even when the UNGC was never directly linked to CSR, it can be understood that the ten principles, with their focus on human rights, labor, environment, and anti-corruption, brought the global attention towards social responsibility.
The promotion of CSR as a distinct European strategy begun 1 year after the adoption of the MDGs and the creation of the UNGC, when the EC presented a Green Paper called Promoting a European framework for Corporate Social Responsibility which derived from the new social expectations and concerns of the time, including the growing concern about the environmental impact of economic activities Commission of the European Communities In practical terms, these events translated into a unified vision and understanding of CSR that would be promoted around European businesses.
In , the EC published the renewed European Union EU strategy for CSR for the years — followed by a public consultation in with regards to its achievements, shortcomings, and future challenges. The Manifesto focuses on the generation of value on five key areas: 1 societal impact through the promotion of responsible and sustainable business practices; 2 membership engagement and satisfaction which is meant to guarantee the continuity in the work of CSR Europe to achieve its mission and societal impact; 3 financial stability; 4 employee engagement focused on the investment of individual development as well as organizational capacity, and; 5 environmental impact assessment to determine areas of improvement CSR Europe The global recognition of CSR has also been influenced by international certifications designed to address social responsibility.
The development of the ISO is of relevance for the CSR movement not only because it serves as a guideline for the way in which businesses can operate in a socially responsible way, but more so because it was developed by experts of 99 countries and 40 international organizations and so far it has been adopted by more than 80 countries as a guideline for national standards ISO n.
In the early years of the twenty-first century, Craig Smith explained that corporate policies had changed as a response to public interest and as a result this often had a positive social impact.
This was reaffirmed by Lantos that same year, who pointed out that during the twenty-first century society would demand corporations to make social issues part of their strategies see also: Carroll Friedman and Miles provided a new perspective to stakeholder theory which reinforced the belief that corporations should be managed in the benefit of a broader set of stakeholders. Freeman argued that corporations have a responsibility towards suppliers, consumers, employees, stockholders and the local community and as a result should be managed accordingly while A.
Friedman and Miles defined that the relation between corporations and their stakeholders is dynamic and has different levels of influence on the firm. With this new perspective, Freeman and A. Friedman and Miles contributed to the CSR evolution by reinforcing the belief that corporations are responsible to a broader set of stakeholder than before.
Marrewijk explained this new societal approach to CSR as a strategic response to the new corporate challenges which, as he explained, are an outcome of the evolution of the roles and responsibilities of each sector of society [emphasis added].
Accordingly, Marrewijk gave five interpretations to his concept of Corporate Sustainability, which he recognized as the contemporary understanding of CSR. The holistic interpretation provided by Marrewijk is perhaps the most relevant for the purpose of this paper because it represents the full integration of CSR motivated by the search for sustainability in the understanding that companies have a new role within society and consequently have to make strategic decisions to adapt to its social context.
The strategic response that companies make to their evolving social context was further explored by Werther and Chandler who, with their first work published together, focused on the implementation of strategic CSR as part of brand management in order to achieve and maintain legitimacy in a context of globalized brands. Even when their approach to SCSR focused mainly on the competitiveness and legitimacy of companies, their main contribution comes from explicitly claiming CSR as a strategic necessity and thus making it indispensable for any corporation.
For Porter and Kramer , a company should first look inside out to map the social impact of its value chain and identify the positive and negative effect of its activities on society and then focus on the ones with the greatest strategic value.
Then, the firm should look outside in to understand the influence of their social context on their productivity and on the execution of its business strategy Porter and Kramer This way, corporations would be able to understand its interrelationship with their social environment and be able to adapt its business strategies Porter and Kramer In fact, Porter and Kramer argued that if CSR is used without a holistic approach and only focused on certain objectives e.
It is important to highlight that Husted and Allen left out the concept of voluntarism proposed by Burke and Logsdon from their definition of strategic CSR but pointed out its relevance as a key dimension in CSR for the creation of value. Their findings show that visibility, in terms of the presence of CSR on the media as well as a positive image of the company, can be linked to the creation of value through increased customer loyalty and the attraction of new customers, as well as developing new areas of opportunity for products and markets Husted and Allen With regards to appropriability, the way in which the company manages to retain the value created, Husted and Allen pointed out that the surveyed companies designed their CSR policies with the aim of creating value, but such value seems to be limited to the economic benefits of the companies themselves and not necessarily for all their stakeholders.
