article review on business ethics and corporate social responsibility

Corporate social responsibility versus business ethics: analysis of employee-related policies

Social Responsibility Journal

ISSN : 1747-1117

Article publication date: 19 December 2022

Issue publication date: 4 January 2024

This study aims to analyze the relationship between companies’ business ethics (BE) and corporate social responsibility (CSR), with particular reference to policies toward employees, with the aim of understanding if and how the two concepts are linked and to foster a better management of the company-employee relationship through BE and CSR policies.

Design/methodology/approach

Through a content analysis, the authors study three issues related to employees disclosed in Code of Ethics (CE) and CSR report of a sample of Italian companies. Next, using a multivariate regression model, the authors examine the relation between the BE and CSR initiatives, related to employees.

The findings show that CE and CSR initiatives are negatively related. They are distinct concepts, but since the authors find that they are connected, they must also be considered in terms of their mutual dependence. To standardize practices toward employees in a code may induce the need to establish additional corporate social responsibility initiatives that elicit legitimate stakeholder satisfaction.

Research limitations/implications

The analysis focuses on employees, whereas several other CSR aspects that can be explored. Furthermore, additional investigation (through questionnaires or interviews) could deepen this analysis. Furthermore, it might be interesting to consider different countries or more variables, such as cultural differences or different regulations.

Practical implications

The results of this research reveal that BE and CSR initiatives require precise and personalized observations to be properly understood; however, as they are linked, they must also be studied in their mutual interdependencies; this can be very useful to define governance bodies and organizational procedures devoted to BE and CSR issues.

Social implications

This research provides a tool for evaluating and monitoring CSR and BE principles and can be adapted to many business contexts and refer to different stakeholders.

Originality/value

The existing literature on BE and CSR presents opportunities for further study, as these concepts are often studied without insights into their mutual impacts.

• Business ethics
• Corporate social responsibility
• Code of ethics

Furlotti, K. and Mazza, T. (2024), "Corporate social responsibility versus business ethics: analysis of employee-related policies", Social Responsibility Journal , Vol. 20 No. 1, pp. 20-37. https://doi.org/10.1108/SRJ-06-2022-0232

Emerald Publishing Limited

Copyright © 2022, Katia Furlotti and Tatiana Mazza.

Published by Emerald Publishing Limited. This article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial & non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this licence may be seen at http://creativecommons.org/licences/by/4.0/legalcode

Introduction

Researchers have been studying the function and importance of business in society for decades ( Carroll, 1991 ; Schwartz and Carroll, 2008 ), often considering both a company’s responsibilities toward all its stakeholders (CSR – corporate social responsibility) ( Freeman et al. , 2010 ) and the ethical aspects of companies’ activities (BE – business ethics) ( Crane et al. , 2010 ). Many authors frequently use the terms BE and CSR to represent the same aspect of business activity, even though the two concepts are different ( Weller, 2020 ). Weller (2020) , starting from Fischer (2004) and integrating Schwartz and Carroll (2008) , suggests three possible interpretations of the relationship between CSR and BE: CSR and BE are equivalent , CSR and BE are each part of the other and CSR and BE are distinct but related .

We consider a specific BE and CSR perspective relate to companies’ employees. The BE and CSR literature, in fact, frequently overlooks employees even though they are key stakeholders ( Hansen et al. , 2011 ; Pedersen, 2011 ). Few studies analyze BE and CSR from the employee perspective ( O’Dwyer and Madden, 2006 ; Mazza and Furlotti, 2020 ). We contribute to this stream of literature by conducting an analysis of employee-related policies.

Considering previous literature, we want to verify the existence of a relationship between BE and CSR with reference to the companies’ policies toward the stakeholder employee.

To analyze this relationship, we study the disclosure about the issues voluntarily produced by companies, in particular, the Code of Ethics (CE), expression of BE and the social or sustainability report, as expression of CSR.

So, we analyze the relation between BE and CSR employee-related policies with an empirical approach.

Using an Italian sample of listed firms that voluntarily disclose employee-related policies in documents containing social, sustainability or integrated reports and include such policies in their codes of conduct or codes of ethics, we perform a manual content analysis. We use the methodology used in the literature to define keywords and scales and search the examined content for employee-related policies related to the three most important and frequently disclosed issues involving employees: employee health and safety, learning and development opportunities and equal employment opportunities. Next, we perform a multivariate regression analysis to test the relation between BE and CSR.

The primary contribution of our research is the presentation of univariate results of content analysis involving various documents of voluntary disclosure. We aim to provide the first explorative indications of the type of disclosure differentiated by such documents and by the concept of BE and CSR.

We find that in the examined voluntary CEs and CSR reports, employee health and safety and employment opportunities are always included, while learning and development opportunities may not be considered. The disclosures on learning and development opportunities contrast with those on employee health and safety. There is more differentiation in the CEs than in the CSR reports on learning and development opportunities, while there is more differentiation in the CSR reports on employee health and safety. A measurable result is always included in the voluntary CSR disclosures on learning and development opportunities, while there are some firms that do not disclose data on employee health and safety. However, in the CSR reports, detailed disclosures on learning and development opportunities are not frequently given, but those on employee health and safety are often provided.

The secondary contribution of our research is the presentation of multivariate results of a regression analysis on the relation between CSR and BE. We study the statistical significance of this relation and its direction. We aim to contribute to the debate on the interpretations of the relationship between CSR and BE by portraying these factors as equivalent , each part of the other or distinct but related ( Weller, 2020 ).

We find that these factors are distinct and negatively related. If companies have good BE policies regarding health and safety and learning and development opportunities, there is little need to provide additional disclosures in voluntary CSR documents about specific strategic initiatives.

Corporate social responsibility and business ethics: theoretical framework and hypothesis development

CSR refers to the responsibility that companies assume for all their stakeholders, who may be investors or any other individuals or groups that have stakes in companies ( Balluchi and Furlotti, 2013 ; Gössling and Vocht, 2007 ). According to the 2001 European Commission Green Paper, promoting a European framework for CSR can be defined as “a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis.” In most of the existing CSR definitions, it is possible to find, in addition to a mention of the relevance of stakeholders, an implicit reference to BE ( Schmidheiny et al. , 1997 ). In this respect, CSR can be viewed as the right thing to do ( Allen and Peloza, 2015 ).

Regarding BE, Lewis (1985) analyses the most often used definition of the concept, particularly in the context of business research, finally concluding that “business ethics is rules, standards, codes, or principles which provide guidelines for morally right behavior and truthfulness in specific situations.” He underlines the main aspects of this concept: rules, standards and codes or principles , which represent ethical rules for preventing unethical behavior; morally right behavior , which refers to individual actions that are in accordance with justice, laws or other standards; truthfulness , meaning indications and actions that conform with facts; and specific situations , which refers to the situations of individual ethical dilemmas necessitating ethical choices ( Lewis, 1985 , pp. 381–382). BE, therefore, is about much more than values or principles; it includes values, but it is concerned with moral rules, guidelines and codes about right and wrong conduct ( Harrison et al. , 2019 ). The establishment and formalization of a written document containing a set of rules that guide companies’ behaviors according to precise values and ethical principles are one of the most common ways to integrate ethics into the management practices of a company. In this respect, there is a growing tendency among companies to develop formal BE documents that also aim to guide and shape corporate culture. In the academic and professional worlds, these documents are generally designated as codes of ethics or codes of conduct and are documents that contain principles or rules that guide the ethical conduct of companies.

Focusing, in particular, on CSR/BE debate, Rusconi (2019) proposes an ethical firm system theory, starting from a joint and synergistic consideration of stakeholder management theory and firm system theory. In particular, the author proposes that stakeholder theory should be integrated into an ethical vision of firm theory, indicating that ethical duties are strictly linked to the management of a company as a whole. In his study, Rusconi (2019) focuses on ethical firm system theory to clarify or otherwise analyze or approach, the three central ethical points of stakeholder management theory: the dichotomy between economic performance and ethical behavior, stakeholder engagement and ethical responsibility and competition in a cooperative context.

Schwartz and Carroll (2008) study the concepts of CSR and BE, starting from their definitions and theoretical frameworks and calling for the establishment of a new, shared paradigm to explain the role of business in society and that of ethics in business. In this respect, they consider several theories, including moral agency theory ( Goodpaster and Matthews, 1982 ), social contract theory ( Donaldson, 1982 ), social power theory ( Davis, 1975 ), interpenetration theory ( Preston and Post, 1975 ), stakeholder theory ( Carroll, 1991 ; Freeman, 1984 ), property-based theory ( Hoffman and Fisher, 1990 ; Klonoski, 1986 ), utilitarian theory ( Den Uyl, 1984 ) and religious theory ( Pava, 1996 ). Another important theory in the field of CSR is institutional theory. According to this theory, external institutional pressures can explain how companies’ decisions are formed; individuals, in fact, generally seek approval, allowing themselves to be influenced by external expectations and pressures stemming from society and seeking endorsement through compliance with societal traditions and expectations ( Verbeke and Tung, 2013 ). Since companies are social constructions created and managed by individuals, institutional theory can be applied to businesses that are under three main kinds of pressure: cognitive, regulative and normative ( Scott, 1995 ). In particular, cognitive pressure usually stems from companies’ need to conform to the structures of their environments ( Scott, 1995 ).

In this context, an important area of study concerns the relations existing between CSR and BE, which are often studied through their respective disclosure tools: the CEs and the sustainability (or social/environmental) reports. In particular, CE is a tool in which the company makes explicit the foundations of its ethics and defines the rules of conduct that guide its operations, while social, environmental and sustainability reports are reporting documents in which companies describe what they have done in the field of CSR.

Many research studies have investigated the existing relationship and mutual connections between CSR and BE. Several authors, frequently use the two terms to represent the same aspect of business activity ( Fassin et al. , 2011 ; Ferrell, 2004 ; Pereira et al. , 2020 ), even though the two concepts are different ( Weller, 2020 ). Harrison et al. (2019) explain that although some authors suggest that there is a relationship between CSR and BE ( Epstein, 1987 ), others, even though they recognize the difference between ethics and CSR ( De Bakker et al. , 2005 ), consider these different elements under the single concept of CSR ( Choi and La, 2013 ) or characterize CSR as a dimension of BE ( De George, 1987 ). Schwartz and Carroll (2008) explain the existing confusion about these two concepts, providing several examples in which one of the concepts incorporates the other and highlighting studies in which these two terms are used to denote the same meaning. Additionally, the concept of CSR is often included in the general definition of ethics ( Joyner and Payne, 2002 ). Schwartz and Carroll (2008) try to address this misunderstanding, proposing that the concepts of value, balance and accountability should be used as a foundation for future debate and theoretical improvement about the role of business in society.

Mason and Simmons (2013) affirm the importance of distinguishing between CSR and BE. They review CSR literature to differentiate CSR and ethical business practices, theorizing BE as an internal expression of CSR; BE is the management’s answer to a company’s idea of CSR.

CSR and BE are equivalent because they can be conceptually considered as the same item applied to different contexts: BE is applied to people and employee conduct, while CSR is applied to organizations and business conduct toward outside entities ( Davidson and Griffin, 2000 ).

CSR or BE is part of the other , that state that BE is considered a part of CSR or, vice versa, that CSR is an aspect of BE. In this respect, for example, the CSR pyramid by Carroll (1991) encompasses economic, legal, ethical and philanthropic responsibilities (BE is a part of CSR); in turn, Goodpaster (1991) explains that companies’ responsibility toward all their stakeholders is a fundamental principle of BE (CSR is a part of BE).

CSR and BE are distinct but relate because not only of the different purposes for and reasons underlying BE and CSR but also for an awareness of their mutual influences and importance to each other.

This paper contributes to the BE and CSR literature by exploring a particular aspect of the relationship between these two concepts. The research analyses, in particular, the relationship between BE, which is assessed according to the definitions of the ethical policies in a code (a CE), and CSR, which is measured by the quality of the information provided about CE policies related to a specific stakeholder: employees. This research considers employees because they are key company stakeholders ( Pedersen, 2011 ) but are frequently overlooked in the CSR and BE literature ( Hansen et al. , 2011 ). Few studies analyze BE and CSR from an employee perspective ( O’Dwyer and Madden, 2006 ). Simmons (2008) analyses the role of CSR in the context of employee governance; Romi et al. (2018) focus on employee in the B corporations whose owners voluntarily commit to conduct business in a socially responsible manner; Snell et al. (2010) find that clear ethical rules simplify this discussion and can facilitate interactive justice among employees; Fatma et al. (2018) use surveys to obtain employee perceptions of CSR; Chantziaras et al. (2021) examine the relationship between CSR disclosures and organized labor. Regarding BE and CE, several researchers analyze the impact of CE on different aspects of employees’ interests, such as work climate ( Manley, 1991 ), humane working conditions ( Williams and Murphy, 1990 ) and company values ( Weaver, 1993 ). Some authors focus, in particular, on CE characteristics. Ahmad et al. (2019) study the link between CEs and job and work engagement. Houghton et al. (2009) examine employee behavior and investigate the connection between volunteerism and compliance with the CE of a company ( Weller, 2020 ).