Finally, Husted and Allen acknowledged voluntarism, the strategic management of socially-oriented policies going beyond legal requirements, as a key aspect for the creation of value. Nevertheless, their findings show that the surveyed firms were not implementing CSR policies beyond the legal requirements which might be the consequence of the intangibility and immeasurability of such activities Husted and Allen Furthermore, the most relevant contributions provided by Husted and Allen to the concept of SCSR are twofold: first, SCSR generates new areas of opportunity through the constant drive for creating value, which in turns results in innovation.
Second, implementing SCSR with the aim of creating value is inevitably linked to social demands. However, Husted and Allen pointed out that the surveyed companies looked into the generation of value with a perspective limited the economic benefits of the corporations themselves and not necessarily for all their stakeholders which raises the question if those companies were in fact implementing CSR with a holistic approach.
The belief of achieving competitive advantage and creating value through SCSR was further developed by Heslin and Ochoa who claimed that even when SCSR practices are most effective when they are tailor made, they still follow common principles. To prove their hypothesis, Heslin and Ochoa analyzed 21 exemplary CSR practices and observed that seven common principles guide the strategic CSR approach of the selected companies: cultivate the needed talent, develop new markets, protect labor welfare, reduce the environmental footprint, profit from by-products, involve customers, and green the supply chain.
The relevance of the principles proposed by Heslin and Ochoa comes from the belief that companies can improve their business opportunities while they provide benefits to the social context in which they operate.
For instance, to cultivate the needed talent is explained as the need of companies to foster and retain qualified and skilled employees which result in better and more stable career opportunities Heslin and Ochoa Likewise, the strategic relevance of the protection of labor welfare relies not only on the prevention of child labor but on the creation of innovative solutions for the company-specific social context Footnote 6 Heslin and Ochoa The exemplary SCSR practices presented by Heslin and Ochoa provide an insight of the potential benefits of SCSR for creating shared value, for the companies themselves, their stakeholders, and the social context in which the firms operate.
Accordingly, Porter and Kramer established three ways for creating shared value: by reconceiving products and markets, by redefining productivity in the value chain, and by creating supportive industry clusters where the company operates. Even when Porter and Kramer did not contribute directly to the concept of CSR, they called for a change in the business strategies which, in their opinion, should now focus on generating shared valued as a main objective. This perspective of the creation of shared value is evident on what Leila Trapp called the third generation of CSR, which she explained as the moment in which corporations reflect their concerns about social and global issues on their activities, even when some of those concerns might not be directly linked to their core business.
Even when this might seem similar to the philanthropic responsibilities of companies, defined as the fourth level of the Pyramid of CSR proposed by Carroll , it is in fact rooted on a different understanding of the roles of corporations within their social context.
For Carroll , companies which engage on activities to improve the social context in which they operate are doing so with a philanthropic perspective that is discretionary and voluntary, and as a result, this perspective is less relevant than the other three categories proposed in the Pyramid of CSR.
In contrast, Trapp built on the historical understanding of CSR proposed by Marrewijk to explain what she called the third generation of CSR as an outcome of the evolution of the roles and responsibilities of each sector of society in which the private, public and social sectors have become increasingly interdependent.
Then, the third generation of CSR proposed by Trapp can be understood as the result of corporations acknowledging and assuming their new roles and responsibilities towards society. Trapp exemplified the third generation of CSR through a case study of Vattenfall, the Swedish state-owned energy company that in launched a CSR-backed stakeholder engagement campaign focused on climate change mitigation.
With this, Trapp contributed to the concept of CSR by exemplifying the new roles and responsibilities that corporations are willing to take in order to generate shared value. In fact, in the third edition of the book Chandler and Werther claim that SCSR has the potential for generating sustainable value and that the first step to do so is by identifying the social problems for which the company can create a market-based solution in an efficient and socially responsible way.
What is evident from this edition, is that Chandler understands the generation of sustainable value as one of the main objectives of SCSR. A key contribution from Chandler and Werther is their definition of SCSR which is the result of their exploration of CSR and their pragmatic approach to its effective implementation.
Instead, companies should aim at optimizing value over the long term by focusing on their areas of expertise and by doing so there would be a reorientation of efforts towards the creation of shared value instead of profit maximization Chandler To do so, an essential aspect of SCSR is the integration of the five components into a corporate framework that sets the parameters for the decision making process as well as their integration into the corporate culture with clear guiding values Chandler In , Carroll resumed his work on CSR with an overview of the evolution of the concept which complemented his literature review of and of see: Carroll ; Carroll and Shabana , but this time he looked at the competing and complementary concepts that have become part of the modern business vocabulary.