Starting from these premises and in the path of this literature, we consider the relation between CSR and BE and study the statistical significance and direction of this relation. In particular, we consider the CEs, the document that summarizes the ethical approach of companies in business activity, and the CSR report, the disclosure document by which a company describes its CSR strategies and actions. According to previous literature ( Mason and Simmons, 2013 ), we consider BE as an expression of CSR, so CE can be considered a management’s answer to a company’s idea of CSR.

CE policies about employee have a significant relationship with companies’ CSR strategies about employee.

Methodology

Multivariate regression models.

To test our hypotheses, we use ordered probit regressions with robust standard errors:

3*3 (1) C E   p r o c e d u r e = β 1   C S R   d i s c l o s u r e   o n   p r o c e d u r e s   a n d   p e r f o r m a n c e +   c o n t r o l   v a r i a b l e s   +   e

As previous literature suggests ( Mason and Simmons, 2013 ), we consider the BE dependent on CSR because the ethical principle and rules are an expression of a companies’ precise vision of corporate responsibility in the context in which they operate (environmental and social as well as economic).

Size: the natural logarithm of total assets at the end of each fiscal year;

Loss: 1 if net income < 0 and 0 otherwise;

ROE: ratio of net income to equity;

Leverage: long-term debts/total assets;

Sales growth: (revenue t − revenue t− 1 ) scaled by revenue t− 1 for fiscal year t .

CE procedures related to employees encompass the following topics: health and safety, learning and development opportunities and equal employment opportunities.

These topics are identified starting from the 10 categories defined by Spiller (2000) for employees. We select those most significant in the Italian context. For the selection, we exclude the categories which in Italy are regulated by law and, therefore, little dealt with in the CE, such as remuneration, communication and job security. We also reject those topics which suffer from high subjectivity in characterization and for which standardization by keywords is ineffective, such as fulfilling work, competent leadership, community spirit and social mission integration. The selected categories, therefore, concern learning and development opportunities, a healthy and safe work environment and equal employment opportunities. These categories are also found to be the most significant in terms of ethical codes and employees in previous research studies ( Mazza and Furlotti, 2020 ).

Sample selection, data collection and content analysis

The sample selection process ( Table 1 ) starts with all the Italian companies listed on the Milan Stock Exchange that are available on Compustat Global. We exclude the financial sector from our analysis because of its dissimilar nature and because of the specific Italian normative and standard of CSR disclosure, compulsory for financial firms.

We download the CSR reports of the firms in the CE sample in any format (social, sustainability or integrated reports). We find 55 firms with CSR reports. This is coherent with the results corresponding to the following questions in the ASSET4 database: CGVSO05V, corporate governance; indicator value, value vision and strategy/transparency – “Does the company publish a separate CSR/H&S/Sustainability report or publish a section in its annual report on CSR/H&S/Sustainability?” and CGVSDP026, corporate governance; datapoint, CSR sustainability reporting – “Does the company publish a separate CSR/H&S/Sustainability report or publish a section in its annual report on CSR/H&S/Sustainability?”. ASSET4 shows that 26 nonfinancial listed Italian firms have CSR reports. ASSET4 covers a portion of the Italian population of firms.

The sample is unbalanced, with a total of 129 firm-year observations; the majority of these observations come from the most recent year, namely, 2016 ( Table 2 ). Most of the firms ( Table 2 ) prepare sustainability reports (115 observations). Six firms provide social reports. Only eight integrated reports are found, which is consistent with previous Italian literature on this subject [nine were found in Paolucci and Cerioni (2017) ; five were found in Camodeca and Almici (2017) ]. Most of the firms ( Table 3 ) are in the transportation, communications, electric, gas and sanitary services industries, and these are followed by firms in the manufacturing industry.

The analyzed documents refer to the period 2014–2016. This time period occurs before the introduction in Italy of Legislative Decree 254/2016, which establishes regulatory requirements about nonfinancial disclosure for some categories of companies, in particular regarding employees and environment. The choice of this period, therefore, allows to analyze employee information without influences due to the introduction of regulatory requirements.

The examined period considers three years because in November 2012 in Italy, the so-called “legality rating” was introduced (Law Decree 1/2012), which allows companies to be rewarded for demonstrating compliance with increasingly high standards of legality, for example, in the case of tenders with public administrations or when accessing credit. In this contest, even in the absence of specific obligations, ethical and CSR choices represent an element capable of increasing the score assigned to companies. So companies are encouraged to design, carry out (and report) ethical and CSR issues in their strategies. The rating is updated every two years and we, therefore, considered a three-year period that could be characterized by greater variability in the CSR and CE choices of companies, though the decree does not recommend specific ethics or CSR rule or strategies, just underlining their importance.

We download all the CEs of the examined firms, and we hand collect data on their CE policies using keywords. Appendix 1 shows the sample scoring criteria used to analyze the CEs, including a list of the Italian keywords used, their English translations and an interpretation of the level name. We use a content analysis based on keywords as prior literature ( Campopiano and De Massis, 2015 ; Liao et al. , 2018 ).

The procedures on employee health and safety are coded according to a scale ranging from 0 to 4 that categorizes the keywords into groups related to safety; related to safety and health; related to health, safety and the environment; and related to accident care. The procedures on learning (training) and development (career) opportunities are coded according to a scale ranging from 0 to 4 that categorizes the keywords into groups related to training; related to training and opportunities; related to training, opportunities and professional growth; and related to training types. The procedures on equal employment opportunities are coded according to a scale ranging from 0 to 4 that categorizes the keywords into groups related to equal opportunities in general, related to equal opportunities within specific categories (the most frequent is handicap care) and related to race/religion safeguards and sex nondiscrimination.

CSR disclosures on procedures and performance concern the following topics: number of employee injuries and the related procedures (employee health and safety), number of training hours and career evaluations (learning and development opportunities) and the corresponding procedures, number of people in minority groups (equal employment opportunities) and the associated procedures. We download the firms’ CSR reports for each year. We hand collect data based on an ordered variable schema. Appendix 2 shows the sample scoring criteria from Sethi et al. (2017) with an explanation of the level order.

The disclosures on procedures and performance regarding the number of employee injuries in each firm are coded according to a scale ranging from 0 to 4 based on the criteria of disclosure in Sethi et al. (2017) (zero, minimum, measurable, comparison or exceptional disclosure) related to safety injuries. The same type of coding is used for the other CSR disclosures by changing the topic of disclosure. For learning and development, we investigate assessments of competences and training. These disclosures are related to an assessment of the links between competences and responsibilities, employee competence evaluations and training days. Regarding equal employment opportunities, we investigate the number of people belonging to disclosed minority groups, for example, by career level, country and compensation.

Univariate results of the content analysis

Table 4 shows the descriptive statistics of the characteristics of the sample firms. The companies with voluntarily disclosed CEs and CSR reports are, on average, profitable (mean return on assets of 5.7%; only 14.7% of the sample has negative earnings), financially stable (mean leverage of 22.9%), slowly growing (mean sales growth of 2.5%) and of a similar size (low standard deviation and mean similar to median).

Table 5 shows the univariate descriptive statistics of the content analysis of the CEs and CSR reports and Table 6 shows their frequency distribution based on a Likert scale. The levels of disclosure regarding employee health and safety in the CSR reports are heterogeneous; in the sample, all the levels from 1 to 4 (minimum and maximum) are represented. Measurable results are not always included in these voluntary CSR disclosures. On the other hand, in the CEs, the disclosure levels are greater than Level 1. The keywords health and safety are never reported individually (0 observations in Level 1 and 73 observations in Level 2), and the environment is often (50 observations) considered (Level 3). However, the average disclosure level score is higher in the CSR reports (3.682) than it is in the CEs (2.473) because Level 4 disclosures (97 observations) are more common in the CSR reports. In the CSR reports, the disclosures in this category are often very detailed, including measurable results, comparisons and other details.

The category of learning and development opportunities is the only category including Level 0 disclosures (minimum). In the voluntary CE and CSR reports, employee health and safety and employment opportunities are always included, while learning and development opportunities may not be considered. The maximum and the mean values of the disclosure level of this category are higher in the CSR reports (Level 4) than in the CEs (Level 3). The CSR_ Learning and development opportunities variable exhibits the highest standard deviation. The voluntary disclosures corresponding to this category are highly differentiated among the listed nonfinancial firms. Regarding CE_Learning and development opportunities, Level 1 disclosures are the most common with a single keyword related to continuous education/training without policies related to potential development or professional growth.

The disclosures on learning and development opportunities contrast with the disclosures on employee health and safety. There is more variation in these disclosures in the CEs (minimum 1 and maximum 4) than in the CSR reports (minimum 2 and maximum 4). A measurable result is always included in the voluntary CSR disclosures. However, detailed Level 4 disclosures are not common in the CSR reports (only 1 observation). Regarding CE_Equal employment opportunities, the highest frequency corresponds to Level 2 and the disclosed keywords are related to diversity in general and diversity in reference to disabled people. Policies related to other groups based on ethnicities, races, religions, origins, ideologies, beliefs and gender are less common.

Table 7 shows a correlation matrix for this analysis. The low correlation among the control variables and the CSR variables shows the absence of multicollinearity problems. An interesting univariate correlation between the size and type of the CSR reports is only present among the CE disclosures related to employee health and safety. The other disclosures are not significantly correlated to firm size or other firm characteristics.

Multivariate results of the regression model

Table 8 shows the results of the regressions. Regarding the control variables, the univariate correlation between size and type of CSR report is confirmed in the multivariate regression; this is the case for the employee health and safety category in relation to size and for all categories in relation to type of report. Moreover, leverage is related to CE_Employee health and safety and CE_Learning and development opportunities, and profitability is related to CE_Equal employment opportunities.

The results related to the hypothesis show that the examined CE policies on health and safety are negatively and significantly related to the CSR disclosures on the number of employee injuries in a firm and the related procedures (marginal effect −0.596; p -value 0.052). The CE policies on training and career opportunities are negatively and significantly related to the CSR disclosures on the number of training hours and career evaluations in a firm and the related procedures (marginal effect −0.385; p -value 0.092). The CE policies on equal opportunities are not significantly related to the CSR disclosures on equal opportunities and the related procedures and metrics (marginal effect 0.025; p -value 0.892). The negative sign of this relation can be interpreted as an indicator that if companies have better policies in their CEs about health and safety and learning and development opportunities, there is little need to provide additional disclosures in their voluntary CSR documents about specific strategic initiatives. Of the several theories that can be used to approach this issue, ethical firm system theory can be used to analyze our results ( Rusconi, 2019 ). Stakeholder theory is encompassed in an ethical vision of firm theory that considers the ethical duties defined in CE documents strictly linked to the management of companies as a whole.

We contribute to the few studies that analyze BE and CSR from an employee perspective ( O’Dwyer and Madden, 2006 ). For example, Snell et al. (2010) find that clear ethical rules can simplify discussions and facilitate interactive justice among employees. We add to this that clear ethical rules on health and safety and on learning and development opportunities simplify the work related to this issue and do not require additional initiatives on the subject to achieve the ethical vision of the firm.

Of the three possible interpretations of the relationship between CSR and BE given by Weller (2020) , we provide evidence supporting the proposal that CSR and BE are distinct but related. They have different purposes, have mutual influences and are important to each other ( Schwartz and Carroll, 2008 ).

Measuring CSR with specific procedures and metrics (regarding employee injuries, training hours and career evaluations and people in minority groups), we view CSR as a concept whereby companies can integrate social and environmental concerns into their business operations and establish a continuing commitment to behave ethically. Our focus is on actual operations performed. Measuring BE based on policies in the examined companies’ codes, we view BE as rules, standards, codes, principles and guidelines ( Harrison et al. , 2019 ; Lewis, 1985 ). Finding a negative relation between these two concepts, we support the interpretation that CSR and BE are distinct concepts.

Theoretical implications

The existing literature on CSR and BE presents opportunities for further study, as these concepts are often analyzed imprecisely or without effective considerations of their mutual influences. Several authors ( Harrison et al. , 2019 ) have pointed out that there is ambiguity in the current definitions of CSR and BE, and these concepts are often measured and analyzed as a single element. To eliminate or help to reduce this ambiguity, we consider the existing relationships between BE (CE) policies and CSR initiatives, focusing, in particular, on a key company stakeholder: employees. In this respect, this study extends the theoretical contributions of the previous research on CSR and BE.