Carroll reviewed the concepts of stakeholder engagement and management, business ethics, corporate citizenship, corporate sustainability, and the creation of shared value and concluded that all of them are interrelated and overlapping.
Notably, Carroll pointed out that all of these concepts have been incorporated into CSR which is the reason why he defines it as the benchmark and central piece of the socially responsible business movement see: Chandler and Werther ; Heslin and Ochoa ; Trapp Even when the SDGs do not represent any commitments for the private sector, the countries that adopt them will have to create specific policies and regulations that will translate into pressure for firms to implement new business practices or to improve their current ones.
This is particularly relevant considering that the SDGs cover a wide range of areas, from climate change to the eradication poverty and hunger, as well as the fostering of innovation and sustainable consumption. Beyond that, the SDGs are interconnected, which means that addressing one particular goal can involve tackling issues of another one UNDP This context presents an opportunity for CSR and SCSR to continue growing in terms of conceptualization and implementation, mainly because businesses can adopt it as a strategic framework with the objective of creating shared value see: Chandler The expansion is particularly notable within the academic literature where it is possible to see that since the number of academic publications around CSR has increased considerably see Table 1.
As can be seen in Table 1 , in the case of Science Direct, the publications more than doubled from in the year to in 2. In the case of ProQuest the publications increased considerably from to passing from to , but decreased to in It is also important to notice that the years and had the highest amount of publications around CSR this far. It is also relevant to observe that the number of publications declined after for Science Direct and after for Proquest, while for Web of Science the amount kept growing.
The increase in the number of publications is not necessarily linked to the launch of the SDGs, but it shows that the concept has remained relevant after the year , when the Paris Agreement called for a change from business as usual to new business frameworks. The aim of this paper is to provide a distinctive historical perspective on the evolution of CSR as a conceptual paradigm through a literature review of the academic contributions to the concept as well as the most relevant factors that have shaped its understanding and definition.
As a result, a new rationale was brought forward by the Committee for Economic Development of the USA based on the premise that the social contract between business and society was evolving and that the private sector was expected to assume broader social responsibilities than before.
Its growing popularity led to the unrestricted use of the term CSR under different contexts and by the end of the decade the concept became unclear and meant something different for everyone. Perhaps the first unified definition of CSR was presented in by Carroll , who placed specific responsibilities and expectations economic, legal, ethical and discretionary upon corporations and who understood the economic and social objectives of firms as an integral part of a business framework and not as incompatible aspects.
It was also during this period when the adoption of international agreements on sustainable development reflected, to a certain extent, a growing a sense of awareness with respect to the impact of corporate behavior e.
This represented a change in the understanding of CSR and as a result, international organizations and companies alike saw CSR as a way to balance the challenges and opportunities of the time and its institutionalization begun spreading globally. It was also during this period that alternative subjects gained attention such as stakeholder theory, corporate social performance and corporate citizenship, and even when they were consistent with the prevailing CSR understanding, their use created an uncertainty with regards to the definition of CSR and by the end of the decade the concept lacked a globally accepted definition and unclear boundaries as explained by Lantos In the year , the adoption of the MDGs and the creation of the UNGC gave a new dimension to the understanding of social responsibility in which broader responsibilities were placed on corporations, mainly in terms of human and labor rights, environment, anti-corruption and sustainable development.
As a result, international institutions, such as the EC, saw in CSR a pathway for addressing the new corporate challenges, which translated into a wider recognition of the concept during the first decade of the twenty-first century. Since then, the literature around CSR has focused on its implementation and its impact on specific areas of performance which can be linked to a certain extent to the SDGs while the understanding of CSR has remained centered on its potential to generate shared value.
At this point in the paper, it is relevant to visualize the most significant academic contributions to the evolution of Corporate Social Responsibility as a conceptual paradigm. To do so, Fig. It is important to notice that the figures are based on this literature review and do not attempt to represent all the contributions to the evolution of the academic understanding of CSR but only to provide a visual synthesis. Evolution of the academic understanding of CSR. Source: Developed by the authors as a synthesis of the academic literature.
As can be seen in Fig. Perhaps more relevant is the fact that the discussion around what those responsibilities are still continues to this day. Another key aspect that can be visualized with Fig. With Figs. The relevance of these figures comes from placing the events that played a significant role in shaping the understanding of CSR within the evolutionary process of the concept, some of them linked to the sustainable development agenda.
This graphic synthesis of the evolutionary process of CSR is helpful for observing that the CSR understanding has been influenced by academic publications, governmental decisions such as the creation of legislations and entities , social movements, public figures, and international movements.