Our findings provide evidence showing that CSR and BE should be viewed as distinct but mutually related concepts. In particular, the data show that CE policies on health and safety are negatively and significantly related to CSR disclosures on the number of employee injuries in a firm and related procedures; CE policies on training and career opportunities are negatively and significantly related to CSR disclosures on the number of training hours and career evaluations conducted in a firm and related procedures; and CE policies on equal opportunities are not significantly related to CSR disclosures on equal opportunities or related assessments and procedures. In this respect, it is possible to suppose that if there are precise policies that are properly formalized and described in a company’s CE on health and safety, training and career opportunities, there will be fewer initiatives reported in that company’s CSR report; however, there is a greater need to undertake such initiatives and report them in a CSR report if they are not included in a CEs.

The conclusions of our work, although referring to a specific stakeholder, suggest the need to consider the two instruments in a synergic perspective and, in particular, to carefully consider what to describe in each one, considering the implications that there will be in the reporting of the other. Surely, this requires reflection on the consistency of BE statements and CSR actions that can be more effectively verified in the presence of both instruments.

This is even more significant considering the synergy that should exist between the bodies dealing with BE and CSR, that certainly need to find spaces for comparison and alignment. Such investigations may represent an interesting space for further research developments.

Managerial implications

From a managerial perspective, companies are spending increasing amounts of resources to develop CSR initiatives and to properly consider and incorporate BE in their corporate strategies and corporate governance.

The results of this research reveal that the two examined concepts, being independent, require precise and individualized observations; however, since they are connected, they must also be considered in terms of their mutual interdependence. Since the methods used for developing CE documents and CSR initiatives are independent but connected, companies must consider BE and CSR strategies separately, but they must take into account also their mutual influences. For this reason, the choice to limit or standardize CE practices toward employees may induce the need to establish additional related CSR initiatives to provide legitimate stakeholder satisfaction.

These results can be used by managers to better understand which areas of CSR and BE to invest in and the possible consequences of these investment choices. In this sense, behavior that is perceived to be unethical (e.g. a missing or ineffective CE) can undermine the value of a company, and engagement in CSR initiatives can help companies develop a positive reputation that leads to subsequent business returns.

From an organizational perspective, the research findings can also help companies in setting up and establishing appropriate CSR and BE bodies or procedures to take care of their communication aspects.

This research provides an assessment tool for monitoring CSR and BE principles and can be adapted to many contexts of company activity. Understanding the examined concepts independently of each other will help companies assess their current positions and improve over time.

Limitations and future research

This research has several limitations and insights for future studies. First, this analysis considers specific CSR and BE variables related to employees, selected according to the specific features of the Italian regulatory and business context. The existing literature ( Spiller, 2000 ) identifies other aspects that can be explored, paving the way for further investigations of CSR and BE variables. This direction of further investigation could, moreover, benefit from a broadening of the sample of companies examined, for example, by taking into consideration more countries or more variables, such as cultural differences or different regulations.

A second aspect concerns regulatory interventions on CSR of the past years that could influence companies’ choices in this area. Further studies in the coming years, especially regarding the main actions or directions of change adopted by companies, could also be interesting for assessing the effectiveness of regulatory interventions.

Furthermore, we are aware that we are analyzing CEs and CSR reports and not real ethical practices regarding employees; although we think that the content of these documents can provide an interesting analysis and give information about the employee policies that companies voluntarily define and disclose, further investigation, e.g. through questionnaires or interviews, could deepen this analysis.

Finally, an interesting area for further research developments may be the analysis of the bodies and procedures existing in companies and dedicated to BE and CSR. Because of the close associations highlighted, in fact, the composition and functioning of the bodies dedicated to these issues should also ensure spaces for coherence and collaboration, opening research directions in the field of corporate governance and organizational studies as well.

Sample selection

Sample distribution by year and by type of report

Sample distribution by industry

Descriptive statistics: firm characteristics

Frequency distribution based on the Likert scale

Correlation matrix

Regression results

Sample scoring criteria for CE

Sample scoring criteria for CSR

Ahmad , Z. , Ali , G. , Mirza , H.H. , Yousaf , U. , Ahmer , Z. and Usman , B. ( 2019 ), “ Employees' response to code of ethics and corporate philanthropic social responsibility: evidence from Pakistan ”, Journal of the Research Society of Pakistan , Vol. 56 No. 2 , pp. 149 - 162 .

Allen , A.M. and Peloza , J. ( 2015 ), “ Someone to watch over me: the integration of privacy and corporate social responsibility ”, Business Horizons , Vol. 58 No. 6 , pp. 635 - 642 .

Balluchi , F. and Furlotti , K. ( 2013 ), CSR Disclosure by Italian Companies. An Empirical Analysis , LAP Lambert Academic Publishing , Saarbrucken, Deutschland .

Camodeca , R. and Almici , A. ( 2017 ), “ Implementing integrated reporting: case studies from the Italian listed companies ”, Accounting and Finance Research , Vol. 6 No. 2 , pp. 121 - 135 .

Campopiano , G. and De Massis , A. ( 2015 ), “ Corporate social responsibility reporting: a content analysis in family and non-family firms ”, Journal of Business Ethics , Vol. 129 No. 3 , pp. 511 - 534 .

Carroll , A.B. ( 1991 ), “ The pyramid of corporate social responsibility: toward the moral management of organizational stakeholders ”, Business Horizons , Vol. 34 No. 4 , pp. 39 - 48 .

Chantziaras , A. , Dedoulis , E. , Grougiou , V. and Leventis , S. ( 2021 ), “ The impact of labor unionization on CSR reporting, sustainability accounting ”, Management and Policy Journal , Vol. 12 No. 2 , pp. 437 - 466 .

Choi , B. and La , S. ( 2013 ), “ The impact of corporate social responsibility (CSR) and customer trust on the restoration of loyalty after service failure and recovery ”, Journal of Services Marketing , Vol. 27 No. 3 , pp. 223 - 233 .

Crane , A. , Matten , D. and Moon , J. ( 2010 ), “ The emergence of corporate citizenship: historical development and alternative perspectives ”, in Scherer , A.G. and Palazzo , G. (Eds), Corporate Citizenship in Deutschland , Edward Elgar , Cheltenham , pp. 64 - 91 .

Davidson , P. and Griffin , R. ( 2000 ), Management: Australia in a Global Context , Wiley , Brisbane .

Davis , K. ( 1975 ), “ Five propositions for social responsibility ”, Business Horizons , Vol. 18 No. 3 , pp. 19 - 24 .

De Bakker , F.G.A. , Groenewegen , P. and Den Hond , F. ( 2005 ), “ A bibliometric analysis of 30 years of research and theory on corporate social responsibility and corporate social performance ”, Business & Society , Vol. 44 No. 3 , pp. 283 - 317 .

De George , R.T. ( 1987 ), “ The status of business ethics: past and future ”, Journal of Business Ethics , Vol. 6 No. 3 , pp. 201 - 211 .

Den Uyl , D. ( 1984 ), The New Crusaders: The Corporate Social Responsibility Debate , Social Philosophy and Policy Center , Bowling Green, OH .

Donaldson , T. ( 1982 ), Corporations and Morality , Prentice Hall , Englewood Cliffs, NJ .

Epstein , E.M. ( 1987 ), “ The corporate social policy process: beyond business ethics, corporate social responsibility, and corporate social responsiveness ”, California Management Review , Vol. 29 No. 3 , pp. 99 - 114 .

Fassin , Y. , Van Rossem , A. and Buelens , M. ( 2011 ), “ Small-business owner-managers’ perceptions of business ethics and CSR-related concepts ”, Journal of Business Ethics , Vol. 98 No. 3 , pp. 425 - 453 .

Fatma , M. , Khan , I. and Rahman , Z. ( 2018 ), “ Striving for legitimacy through CSR: an exploration of employees responses in controversial industry sector ”, Social Responsibility Journal , Vol. 15 No. 7 , pp. 924 - 938 .

Ferrell , O.C. ( 2004 ), “ Business ethics and customer stakeholders ”, Academy of Management Perspectives , Vol. 18 No. 2 , pp. 126 - 129 .

Fischer , J. ( 2004 ), “ Social responsibility and ethics: clarifying the concepts ”, Journal of Business Ethics , Vol. 52 No. 4 , pp. 381 - 390 .

Freeman , R.E. ( 1984 ), Strategic Management: A Stakeholder Approach , Prentice Hall , Englewood Cliffs, NJ .

Freeman , R. , Harrison , J. , Wicks , A. , Parmar , B. and De Colle , S. ( 2010 ), Stakeholder Theory: The State of the Art , Cambridge University Press , Cambridge .

Goodpaster , K.E. ( 1991 ), “ Business ethics and stakeholder analysis ”, Business Ethics Quarterly , Vol. 1 No. 1 , pp. 53 - 73 .

Goodpaster , K.E. and Matthews , J.B. ( 1982 ), “ Can a corporation have a conscience ”, Harvard Business Review , Vol. 60 No. 1 , pp. 132 - 141 .

Gössling , T. and Vocht , C. ( 2007 ), “ Social role conceptions and CSR policy success ”, Journal of Business Ethics , Vol. 74 No. 4 , pp. 363 - 372 .

Hansen , S.D. , Dunford , B.B. , Boss , A.D. , Boss , R.W. and Angermeier , I. ( 2011 ), “ Corporate social responsibility and the benefits of employee trust: a cross-disciplinary perspective ”, Journal of Business Ethics , Vol. 102 No. 1 , pp. 29 - 45 .

Harrison , D.E. , Ferrell , O.C. , Ferrell , L. and Hair , J.J.F. ( 2019 ), “ Corporate social responsibility and business ethics: conceptualization, scale development and validation ”, Journal of Product & Brand Management , Vol. 29 No. 4 , pp. 431 - 439 .

Hoffman , W.M. and Fisher , J.V. ( 1990 ), “ Corporate responsibility: property and liability ”, in Hoffman , W.M. and Moore , J.M. (Eds), Business Ethics: Readings and Cases in Corporate Morality , McGraw-Hill , New York, NY , pp. 176 - 182 .

Houghton , S.M. , Gabel , J.T.A. and Williams , D.W. ( 2009 ), “ Connecting the two faces of CSR: does employee volunteerism improve compliance? ”, Journal of Business Ethics , Vol. 87 No. 4 , pp. 477 - 494 .

Joyner , B.E. and Payne , D. ( 2002 ), “ Evolution and implementation: a study of values, business ethics and corporate social responsibility ”, Journal of Business Ethics , Vol. 41 No. 4 , pp. 297 - 311 .

Klonoski , R.J. ( 1986 ), “ The moral responsibilities of stockholders ”, Journal of Business Ethics , Vol. 5 No. 5 , pp. 385 - 390 .

Lewis , P.V. ( 1985 ), “ Defining ‘business ethics’: like nailing jello to a wall ”, Journal of Business Ethics , Vol. 4 No. 5 , pp. 377 - 383 .

Liao , P.-C. , Shih , Y.N. , Wu , C.L. , Zhang , X.L. and Wang , Y. ( 2018 ), “ Does corporate social performance pay back quickly? A longitudinal content analysis on international contractors ”, Journal of Cleaner Production , Vol. 170 , pp. 1328 - 1337 .

Manley , W. ( 1991 ), Executives Handbook of Model Business Conduct Codes , Prentice-Hall , New York, NY .

Mason , C. and Simmons , J. ( 2013 ), “ Giving as good as they get? Organization and employee expectations of ethical business practice ”, Business and Society Review , Vol. 118 No. 1 , pp. 47 - 70 .

Mazza , T. and Furlotti , K. ( 2020 ), “ Quality of code of ethics: an empirical analysis on the stakeholder employee ”, Social Responsibility Journal , Vol. 16 No. 8 , pp. 1377 - 1402 .

O’Dwyer , B. and Madden , G. ( 2006 ), “ Ethical codes of conduct in Irish companies: a survey of code content and enforcement procedures ”, Journal of Business Ethics , Vol. 63 No. 3 , pp. 217 - 236 .

Paolucci , G. and Cerioni , E. ( 2017 ), “ Integrated reporting and Italian companies: an empirical investigation ”, International Journal of Business and Management , Vol. 12 No. 9 , pp. 221 - 230 .

Pava , M.L. ( 1996 ), “ The Talmudic concept of? Beyond the letter of the law?: Relevance to business social responsibilities ”, Journal of Business Ethics , Vol. 15 No. 9 , pp. 941 - 950 .

Pedersen , E.R.G. ( 2011 ), “ All animals are equal, but …: management perceptions of stakeholder relationships and societal responsibilities in multinational corporations ”, Business Ethics: A European Review , Vol. 20 No. 2 , pp. 177 - 191 .

Pereira , R. , Bhat , V. and Hans , V.B. ( 2020 ), “ Business ethics and corporate social responsibility reciprocity – a study of selected companies ”, SSRN Electronic Journal .

Preston , L.E. and Post , J.E. ( 1975 ), Private Management and Public Policy: The Principle of Public Responsibility , Prentice Hall , Englewood Cliffs, NJ .

Romi , A. , Cook , K.A. and Dixon-Fowler , H.R. ( 2018 ), “ The influence of social responsibility on employee productivity and sales growth: evidence from certified B corps ”, Sustainability Accounting, Management and Policy Journal , Vol. 9 No. 4 , pp. 392 - 421 .

Rusconi , G. ( 2019 ), “ Ethical firm system and stakeholder management theories: a possible convergence ”, European Management Review , Vol. 16 No. 1 , pp. 147 - 166 .

Schmidheiny , S. , Chase , R. and Desimone , L. ( 1997 ), Signals of Change: Business Progress towards Sustain , WBCSD Publications , Geneva .

Schwartz , M.S. and Carroll , A.B. ( 2008 ), “ Integrating and unifying competing and complementary frameworks: the search for a common core in the business and society field ”, Business & Society , Vol. 47 No. 2 , pp. 148 - 186 .

Scott , W.R. ( 1995 ), Institutions and Organizations , Sage , Thousand Oaks, CA .

Sethi , S.P. , Martell , T.F. and Demir , M. ( 2017 ), “ An evaluation of the quality of corporate social responsibility reports by some of the world’s largest financial institutions ”, Journal of Business Ethics , Vol. 140 No. 4 , pp. 787 - 805 .

Simmons , J. ( 2008 ), “ Ethics and morality in human resource management ”, Social Responsibility Journal , Vol. 4 Nos 1/2 , pp. 8 - 23 .

Snell , R.S. , Tjosvold , D. and Lanjun Wu , J. ( 2010 ), “ Clarity of ethical rules for open-minded discussion to resolve ethical issues in Chinese organizations ”, Asia Pacific Journal of Human Resources , Vol. 48 No. 2 , pp. 185 - 211 .

Spiller , R. ( 2000 ), “ Ethical business and investment: a model for business and society ”, Journal of Business Ethics , Vol. 27 Nos 1/2 , pp. 149 - 160 .

Verbeke , A. and Tung , V. ( 2013 ), “ The future of stakeholder management theory: a temporal perspective ”, Journal of Business Ethics , Vol. 112 No. 3 , pp. 529 - 543 .

Weaver , G.R. ( 1993 ), “ Corporate codes of ethics: purpose, process and content issues ”, Business & Society , Vol. 32 No. 1 , pp. 44 - 58 .

Weller , A. ( 2020 ), “ Exploring practitioners’ meaning of ‘ethics’, ‘compliance’, and ‘corporate social responsibility’ practices: a communities of practice perspective ”, Business & Society , Vol. 59 No. 3 , pp. 518 - 544 .

Williams , O.F. and Murphy , P.E. ( 1990 ), “ The ethics of virtue: a moral theory for marketing ”, Journal of Macromarketing , Vol. 10 No. 1 , pp. 19 - 29 .

Corresponding author

About the authors.

Katia Furlotti is based at the Department of Economics and Management, University of Parma, Parma, Italy. She, Associate Professor in Business Economics at the University of Parma. She has been visiting professor at Greenwich University (London). Her research interests include: corporate social responsibility and accountability, business ethics, corporate governance and accounting history. She is a member of several European Associations (EAA, EBEN, CSEAR) and Italian Academy (AIDEA, SISR, SIDREA). She is the author of publications and reviewer of several scientific journals.

Tatiana Mazza is based at the Department of Economics and Management, University of Parma, Parma, Italy. She, Associate Professor in Business Economics at the University of Parma. She has been visiting PhD at Louisiana State University (USA). Her research interests include several topics of auditing and accounting (audit rotation, enforcement, internal audit, internal control, earnings management, corporate governance and voluntary disclosure). She is a member of American and European Associations (EAA, AAA) and Italian Academy (AIDEA, SIDREA). She is the author of publications and reviewer of several scientific journals.

Related articles

We’re listening — tell us what you think, something didn’t work….

Report bugs here

All feedback is valuable

Please share your general feedback

Join us on our journey

Platform update page.

Visit emeraldpublishing.com/platformupdate to discover the latest news and updates

Questions & More Information

Answers to the most commonly asked questions here

• Original Article
• Open access
• Published: 29 October 2021

Corporate social responsibility in international business literature: results from text data mining of the Journal of International Business Studies

• Karen Paul 1 &
• Carlos M. Parra   ORCID: orcid.org/0000-0001-6029-4512 1  

International Journal of Corporate Social Responsibility volume  6 , Article number:  12 ( 2021 ) Cite this article

11k Accesses

2 Citations

Metrics details

Corporate social responsibility has been an important theme in management at least since the 1960s. International business became a recognized subfield in management around the same time. Logically, there might have been much dialogue about corporate social responsibility in international business research and publication, yet previous reviews of the literature indicate relatively little such research. This study complements previous literature reviews by employing text data mining to analyze a sample of 1188 articles published from 2000 to 2018 in the Journal of International Business Studies ( JIBS ). Results show that from 2000 to 2018 only 35 CSR focused articles appeared. CSR research has increased over time, highly influenced by editorial specification of special issues. These documents can be grouped into seven CSR topics, with corruption and embeddedness being the most salient. Strategies are suggested for increasing research on CSR in international business.

Introduction

The purpose of this research is to assess the inclusion of corporate social responsibility (CSR) or social responsibility (SR) in articles published from 2000 to 2018 in the Journal of International Business Studies (JIBS). JIBS is the official publication of the Academy of International Business (AIB) has ISSN: 0047-2506 (print) and 1478-6990 (electronic). Secondarily, this study assesses whether CSR focused articles have increased over time, and the geographic bases of authors represented by articles having at least 10% CSR topic weight. Many definitions of CSR and ways of measuring it have been proposed. The definition used to provide a framework in this study is the one put forth by the International Standards Organization (ISO) in ISO 26000. Moratis ( 2016 : 41) summarizes the dimensions included in this standard as the following: Environment, Social, Stakeholder, Societal obligation, Quality of life; Ethical conduct; Law abiding, Human rights, Transparency. The ISO uses Social Responsibility (SR) as its referent term. Following Moratis ( 2016 ), the term CSR is used in this study, because it is historically the term often used, and from a research methodology viewpoint the term CSR subsumes SR. Thus, this study’s methodology identifies documents in using either SR or CSR in their text.

Most previous literature reviews have asserted a neglect of CSR in the international business literature (Bhattacharyya, 2020 ; Doh et al., 2010 ; Kolk, 2016 ; Egri & Ralston, 2008 ; Pisani et al., 2017 ). Defining international business and enumerating all its representative scholarly outlets is beyond the scope of this analysis, but those articles appearing in the Journal of International Business Studies ( JIBS ) are deemed to be a logical representation of the field’s interests. However, this is not to suggest that there are no other meritorious journals in international business exist. Indeed, many other journals are also representative of the field, but JIBS is the first journal sponsored by the Academy of International Business and the only specifically international business journal listed in the Financial Times Index, widely used by universities as an indication of high-quality academic work (Saunders et al., 2011 ), and is widely recognized as the leading journal in international business (Tüselmann et al., 2016 ).

Looking at a broad range of journals in international business and related fields going back to 1985, Pisani et al. ( 2017 : 591) conclude, “CSR research is far from being global and still emerging in ‘mainstream’ IB.” On the other hand, Buckley et al. ( 2017 ), present topics related to CSR as important for the field of international business, indeed, as one of the “grand challenges” for maintaining relevance and developing the field in the future. This review seeks to answer the question of whether CSR has been a significant research topic in the international business literature, or whether it is a relatively neglected area. This review differs from others in several ways. First, previous reviews have generally used a more qualitative methodology, identifying themes and concepts the researchers considered to be associated with CSR. For example, in the case of Pisani et al. ( 2017 ), topics include items that might be associated with CSR, but also might have little to do with CSR, e.g., expatriate management. The study reported here uses a more quantitative methodology, one that allows terms and topics to emerge from textual analysis itself rather than to be derived from existing concepts and paradigms. The advantage of using this approach is that it facilitates a relatively objective analysis compared to content analysis or keyword analysis since it enables results to be obtained somewhat free from pre-existing, subjective paradigms. This technique has been used in analyzing the content of other academic journals (Guan et al., 2019 ; Kulkarni et al., 2014 ) as well as corporate reports (Parra et al., 2017 ).

However, text data mining analysis is subject to bias of its own. For example, the frequency of the word “environment” might suggest high interest in sustainability and other topics related to “green” issues. In the case of JIBS , this term generally applied to the business environment, e.g., competition, government regulation, etc.

Another contrast is that this study focuses on only one journal. Focusing on one leading journal allows us to see whether CSR has been represented at the center of the field of international business scholarship. An argument could be made that this focus is too exclusive, that an analysis should be as broad and deep as possible. However, many different topics can be identified in a wide and deep analysis including many meritorious journals, and filtering occurs insofar as certain topics attract leading researchers and become central to a field, which would naturally be the topics studied in its leading journal. Inclusion of a wide range of journals could amplify the noise surrounding any important topic of central interest to researchers, and might obscure the apparent coverage of topics like CSR which may or may not have attracted top researchers’ attention.

Another aspect of this study distinguishes it from others. Previous studies have gone back many decades in their analyses. One could argue that certain classic articles will provide a foundation for thought on CSR for decades to come, e.g., Friedman, 1970 , Carroll, 1991 . However, any scholarly field that survives evolves and develops with new scholarship, especially a field where data sources have expanded as rapidly as is the case with CSR. Inclusion of early time periods may be interesting from a sociology of knowledge perspective (Kot, 2014 ), but may dilute the significance of the CSR topic in the international business literature of most interest to scholars during recent decades. Thus, this study is restricted to 2000-2018.The structure of this paper starts with a review of international business literature reviews which focus on the inclusion of SR and CSR. Next comes a description of the methodology (text data mining-latent semantic analysis, or TDM-LSA) along with a discussion of the more technical details of this approach. Then results are presented. The final section of the paper presents limitations of the study along with implications of the findings for the inclusion of CSR in international business research, along with strategies and resources that may be useful for bringing CSR more into the scholarship of international business.

Literature review on the inclusion of CSR as topic in international business

Several recent reviews have indicated little attention being paid to CSR in international business (Doh et al., 2010 ; Kolk, 2016 ; Egri & Ralston, 2008 ; Pisani et al., 2017 ). Inkpen and Beamish ( 1994 ) conducted an analysis of the first 25 years of research published in JIBS, and categorized the corpus into 24 subdisciplines, none containing the words “social responsibility” or CSR. The most relevant term they identified was business-government interaction, finding it the 11th most frequent of 24 categorizations. A total of 53 articles were identified in this business-government interaction category, out of a total of 1220 articles in all categories. Buckley ( 2002 ) did a comprehensive analysis of the grand questions of the international business field in its formative years as a discipline, and no topic relating to CSR appears in the existing list or in the recommended topics for future research. Griffith et al. ( 2008 ) examined scholarly work in six leading international business journals from 1996 to 2006. They identified multinational enterprise (MNE) citizenship, ethical issues in international business, public policy issues, and environmental issues as emerging themes, however, these themes together constituted only about 10% of the total emerging themes. Kolk and Van Tulder, looking at CSR and sustainable development in the international business literature, observed:

“Sustainable development and CSR have only slowly been taken up as relevant concepts of study in mainstream management journals in general, and in International Business publications in particular…it is still remarkable that, except for specialized journals on business ethics and business and society where CSR has received most attention, more than 97% of the articles in main management journals over the past two decades have not referred to either CSR or sustainable development at all” (Kolk & Van Tulder, 2010 : 120).

Kolk examined the international business literature inclusion of social responsibility issues over a 50-year period, identifying three subthemes: “the (green) environment; ethics, rights and responsibilities; poverty and (sustainable) development” (Kolk, 2016 : 23). However, the three themes were not highly represented in the literature examined. Buckley, Doh, and Benische identified as a “grand challenge” the topic of “understanding how MNEs respond to greater pressures for social responsibility and sustainability in the global operations” (Buckley et al., 2017 : 1046).