More so, from this graphic representation it is possible to observe that the understanding of social responsibility is dynamic and responds to social expectations of corporate behavior.
Visual history of CSR Part 1 of 2. Source: Developed by the authors based on this literature review. Note: the size of the circles is a subjective representation of the level of influence each aspect had on the evolution of CSR. Hence, a bigger circle represents a higher level of influence.
Visual history of CSR Part 2 of 2. The aim of this paper was to provide a distinctive historical perspective on the evolution of CSR which was fulfilled through an exhaustive literature review that shows that the definition and concept of Corporate Social Responsibility has evolved from being limited to the generation of profits to the belief that companies should focus on generating shared value.
Even when this is not entirely evident across the history of the concept, there are specific cases in which the understanding of CSR clearly reflects the social expectations of the time. A notable example is the publication of A New Rationale for Corporate Social Policy and the Social Responsibilities of Business Corporations by the Committee for Economic Development of the USA which were followed by the creation of governmental institutions as a clear response to the social momentum and social demands of corporate behavior of the time.
Since then, the definitions and understanding of CSR evolved for the most part in a pragmatic way according to social expectations. This belief, of creating shared value through SCSR, is perhaps the most relevant example of how the understanding of CSR reflects the social expectations of the time. From this review it is possible to see ties between some of the events of the sustainable development agenda and the evolution of CSR.
Perhaps these two examples are isolated cases in which specific international events had a direct influence on the understanding and implementation of CSR, but they show that the evolution of CSR can be influenced by international events and not only by academic contributions. The theoretical contributions of this paper to the literature on CSR begin by providing a distinct historical review of the evolution of the academic understanding of the concept along with the public and international events that played a role in shaping social expectations with regards to corporate behavior.
A key contribution comes from the chronological timeline established through the paper with which it is possible to observe the way the concept evolved, an aspect that can be clearly visualized through the figures presented by the authors.
As a literature review, the paper is limited to the academic publications that refer directly to CSR as well as to information regarding those events that have influenced to some extents the social expectations of corporate behavior.
The findings show that there is a link between social expectations of corporate behavior and the way in which CSR is understood and implemented and opens room for future research. From this review it is possible to see that the literature on CSR seems to be lacking specific research with regards to how to address the core business activities through CSR and seems to point out a reason why CSR can be implemented only partially and even may raise questions about its potential benefits.
Beyond that, this paper has practical contributions that can be used as the basis for exploring how CSR can address the latest social expectations of generating shared value as a main business objective, which can translate into practical implications if CSR is implemented with the objective of creating shared value, a topic that only few authors have discussed. Carroll in still prevails. In this scenario Carroll foresees an increase in: stakeholder engagement, prevalence and power of ethically sensitive consumers, the level of sophistication of non-governmental organizations NGOs , employees as a CSR driving-force, along with increased CSR activity up, down, and across the global supply chain.
With regards to the concept itself, Carroll expects CSR to continue its transactional path but to have a limited transformational evolution. While this scenario seems plausible and highly probable, perhaps it would be necessary to add to it that even when CSR is still relevant and its implementation keeps expanding, at least in the literature, there are competing frameworks and new concepts that might slow the global expansion and implementation of CSR and even shift the public interest towards new areas.
However, it is relevant to highlight Archie B. Only time will tell if the institutionalization of CSR continues to expand or if the interest shifts towards other concepts. The future of CSR will also have to take into consideration the latest technological advances and their role as part of new business frameworks and strategies.
The adoption and adaptation to new digitalization processes and tools, as well as the incorporation of Artificial Intelligence into the business environment are relevant challenges not only for the CSR debate, but for corporations in general.
In this sense, business frameworks will have to adapt and evolve in order to embrace the latest tools, but they will need to do so through an overarching and holistic framework that is based on the principles of social responsibility in a way that it combines the notions of sustainability, the generation of shared value, and the belief that companies can redefine their purpose to do what is best for the world.
Chaffee goes into detail to explain the evolution of corporations under the English Crown and also their evolution in the USA where they became subject of legislatures after the Revolutionary War but still kept relatively social functions. For interview requests with the author, or for permission to republish, please contact outreach gatewayhouse. All rights reserved. Any unauthorized copying or reproduction is strictly prohibited.
How did CSR work pre? In the context of a shrinking State, a more globalised economy, and great divisions in economic and social worlds, the landscape of Indian CSR is fascinating Gateway House and Lehigh University, Pennsylvania, U.
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