It is interesting to compare the field of international business with international marketing, because a contrast can be seen. For example, Eteokleous et al. ( 2016 ), using LSA methods like those used here, found considerable attention paid to CSR themes in the international marketing literature, and Fatma and Rahman ( 2015 ) identified several CSR themes in the literature on consumers. It is also interesting to consider CSR coverage in business ethics specific journals, where many international topics have been studied, but with different and distinct theoretical approaches from international business. Some studies in business ethics or business and society journals compare CSR attitudes or practices in different countries, e.g., Chen and Bouvain ( 2009 ). Others look at international codes such as the U.S. Global Compact (Sethi & Schepers, 2014 ), or international monitoring such as that done by Transparency International (Wang & Rosenau, 2001 ). Sustainability has emerged as a unifying theme (Chabowski et al., 2011 ). Clearly, there has been considerable interest in CSR in areas related to international business.

Methodology

Text Data Mining (TDM) is built on the basic notion of the word count. Latent Semantic Analysis (LSA) is a mathematical method for inductively identifying themes based on word frequencies and word associations within articles in a whole corpus (all articles in the journal for the time selected). First, all words in all articles (often termed “documents”) are downloaded. Then words are excluded that have no special significance e.g., “the”, “thus.” Words appearing infrequently are also excluded, and terms containing a common stem are combined. The result is a matrix of words of interest with their frequency of appearance. Through filtering, terms are weighted by normalizing frequencies. This allows an assessment to be made of the relative importance of each term in relation to other terms and to identify connections between terms. For example, if the term “CSR” appears often, but mostly in connection with “human rights”, this connection will be shown.

Weights are assigned to identify associations between terms (i.e., topics) or between documents. LSA is used to obtain Singular Vector Decompositions (SVDs) from the resulting matrix composed of documents and their associated weighted terms. The SVDs show the importance of terms in each document (Manning et al., 2008 ). These SVDs can then be rotated to model the behavior of the data and to facilitate interpretation as well as labeling (Evangelopoulos & Visinescu, 2012 ; Evangelopoulos et al., 2012 ). Finally, post-LSA analysis may include comparing and classifying documents using either cosine similarity, or by using hierarchical or non-hierarchical clustering methods. Evangelopoulos et al. ( 2012 ) make some recommendations on LSA extensions and argue that researchers should use non-hierarchical clustering techniques such as K-means (Hartigan & Wong, 1979 ; Jain, 2010 ) or the expectation-maximization algorithm (Do & Batzoglou, 2008 ) for document summarization. However, for purposes of obtaining mutually exclusive groupings, when the number of groupings is not known, hierarchical clustering is preferred (Wang et al., 2009 ). To summarize, the frequency of terms, and the relationship (or clustering) of terms into topics emerges from the data, rather than from assignment to categories determined by human coding.

Figure  1 illustrates this methodology. The first step is Unsupervised Topic Discovery (UTD), which entails focusing on SVDs that include the term eigenvectors, placing special attention on factor loadings obtained from transposing matrices for terms, which represent term clusters/groupings (or topics). However, a single document may have high factor loadings in more than one SVD. In other words, one document may allude to more than one topic. Indeed, any scholarly article will probably contain several topics. The next question is how important this topic is for defining a document as a whole, and what other topics are alluded to in the document. Consequently, documents that discuss CSR topics are selected by calculating the total sum of the factor loadings per document (or total document weight) as well as the relative contribution made to that total by the CSR SVD. This is the second step shown in Fig.  1 . The third step is to then rank all documents in the collection and obtain a sub-collection of CSR documents including each article for which the CSR SVD contributed at least 10% to total document weight. Using a 10% cutoff conformed to standards within the acceptable range of other studies using LSA, as well as to results obtained in previous reviews of CSR treatment in international business literature (Inkpen & Beamish, 1994 ). The fourth step is to take this sub-collection and apply UTD once again to obtain CSR topics, and to identify CSR sub-categories. These steps are illustrated in Fig. 1 .

Methodological Approach to Obtain CSR Taxonomy from 2000 to 2018

The final step, illustrated in Fig.  2 , is to apply divisive hierarchical clustering to obtain a taxonomy of CSR topics treated from 2000 to 2018 (Wang et al., 2009 ). This taxonomical representation reveals connections between topics included the analysis. For example, corruption and embeddedness (or institutional logic) are split out into a branch that represents a separate cluster, while all other topics are remain in a different branch .

Topic Clusters in Articles Containing at Least 10% CSR Content

The application of TDM analysis on the 1188 JIBS articles (dating from 2000 to 2018) yields a total of 35 SVDs or topics. Table  1 provides a list of representative words for all topics. CSR appears as Topic 18. This listing is not a ranking, but rather an enumeration of topics appearing in JIBS, which are comprised of term clusters. The summary term may be viewed as a term of convenience and carries no special significance other than to enable communication that differentiates between themes typically treated in JIBS. By focusing on what the analysis has labeled Topic 18 one can see which articles have fallen within this category, what sub-themes have appeared (again identified by term clusters within Topic 18). Table 1 is a list of topics identified by TDM.

The next step is to identify the articles in the collection of 35 articles in the CSR topic cluster (Topic 18) that have at least a 10% weight on CSR SVD, to eliminate items such as book reviews and cases where, for example, the term “environment” refers to the general business environment rather than to some environmental issue. Also, two relevant articles that came corrupted from the publisher were manually included. Finally, the resulting articles are analyzed according to the article’s CSR SVD contribution using 10% as the basis for inclusion of the article in the sub-collection on which divisive hierarchical clustering is used. Table  2 provides a listing of the JIBS articles identified, arranged by subject, showing authors with the geographic location of their universities.

The next consideration is the frequency of CSR related materials over time. Figure  3 provides time series data. Two tendencies merit notice. First, there is an increasing incidence of CSR related topics over time. This is consistent with the more general analysis provided by Pisani et al. ( 2017 ).

Time Series of Articles with at Least 10% CSR Content

However, further examination shows that this incidence is heavily influenced by editorially determined special issues of JIBS. Note three CSR peaks in Fig. 3 . The 2006 peak corresponds to a special issue on corruption. The 2012 peak is associated with a special issue on cultural distance. Finally, in 2016 and 2017 there were special issues on internationalization in the information age and on international corporate governance.

Results show the proportion of CSR related articles appearing in JIBS is less than 5%, with robust statistical significance ( p  = .01). Editorial direction using special issues appears to have been a significant influence on the amount of CSR focused material appearing in JIBS. In particular, four of the nine articles in the legitimation category were published in the 2016 special issue on internationalization in information age. Furthermore, five of the six articles in the corruption category were published in the 2006 special issue on the topic. Foreignness and embeddedness each started as topics in 2012, coinciding with special issues on cultural distance and internationalization. The role of editorial direction and selection of appropriate topics for special issues has been critical for the inclusion of CSR material in this journal.

The geographical location of the CSR work that has appeared in JIBS during the period studied was also considered. Authors stating affiliations with universities from North America (the United States, Canada and Mexico) have contributed most CSR articles, with European authors contributing a substantial proportion, and a smaller proportion from Asia, mostly in co-authorships with North American or European authors. No authors publishing on CSR in JIBS during this period provided African, Middle Eastern, or South American university affiliations. This analysis indicates that JIBS has included relatively little CSR material during the period studied, 2000-2018. The articles which have featured CSR topics have tended to cluster around special issues where topics of specific CSR interest were solicited. This finding affirms previous studies but remains rather curious given that so many pressing CSR topics involve globalization, multinational companies, and governance issues of high international relevance.

Limitations and suggestions for further research

Although the journal used in this analysis is an obvious place to assess the significance of a topic in international business, many other journals could be considered. Perhaps CSR is a topic where interest develops at the margin of the field and flows from newcomers or outsiders to its central thought leaders, and from more marginal journals to the mainstream. Also, new topics may be in the pipeline, and even dissertations and conference presentations may include more CSR research than that which has passed through the entire review process and been published. However, the possibility that established academic networks and research teams may be resistant to new research topics and difficult for researchers interested in new topics to penetrate should be considered (Newburry & Gonzalez-Perez, 2015 ; Tilt, 2016 ). Another limitation is the use of TDM itself, a somewhat mechanical and arbitrary type of analysis that may miss critical, thoughtful, imaginative categorization or even subtleties of terminology.

The main question that arises from this study is why so little CSR material would be contained in the leading journal in international business. Prior to the period studied here, one might suspect that theory and data on CSR were not very well established, and this would limit publication of CSR research in a leading journal which would naturally require rigorous quantitative analysis as well as substantive theoretical contributions. However, CSR is now well established in the management literature with many data sources. Either a lack of familiarity with available data or a pragmatic calculation that CSR is not a career enhancing field of study for international business researchers might have influenced scholars not to focus on CSR.

Conclusions

A continuation of intentional efforts on the part of international business gatekeepers such as journal editors and accreditation organizations may be necessary if CSR topics are to gain more attention in international business. In addition, since quantitative studies dominate articles published in JIBS and other prestigious management journals, it might be helpful to promote awareness of the databases available on CSR topics. Since corruption is already an established area in international business research, the various indices on bribery and perceptions of corruption produced by Transparency International are highly relevant. Other publicly available data sources for international companies on a variety of CSR dimensions are available through the Global Reporting Initiative, a source which also collaborates with more than 150 other standards setting organizations in various areas of CSR. The International Standards Organization’s Standard 26,000 formed the basis for the definition of CSR that guided this study, and companies will be providing data structured around this standard (Zinenko et al., 2015 ), especially since it guides companies in compliance with the OECD Guidelines for Multinational Enterprises.

Whereas early articles on CSR had very little data to use for evaluating company CSR performance in connection with financial performance, the area has become more developed now, with many sources available, e.g., the MSCI KLD 400 Social Index, the MSCI USA ESG Select Index, the Calvert Index, and others that focus on aspects of CSR such as human rights and animal rights. The Global Impact Investor Network publishes an annual report including data from hundreds of socially screened funds. Many reviews of databases and indices may be found in the information technology and accounting literature, as well as the literature on socially responsible investing, now known as impact investing. Consequently, researchers in international business may find many relevant sources that have yet to be incorporated in international business research (Gkatziaki et al., 2018 ). Familiarity with these data may serve to expand the field of international business to include more CSR research.

Availability of data and materials

The dataset used and/or analyzed during this study are available from the corresponding author on reasonable request.

Abbreviations

• Corporate social responsibility

International Standards Organization

Journal of International Business Studies

Latent semantic analysis

MSCI KLD 400 Social Index is designed to provide exposure to companies with high MSCI ESG Ratings while excluding companies whose products may have negative social or environmental impacts

The MSCI USA ESG Universal Index is based on the MSCI USA Index, its parent index, and includes large and mid-cap securities of the U.S. equity markets

Organisation for Economic Co-operation and Development

• Social responsibility

Singular vector decompositions

• Text data mining

Unsupervised topic discovery

Bhattacharyya, S. S. (2020). Development of international corporate social responsibility framework and typology. Social Responsibility Journal , 16 (5), 719–744 http://dx.doi.org.ezproxy.fiu.edu/10.1108/SRJ-04-2018-0094 .

Article   Google Scholar  

Buckley, P. J. (2002). Is the international business research agenda running out of steam? Journal of International Business Studies , 33 (2), 365–373. https://doi.org/10.1057/palgrave.jibs.8491021 .

Buckley, P. J., Doh, J. P., & Benischke, M. H. (2017). Towards a renaissance in international business research? Big questions, grand challenges, and the future of IB scholarship. Journal of International Business Studies , 48 (9), 1045–1064. https://doi.org/10.1057/s41267-017-0102-z .

Carroll, A. B. (1991). The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders. Business Horizons , 34 (4), 39–48. https://doi.org/10.1016/0007-6813(91)90005-G .

Chabowski, B. R., Mena, J. A., & Gonzalez-Padron, T. L. (2011). The structure of sustainability research in marketing, 1958–2008: A basis for future research opportunities. Journal of the Academy of Marketing Science , 3 (1), 55–70. https://doi.org/10.1007/s11747-010-0212-7 .

Chen, S., & Bouvain, P. (2009). Is corporate responsibility converging? A comparison of corporate responsibility reporting in the USA, UK, Australia, and Germany. Journal of Business Ethics , 87 (1), 299–317. https://doi.org/10.1007/s10551-008-9794-0 .

Do, C. B., & Batzoglou, S. (2008). What is the expectation maximization algorithm? Nature Biotechnology , 26 (8), 897–899. https://doi.org/10.1038/nbt1406 .

Doh, J., Husted, B. W., Matten, D., & Santoro, M. (2010). Ahoy there! Toward greater congruence and synergy between international business and business ethics theory and research. Business Ethics Quarterly , 20 (3), 481–502. https://doi.org/10.1038/nbt1406 .

Egri, C. P., & Ralston, D. (2008). Corporate responsibility: A review of international management research from 1908 to 2007. Journal of International Management , 14 (4), 319–339. https://doi.org/10.1016/j.intman.2007.09.003 .

Eteokleous, P. P., Leonidou, L. C., & Katsikeas, C. S. (2016). Corporate social responsibility in international marketing: Review, assessment, and future research. International Marketing Review , 33 (4), 580–624. https://doi.org/10.1108/IMR-04-2014-0120 .

Evangelopoulos, N., & Visinescu, L. L. (2012). Text-mining the voice of the people. Communications of the ACM , 55 (2), 62–69. https://doi.org/10.1145/2076450.2076467 .

Evangelopoulos, N., Zhang, X., & Prybutok, V. R. (2012). Latent semantic analysis: Five methodological recommendations. European Journal of Information Systems , 21 (1), 70–86. https://doi.org/10.1057/ejis.2010.61 .

Fatma, M., & Rahman, Z. (2015). Consumer perspective on CSR literature review and future research agenda. Management Research Review , 38 (2), 195–216. https://doi.org/10.1108/MRR-09-2013-0223 .

Friedman, M. (1970). A Friedman doctrine: The social responsibility of business is to increase its profits. The New York Times Magazine , 13 (1970), 32–33.

Google Scholar  

Gkatziaki, V., Papadopoulos, S., Mills, R., Diplaris, S., Tsampoulatidis, I., & Kompatsiaris, I. (2018). easlE: Easy-to-use information extraction for constructing CSR databases from the web. ACM Transactions on Internet Technology , 45. https://doi.org/10.1145/3155807 .

Griffith, D. A., Cavusgil, S. T., & Xu, S. (2008). Emerging themes in international business research. Journal of International Business Studies , 39 (7), 1220–1235. https://doi.org/10.1057/palgrave.jibs.8400412 .

Guan, J., Manikas, A. S., & Boyd, L. H. (2019). The international journal of production research at 55: A content-driven review and analysis. Int J Prod Res , 57 (15-16), 4654–4666. https://doi.org/10.1080/00207543.2017.1296979 .

Hartigan, J. A., & Wong, M. A. (1979). Algorithm AS 136: A k-means clustering algorithm. Journal of the Royal Statistical Society. Series C (Applied Statistics) , 28 (1), 100–108. https://doi.org/10.2307/2346830 .

Inkpen, A. C., & Beamish, P. W. (1994). An analysis of twenty-five years of research in the Journal of International Business Studies. Journal of International Business Studies , 25 (4), 703–713. https://doi.org/10.1057/PALGRAVE.JIBS.8490220 .

Jain, A. K. (2010). Data clustering: 50 years beyond K-means. Pattern Recognition Letters , 31 (8), 651–666. https://doi.org/10.1016/j.patrec.2009.09.011 .

Kolk, A. (2016). The social responsibility of international business: From ethics and the environment to CSR and sustainable development. Journal of World Business , 51 (1), 23–34. https://doi.org/10.1016/j.jwb.2015.08.010 .

Kolk, A., & Van Tulder, R. (2010). International business, corporate social responsibility and sustainable development. International Business Review , 19 (2), 119–125. https://doi.org/10.1016/j.ibusrev.2009.12.003 .

Kot, S. (2014). Knowledge and understanding of corporate social responsibility. Journal of Advanced Research in Law and Economics , 5 (2), 217–223. https://doi.org/10.14505/jarle.v5.2(10).07 .

Kulkarni, S. S., Apte, U. M., & Evangelopoulos, N. E. (2014). The use of latent semantic analysis in operations management research. Decision Science , 45 (5), 971–994. https://doi.org/10.1111/deci.12095 .

Manning, C. D., Raghavan, P., & Schütze, H. (2008). Introduction to information retrieval . Cambridge University Press. https://doi.org/10.1017/S1351324909005129 .

Book   Google Scholar  

Moratis, L. (2016). Out of the ordinary? Appraising ISO 26000’s CSR definition. International Journal of Law and Management , 58 (1), 26–47. https://doi.org/10.1108/IJLMA-12-2014-0064 .

Newburry, W., & Gonzalez-Perez, M. A. (2015). International business in Latin America, and Latin Americans in international business: Insights from AIB-LAT. In W. Newburry, & M. A. Gonzalez-Perez (Eds.), International business in Latin America: Innovation, geography and internationalization , (pp. 1–46). Palgrave Macmillan. https://doi.org/10.1057/9781137409126_1 .

Chapter   Google Scholar  

Parra, C. M., Tremblay, M. C., Paul, K., & Castellanos, A. (2017). Exploratory content analysis using text data mining. The Journal of Corporate Citizenship , 2017 (16), 106–151. https://doi.org/10.9774/T&F.4700.2017.ju.00007 .

Pisani, N., Kourula, A., Kolk, A., & Meijer, R. (2017). How global is international CSR research? Insights and recommendations from a systematic review. Journal of World Business , 52 (5), 591–614. https://doi.org/10.1016/j.jwb.2017.05.003 .

Saunders, J., Wong, V., & Saunders, C. (2011). The research evaluation and globalization of business research. British Journal of Management , 22 (3), 401–419. https://doi.org/10.1111/j.1467-8551.2011.00755.x .

Sethi, S. P., & Schepers, D. H. (2014). United Nations global compact: The promise-performance gap. Journal of Business Ethics , 122 (3), 193–208. https://doi.org/10.1007/s10551-013-1629-y .

Tilt, C. A. (2016). Corporate social responsibility research: The importance of context. International Journal of Corporate Social Responsibility , 1 (1), 1–9. https://doi.org/10.1186/s40991-016-0003-7 .

Tüselmann, H., Sinkovics, R. R., & Pishchulov, G. (2016). Revisiting the standing of international business journals in the competitive landscape. Journal of World Business , 51 (4), 487–498. https://doi.org/10.1016/j.jwb.2016.01.006 .

Wang, H., & Rosenau, J. N. (2001). Transparency international and corruption as an issue of global governance. Global Governance , 7 (1), 25–49. https://doi.org/10.1163/19426720-00701005 .

Wang, J., Ma, L., Li, X., Zhou, Y., & Qiao, D. (2009). A new method of hierarchical text clustering based on lsa-hgsom. Mathematical Models and Methods in Applied Science , 3 (Sept.), 72. https://doi.org/10.5539/MAS.V3N9P72 .

Zinenko, A., Rovira, M. R., & Montiel, I. (2015). The fit of the social responsibility standards ISO 26000 within other CSR instruments: Redundant or complementary? Sustainability, Accounting, Management and Policy Journal , 6 (4), 498–526. https://doi.org/10.1108/SAMPJ-05-2014-0032 .

Download references

There are no sources of funding to report.

Author information

Authors and affiliations.

Florida International University, Miami, FL, 33199, USA

Karen Paul & Carlos M. Parra

You can also search for this author in PubMed   Google Scholar

Contributions

KP provided the theoretical and historical background. CP provided the data analysis and graphical representation. Both authors read and approve the work.

Authors’ information

Dr. Karen Paul is Professor of International Business at Florida International University. Dr. Carlos Parra is Clinical Professor of Information Systems and Business Analytics at Florida International University.

Corresponding author

Correspondence to Carlos M. Parra .

Ethics declarations

Competing interests.

The authors declare they have no competing interests.

Additional information

Publisher’s note.

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Open Access This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/ .

Reprints and permissions

About this article

Cite this article.

Paul, K., Parra, C.M. Corporate social responsibility in international business literature: results from text data mining of the Journal of International Business Studies . Int J Corporate Soc Responsibility 6 , 12 (2021). https://doi.org/10.1186/s40991-021-00066-6

Download citation

Received : 17 May 2021

Accepted : 28 September 2021

Published : 29 October 2021

DOI : https://doi.org/10.1186/s40991-021-00066-6

Share this article

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative

• Historical review
• International business

More From Forbes

Corporate social responsibility and business ethics.

• Share to Facebook
• Share to Twitter
• Share to Linkedin

Jeff Bartel is chairman and managing director of Hamptons Group, a private investment and strategic advisory firm headquartered in Miami.

The pyramid of corporate social responsibility (CSR) is evolving, and organizations must evolve with it. Popular theories of business ethics that once maintained profitability as the sole foundational base are giving way to new constructs that place social and environmental concerns on the same level, creating a triple bottom line proposition for corporate entities. Understanding that foundation and how business ethics plays a role in support is critical to developing processes, messaging and company cultures that support growth.

The Triple Bottom Line Has Upended The Pyramid Of Corporate Social Responsibility

Defined by Archie B. Carroll in the latter part of the 20th century, the pyramid of corporate social responsibility contended that companies had obligations in four key areas: profitability, legality, ethics and philanthropy. In Carroll’s model, these obligations were not all equal. Economic drivers were first and foremost, making profitability the pyramid’s base.

Built upon it (in decreasing importance) was the need to obey the law, engage in good business ethics and become a moral member of the community making local contributions.

That model does not work for businesses today. Consumers, governments and cultures are looking for more from corporate entities. It is still essential to maintain a profit. Profitable companies can be better contributors to the community than those that don’t earn a profit. It is equally necessary for businesses to shepherd social and environmental resources.

Thus, the triple bottom line is upending the pyramid, replacing it with a triune obligation toward profits, people and the planet.

The Difference Between Business Ethics And CSR

Best High-Yield Savings Accounts Of 2024

Best 5% interest savings accounts of 2024.

Doing the right thing, which means engaging in good business ethics, is not the same as corporate social responsibility. CSR is the onus on a business to act in the interest and for the benefit of the community whenever possible—sometimes even at the detriment of a profitable opportunity that may have adverse outcomes for the environment or people.

Business ethics is a broader concept that should govern everything a business and its people do. A company that operates ethically often makes decisions that support strong corporate social responsibility.

In short, if you were trying to re-create a pyramid of CSR with the understanding that profitability cannot be the base, business ethics might be a suitable replacement. When ethics inform everything else up the pyramid, businesses create more consistent approaches to modern CSR, from profits to corporate environmentalism.

Prioritizing Corporate Responsibility And Driving Strong Profits

It is clear to anyone involved in the corporate world that doing the right thing and making the most significant profit do not always align. However, that does not mean you cannot focus on corporate responsibility and ethical business practices while driving and delivering excellent financial profits.

First, modern customers and business partners care about corporate responsibility and ethics and increasingly choose to deal with companies that demonstrate them. While price remains a driver for purchasing decisions, customers also want to work with or buy from brands that align with their personal values. The advent of ethical consumerism is becoming a permanent and important factor in how and where people decide to buy, sell, consume and transact.

A firm’s focus solely on financial profitability may not support business responsibility and ethics. Doing what is suitable for the financial bottom line can sometimes take you off the path of doing what is right for people or the planet. Eventually, customers, clients and other stakeholders may take note of this and stop supporting your business, creating a slippery slope that drives profits down, even if you are focused on them exclusively.

Responsible, ethical businesses can also engage in cost savings when focused on sustainability. While these approaches may require short-term investments that impact profitability, they safeguard profits for the future.

Finally, value-based leaders are more likely to be dedicated to their workforce’s needs, investing in health and wellness initiatives, flexible scheduling and other programs that support work-life balance. That servant leadership approach creates more productive workers and more engaged employees, increasing cost savings and maximizing production. This leads to more significant returns.

Businesses Cannot Afford To Ignore Ethics And CSR

Ethics, values and corporate social responsibility are no longer elements of the pyramid built upon a base that solely prioritizes financial profitability. They are as important as economic stability for the future of businesses, particularly in light of ethical consumerism and corporate accountability in the public square. Corporations and other organizations cannot afford to ignore them.

Forbes Finance Council is an invitation-only organization for executives in successful accounting, financial planning and wealth management firms. Do I qualify?

• Editorial Standards
• Reprints & Permissions

CEO Religion and Corporate Social Responsibility: A Socio-behavioral Model

• Original Paper
• Open access
• Published: 20 April 2024

Cite this article

You have full access to this open access article

• Isabelle Le Breton-Miller 1 ,
• Danny Miller 1 ,
• Zhenyang Tang 2 &
• Xiaowei Xu 3  

500 Accesses

Explore all metrics

Studies linking religion to CSR have produced conflicting findings due to a failure to draw distinctions among religious influences and different CSR practices, and to theorize their connection. Drawing on social identity theory and the theory of planned behavior, we first argue that religion will influence CSR when ethical values from a CEO’s religious social identification resonate with an aspect of CSR. Second, CEO attitudes congruent with those values and forms of CSR—interpersonal empathy and proactiveness—will strengthen that relationship. Third, the relationship between religious social identification and CSR will be strengthened by a CEO’s ability to enact CSR policies, a function of personal and firm market power. Our research on 270 CEOs from 242 publicly traded US firms from 2007 to 2020 supports these relationships.

Similar content being viewed by others

Corporate Social Responsibility (CSR) Implementation: A Review and a Research Agenda Towards an Integrative Framework

Corporate Social Responsibility (CSR): The Role of Government in promoting CSR

Do ESG Controversies Matter for Firm Value? Evidence from International Data

Avoid common mistakes on your manuscript.

Introduction

Max Weber in his classic work The Protestant Ethic and the Spirit of Capitalism (1930) maintained that religious values could encourage business-related behavior such as risk taking, individualism, and wealth accumulation. Since then, scholars have been exploring possible connections between religion and business conduct—two fundamental bastions of society. With the growing interest in corporate social responsibility (CSR), studies of those relationships have increased. Unfortunately, they have led to conflicting arguments and results, perhaps because much of the literature is purely normative, while empirical studies of religion`s impact on CSR often fail to compare different sources and types of religious influence or CSR (Amer, 2023 ; Brammer et al., 2007 ; Su, 2019 ) or are lacking in replicable measures (see review by Van Aacken & Buchner, 2020 ). More importantly, too often, studies have failed to theorize the multiple underlying constructs linking religion and CSR, the resulting “black box” furthering the irreconcilability of the findings (Mazereeuw-van der Duijn Schouten et al., 2014 ; Van Aacken & Buchner, 2020 ; Weaver & Agle, 2002 ). We address these shortcomings by proposing and testing a socio-behavioral model of when and how the religion of top executives can influence the CSR of their organizations.

We do so by bridging social identity theory (Hogg, 2016 ; Tajfel & Turner, 2004 ) and the theory of planned behavior (Ajzen, 1985 ; Bosnjak et al., 2020 ). We argue that for the religion of a CEO to impact corporate behavior three conditions come into play: normative pressures, congruent attitudes, and control over behavior (Ajzen, 1985 ). In this study, religious social identification serves as a normative pressure, the attitude to behave according to those pressures is reflected by proactive empathy, and behavioral control is the power to act. Thus, first, there must be resonance between the source of religious influence and the type of CSR. In other words, the values associated with an executive’s religious identity must resonate with the CSR behavior enacting those values (Weaver & Agle, 2002 ). Second, the relationship between religious identity and CSR is conditioned by attitudes—the willingness to pursue religious values through specific CSR behavior (Ajzen, 1985 ; Mazereeuw-van der Duijn Schouten et al., 2014 ). Attitudes common across many religions include prosocial empathy and benevolence (Saroglou, 2006 ), notions favoring the social aspect of both religion and CSR (Heck, 2009 ; Ysseldyk et al., 2010 ). Third, the relationship between CEO religious identity and CSR will be conditioned by behavioral control—the ability to enact policies congruent with the values associated with the religious identification. That can be a function of the power of the CEO and his or her organization. Our study of 270 CEOs from 242 publicly traded US firms from 2007 to 2020 finds support for these relationships.

Research Contributions

We contribute to the literature on CSR in several ways. First, in bridging social identity theory (Hogg, 2016 ; Stets & Burke, 2000 ; Tajfel & Turner, 2004 ) and the theory of planned behavior (Ajzen, 1985 , 2020 ; Bosnjak et al., 2020 ), we develop a behavioral model incorporating constructs that support and moderate the relationship between religion and CSR. Specifically, we demonstrate how congruent attitudes and behavioral control—the ability to act—reinforce the connection between the values associated with religious social identity and specific aspects of CSR.

Second, we distinguish among the contextual versus personal sources of religious influence on corporate behavior, specifically, differentiating between geographic sources of influence (e.g. Hilary & Hui, 2009 ) versus personal religious identification (e.g. Maung et al., 2020 )—the latter being a potentially more direct and influential aspect of a CEO’s social identity. We also differentiate among specific varieties of CSR related to religious identity and focus on objective characteristics and measurable conditions of religious identification, attitudes, and CSR, thereby enhancing the precision and replicability of the research.

Third, we contribute to the literature on upper echelons (Finkelstein et al., 2009 ; Hambrick & Mason, 1984 ; Velte, 2020 , 2022 ) by demonstrating how several important and neglected aspects of CEOs, specifically, their religious identity and attitudes, shape their CSR initiatives.

Fourth, we identify the dimensions for relating religion to CSR that can be used to situate studies of other contexts. These suggest the importance of distinguishing religious contexts, sources, types of CSR, and the connections among them. Although predictions must differ depending on the parameters of these dimensions—the specific religion, source, and type of CSR—the dimensions apply broadly to studies relating religion to CSR. Moreover, their specification will facilitate more contextualized and therefore cumulative findings in future studies, and guard against overgeneralization. In that spirit, we note that our findings are intended to apply to CEO religiosity in publicly traded US companies.

In what follows, we first review the literature on the relationship between religion and CSR, highlighting current conflicts and gaps and demonstrating opportunities for more integrative and fine-grained theorizing. We then present our theoretical model, before deriving hypotheses, and presenting methods and findings. We conclude with conceptual reflections, limitations, and suggestions for further research.

The Literature on the Religious Drivers of CSR

Recent reviews find that there are many disagreements in the literature on religion and CSR. That is in part because of a failure to distinguish between different sources of CSR, types of CSR, and national contexts (Amer, 2023 ; Brammer et al., 2007 ; Dimic et al., 2024 ; van Aaken & Buchner, 2020 ). There has also been a failure to connect religious beliefs to the personal identities and mechanisms linking it to corporate action (Weaver & Agle, 2002 ).

For example, some studies have examined the relationships between corporate conduct and national religious differences (e.g. Ibrahim et al., 2008 ; Shu et al., 2022 ; Su, 2019 ; Velayutham, 2014 ). Others have focused on variations in regional religious institutional presence (e.g. Du et al., 2014 , 2015 ), while still others examine the impact of managers’ personal religiosity on CSR (e.g. Baxamusa & Jalal, 2016 ; Mazereeuw-van der Duijn Schouten et al., 2014 ; Xu & Ma, 2022 ).

Another source of variation is a focus on different varieties of CSR (e.g. Hilary & Hui, 2009 ; Iguchi et al., 2022 ; Oh et al., 2021 ; Shu et al., 2022 ). For example, Jenkins and Chapple ( 2011 ) and Jenkins et al. ( 2018 ) focus on religiosity and the environment, while Kim and Daniel ( 2016 ) explore its governance consequences.

Such diversity of focus—personal versus geographic religiosity, environmental versus social CSR, as well as differences in national contexts and religions—has resulted in disparate conclusions about the relationships between CSR and religion (Malik, 2015 ; Shu et al., 2022 ). Compare, for example, Ananthrum and Chan ( 2016 ), Chou et al. ( 2016 ), Harjoto and Rossi ( 2019 ) and Iguchi et al. ( 2022 ) who studied different contexts, religions, and CSR outcomes, with correspondingly different results. This variation can be useful as it expands our understanding. But when studies disagree, it is important to identify the sources of that disagreement and reconcile differences.

That reconciliation is made more difficult by a lack of theorization concerning the conditions that connect religion and CSR (Graafland et al., 2007 ; Weaver & Agle, 2002 ). Specifically, most studies connect religious values directly to CSR behavior, with little attempt to theorize the mechanisms that facilitate, condition, or impede such a relationship (Weaver & Agle, 2002 ). For example, useful studies by Harjoto and Rossi ( 2019 ), Maung et al., ( 2020 ) and Xu and Ma ( 2022 ) have shown how the religion of the CEO has a positive impact on CSR, but they say less about the personal attitudes and agentic capacity needed to enact religious beliefs through an organization.

We propose that more cumulative knowledge will come from research that (a) distinguishes between the influences of geographic versus personal religiosity; (b) distinguishes between the types or components of CSR; (c) is specific about the context of the study; and (d) explicitly theorizes the personal and organizational links connecting religion and CSR. We pursue these efforts in the hope of producing more contextualized findings and greater precision in relating religious identity to specific types of CSR.

CEO Religion and CSR: Theoretical Roots

In theorizing the connection between religious identity and CSR, it is useful to specify the causal linkages. If religion represents a core aspect of social identity (Batson et al., 2002 , 2005 ), it may or may not be acted upon. That requires a willingness to do so—a proactive attitude derived from the religion itself and the motivation to enact its values via practices such as empathy and benevolence toward resonant parties influenced by CSR (Saroglou, 2006 ; Saroglou et al., 2004 ). In turn, that willingness must be potentiated by ability—the power and discretion to act. Thus, the enactment of CSR-related religious values by a CEO in a corporate context depends on his or her religious identity and values, the attitude or willingness to enact those values via the firm, and the ability and power of the person to do so.

We draw upon two prominent behavioral theories to theorize these relationships between CEO religion and firm CSR. Social identity theory (Brown, 2000 ; Hogg, 2016 ; Tajfel & Turner, 2004 ) suggests that people identify with a variety of specific reference groups, such that they come to favor the values or norms of peers within those groups and see themselves as members of those groups, often delineated in contrast to other groups (Gupta et al., 2021 ). Religious association defines one such group, so that a religious identity may induce adherence to the associated norms and values (Stets & Burke, 2000 ; Ysseldyk et al., 2010 ).

However, the salience of a social identity—the tendency for its norms and values to be enacted—depends on congruent personal attitudes that connect those values with specific situations or behaviors (Lalonde & Silverman, 1994 ; Oakes, 1987 ; Stets & Burke, 2000 ). Attitudes can have cognitive, affective, and behavioral components, typically expressed as feelings and actions (Greenwald, 2014 ). They connect values with behavior, and thus are central to Ajzen’s ( 1985 , 1991 , 2020 ) theory of planned behavior. In predicting behavior, the theory combines normative factors like the religious values of social identity with personal attitudes. Thus, behavior is influenced not only by identifying with group values but by adopting complementary personal attitudes, empathic compassion, for example, applied to relevant situations. Such value-tied behavior is more likely to occur when people can control their behavior—thus the ability to act serves as a third factor influencing behavior (Ajzen, 2020 ; Conner & Armitage, 1998 ; Kim & Kim, 2020 ; Madden et al., 1992 ; Yuan et al., 2019 ). In combination, these theories suggest that the values associated with religious social identity, the personal attitudes favoring those values in a related situation, and the ability to enact these will shape behavior (Cordano & Frieze, 2000 ).

The robustness of this framework is suggested in part by its resonance across other domains. For example, in studies of family business, the willingness and ability of primary actors are seen as preconditions to business conduct, where willingness reflects both social values and personal attitudes (e.g. De Massis et al., 2014 ). More importantly, the framework can be applied to study religion and CSR in different geographic and religious contexts, and for different varieties of religious influence and CSR.

A Behavioral Model of Social Identity, Attitudes, and Abilities

The above discussion suggests that social identity , the attitudes for enacting its values and norms, and the ability to do so may each influence behavior, interacting to determine whether and how CEO religiosity influences CSR. Our model is presented in Fig.  1 (see also Table  1 ). First, the actor, in this case the CEO, must see a connection between their social identity, as reflected by its values and norms, and a related aspect of CSR. In other words, the CEO must relate these normative aspects of a religious social identity to the nature of the CSR action being considered. For example, if identifying with religious values prioritizes the benevolent prosocial treatment of proximate others, then followers should see that as salutary. If so, the socially beneficent aspect of CSR may be viewed as particularly laudable (Dyck, 2014 ; MacLeod, 2011 ; Saroglou, 2006 ). Footnote 1

A socio-behavioral model of religious identity and CSR

However, the values associated with a religious social identity do not necessarily imply that a CEO will possess the attitude or willingness to pursue them through CSR (Weaver & Agle, 2002 ). A religious identity may be adopted superficially or compartmentally and be insufficiently salient to influence firm-related behavior (Oakes, 1987 ). In other words, an executive may lack the sentiments and willingness to enact religious values at work (Weaver & Agle, 2002 ). A CEO is more likely to pursue religious norms through his or her firm when embracing attitudes such as empathy and compassion (Dyck, 2014 ; Vallerand et al., 1992 ). In addition, there needs to be correspondence between attitudes and behavior—for example, interpersonal compassion and the preference for socially directed versus, say, governance-oriented CSR (Ajzen, 2020 ). Indeed, Batson et al. ( 2005 ), Saroglou ( 2006 ), and others found that religiosity was associated with benevolence toward socially proximate individuals—like family, friends, and employees—but not toward more remote parties: anonymous shareholders or more abstract social causes, for example. It is only congruent attitudes that connect religious identity to intended behavior.

Finally, a third element is the perceived ability to act (Ajzen, 1985 ; Andrevski & Miller, 2022 ; Bosnjak et al., 2020 ). Individuals are more likely to act according to their religious identities if they sense that they have the power and resources to do so. Thus, CEOs must have adequate authority and sway within their organizations. Ability is also influenced by the condition of the firm—its security and power in the marketplace that affords it the resources or latitude to be socially proactive (Zhang et al., 2018 ).

In short, we believe that in examining the relationship between religion and CSR these details of normative social identity, personal attitudes, and ability are important influences. Without them aligning to connect religion to CSR, the relationship and theorizing of that association is obscured, and conflicting findings such as those we have referenced are more likely to arise.

Our hypotheses follow the structure of our model, relating in sequence to the value resonance between religious identity and CSR, the role of personal attitudes in conditioning that relationship, and the ability to act of the CEO as a final conditioning factor.

Sources of Religious Influence on CSR: Birthplace, Community, and CEO Religion

There are multiple possible sources of religious influence on CSR. Thus far, the literature has explored three main sources: the primary religion or religiosity of the geographic location of an organization (e.g. Cai et al., 2019 ; Du, 2017 ; Du et al., 2014 , 2015 ; Islam et al., 2021 ; Koleva, 2021 ; Murphy et al., 2019 ), the religion of the birthplace of key corporate actors who could influence the CSR behavior of their organizations (e.g. Lei et al., 2021 ; Lenski, 1961 ; Nurunnabi et al., 2020 ), and the personal religious identification of the CEO (e.g. Mazereeuw-van der Duijn Schouten et al., 2014 ; Dyck & Wong, 2010 ). As suggested by our discussion of social identity, we believe that the most important and immediate influence of religion on CSR will come from the latter—namely, personal public religious identification of the CEO—the most powerful organizational actor.

The religiosity of the geographic location of a firm’s head office may have less direct impact on a person’s social identity and thus on CSR (Xu & Ma, 2022 ). First, that religiosity may not pertain to the CEO who influences CSR practices: an agnostic CEO may live in a religious community and vice versa. An exception might be in homogenously theocratic countries where the values and practices of a religion are impressed upon both CEO identities and CSR conduct, or within highly religious communities (e.g. Murphy et al., 2019 ). However, it is unlikely that head office locations of major public corporations located in large multi-ethnic, multi-faith, secularized cities would show similar findings. Indeed, such urban secularization has been an important social trend in many parts of North America and Europe (Cox, 2013 ).

Another potential connection between religion and CSR is via the religiosity of the birthplace of the CEO (e.g. Lei et al., 2021 ). However, here again there may be little connection with the personal religious identification of executives and their places of birth or their ancestors. Moreover, CEOs may have departed from their birthplace long before the local religion could have influenced them.

By contrast, given that most CEOs do not mention their religious identification in public sources, when a CEO does personally, publicly, and voluntarily identify as being a member of a specific religious group, there is reason to believe that that identity may influence behavior both outside an organization and in acting as a top executive (Dyck, 2014 ; Dyck & Wong, 2010 ; Hemingway & Maclagan, 2004 ; Xu & Ma, 2022 ). Because most religions, including Christianity, advocate prosocial interpersonal values and behavior (Batson et al., 2005 ; Heck, 2009 ; Saroglou, 2006 ; Wade, 2010 )—values consistent with responsible corporate conduct—a positive association is expected between CEO religious identification and firm CSR. As noted, this is less likely to be the case for the religion of the CEOs birthplace or corporate head office location.

Hypothesis 1

The public personal religious identification of a CEO will be more related to firm CSR than the religiosity of the head office location or that of the CEO’s birthplace.

Certainly, others have found that head office religion also has an influence on CSR, particularly in countries with more religious populations and religions other than those dominant in the US (e.g. Brammer et al., 2007 ; Su, 2019 ). Moreover, we are not stating that community has no effect on CSR, merely that according to our theoretical model and study locale, CEO religion will have greater impact.

CEO Religious Identification and the Variety of CSR

As discussed, people define their identities in part as members of social groups and see those groups as embodying resonant values (Tajfel & Turner, 2004 ). One’s religious peers may constitute one such group, and religious affiliation may represent one aspect of a person’s social identification (Ysseldyk et al., 2010 ). When a religion is explicit in its values and normative tenets relating to behavior, then identification with that religion makes it more likely for such behavior to be valued and to take place. By contrast, where a religion is silent on types of behavior, it will have little effect on them.

Thus, it is important that there be a positive resonance between the normative tenets of an executive’s religion and specific elements of CSR (Ajzen & Fishbein, 1977 ; Ashforth & Mael, 1989 ; Vallerand et al., 1992 ). For example, most religions emphasize interpersonal ethics and values such as empathy and benevolence and the ethical treatment of others. This is true of Christianity, Judaism, Islam, Buddhism and other religions (e.g. Batson et al., 2002 , 2005 ; Heck, 2009 ; McCullough et al., 2003 ; Wade, 2010 ).

Indeed, there is significant research confirming such prosocial behavior of religious people; but toward those who are close to them and with whom they are in regular contact (Batson et al., 2005 ; McCullough et al., 2003 ; Saroglou, 2006 ). That includes family members, friends, neighbors, those whose judgment is valued, and those for whom they are responsible (Saroglou et al., 2004 ). For a CEO, employees fall into that category. Thus, religious values and religiosity resonate especially well with the social component of CSR (we shall call CSR-S) which prioritizes the positive, socially beneficent treatment of workers and ensuring their well-being and security. That may be reflected by fair employment practices, generous benefits, safe working conditions, contributions to the immediate community, access to healthcare, and similar policies and practices.

By contrast, religious identity and religiosity were not associated with more remote affected parties or issues. Saroglou ( 2006 : 3) confirms in his review of the literature and multiple empirical studies that: “We may then expect religiousness to predict prosociality toward close targets in need but to be unrelated to prosociality toward unknown targets.” Such more remote “targets” may include anonymous public shareholders, competitors, laws and regulations, or the broad, often remote community potentially affected by the natural environment.

Thus, given the social and interpersonal focus of many religions and their ancient roots and non-commercial orientations, treatment of the natural environment or issues of corporate governance are usually less emphasized. These more modern concerns are less directly tied to the values advocated by many religions (Batson et al., 2005 ; Heck, 2009 ; Saroglou, 2006 ). Thus, the relationship of religious identification and CSR is less likely to pertain to the natural environment or corporate governance. In other words, there is less reason to expect an association between a CEO’s religious identification and the pursuit of environmental aspects of CSR, such as green buildings, biodiversity, and renewable energy, or governance aspects such as standards concerning board membership, ownership structure or accounting practices.

We do qualify this hypothesis. Jenkins and Chapple ( 2011 ) and Jenkins et al. ( 2018 ), for example, found religiosity to have mixed implications for environmental social responsibility, while Kim and Daniel ( 2016 ) have explored its governance consequences by making national comparisons in emerging economies, finding significant variation. Nonetheless, these reviews have highlighted the mixed nature of findings, while reviews by religious scholars have highlighted the prosocial implications of religion toward more proximate parties such as families, friends, and those for whom one is responsible (Saroglou, 2006 ).

Hypothesis 2

CEO religious identification will relate more to the social component of CSR, than the environmental or governance components.

Attitudes as Moderators Between CEO Religion and the Social Component of CSR

Congruent personal attitudes reinforce the link between social identity and specific intended behaviors (Ajzen, 2020 ). The religious values associated with social identities will have more impact on personal behavior where they are embodied by personal attitudes. Attitudes are a broad psychological category with cognitive, affective, and behavioral components, sometimes expressed as opinions, feelings, and actions (Greenwald, 2014 ). They are mental representations connecting values and experience with behavior in specific situations.

For example, for individuals who are passively part of a religious demographic, that status is unlikely to influence their attitudes or behavior. By contrast, for more pious believers, their religious values may be manifested in congruent attitudes and behavior toward others. That can be reflected in personal attitudes such as empathy and a proactive orientation to enact religious values such as care for others (Dyck, 2014 ; Dyck & Wong, 2010 ). Specifically, empathic religious executives are especially likely to favor the prosocial aspects of CSR. Their felt affinity toward and responsibility for other people can serve as an important motivator of corporate social responsibility. Conversely, those whose attitudes are less empathic may be less inclined to connect their religious values to the social needs of their firm’s stakeholders. In short, CEO empathy toward others will enhance the relationship between CEO religious identification and CSR-S: the social aspect of CSR.

A related attitude is a willingness to act in a proactively beneficent way—to be charitable. Again, this is consistent with the common religious value of “doing unto others” (Heck, 2009 ; Wade, 2010 ). Therefore, charitable executives and those with a prosocial attitude—e.g. volunteers—will be more motivated to adopt CSR-S than those who are less charitable, more passive and content with the status quo (Han et al., 2022 ; Wei et al., 2018 ). Thus, a charitable and proactive orientation may enhance the relationship between CEO religious identification and CSR-S.

In this research, we could not measure CEO empathy or a proactive orientation directly from our data, and so we had to employ proxies based on consensus findings from prior studies. For empathy and compassion, we first looked at charitable donations, a direct measure of benevolence at the discretion of the CEO. We also took as a proxy the gender of the CEO. Studies of both cultural effects and neurological response have found highly consistent and uniform gender differences, whereby females are significantly more empathic and compassionate than males (see, for example, Chen et al., 2014 ; Christov-Moore et al., 2014 ; DeHart-Davis et al., 2006 ; Eisenberg et al., 1989 ; Lennon & Eisenberg, 1987 ; Mercadillo et al., 2011 ; Schulte-Ruther et al., 2008 ; and many others). More recently, studies have shown that female CEOs in health care organizations tended to do more to enhance the compassionate treatment of patients than their male counterparts (Galstian et al., 2018 ; Silvera & Clark, 2021 ). Female executives also are said to have a positive effect on socially directed CSR (Boukattaya & Omri, 2021 ; Madison et al., 2021 ). Thus, there is significant evidence that gender can serve as a proxy for attitudes of empathy and compassion.

The second attitude expected to enhance the relationship between CEO religion and CSR-S is a willingness to engage in proactive behavior —a tendency to enact one’s values in personal and organizational life. Again, we employed a demographic proxy for that behavior—namely the age of the CEO. Studies have found that proactive social voluntarism is most common when individuals are in their mid-40 s, a young age for a CEO (Norris, 2004 ). Youth is typically associated with more physical energy and active engagement (Speakman & Westertherp, 2010 ) as well as more socially proactive behavior (Bertolino et al., 2011 ). Indeed, numerous studies have found that younger CEOs tend to be more proactive than older ones (Barba Navaretti et al., 2022 ; Cho & Kim, 2017 ; Serfling, 2014 ; Wiersema & Bantel, 1992 ). Thus, we employ CEO age (younger than 50) as a proxy for a proactive orientation.

Hypothesis 3a

CEO empathy, proxied by gender and charitable contributions, will positively moderate the relationship between religiosity and CSR-S.

Hypothesis 3b

CEO proactiveness, proxied by youthfulness, less than 50 years old, will positively moderate the relationship between religiosity and CSR-S.

Ability to Enact CSR of the CEO and the Firm

Even when a CEO’s religious identification resonates with elements of CSR, he or she requires the power and resources to behave accordingly. For example, CEOs with little influence are less able to undertake discretionary initiatives such as CSR than those with ample decision-making power. One indicator of CEO influence is ownership stake in the company. CEOs who are major owners of a company have more discretion to make decisions. First, they may have enough ownership to overrule less significant owners or board members (Ghosh et al., 2007 ). Second, even when they are not the largest owners in the company, their ownership aligns their incentives with the interests of other shareholders, enhancing their discretion. This is in part because significant ownership of CEOs reassures board members that they are emotionally invested in and identify with the company and its future (Chin et al., 2013 ), thereby deserving more latitude to enact discretionary priorities (Ghosh et al., 2007 ). By contrast, CEOs who are minimal owners have less direct power vis-à-vis boards and other owners, and perhaps less credibility with board members; that may restrict their ability to pursue discretionary CSR initiatives (Oh et al., 2016 ).

Another factor influencing a CEO’s perceived ability to invest in CSR is market power (Cottrill, 1990 ). Where a firm is struggling competitively with large rivals, its CEO may need to limit investments in CSR to prioritize revenues and profit. But when it is an influential player with abundant market share, the CEO is more likely to have the confidence and reputation to invest in CSR initiatives (Hutzschenreuter & Kleindienst, 2013 ). The same holds true when the firm has more market power due to market share concentration, which can provide a strong competitive position from which to engage in costly CSR activities not connected directly to revenue generation (Islam et al., 2021 ; Lee et al., 2018 ). Table 1 and Fig.  1 summarize our model.

Hypothesis 4a

CEO power conferred by personal ownership and discretion will positively moderate the relationship between CEO religiosity and CSR.

Hypothesis 4b

Firm market power will positively moderate the relationship between CEO religiosity and CSR.

We manually collect a sample of US CEOs of public firms with personal information available from the Marquis Who’s Who database, which claims to provide “unmatched coverage of the lives of today’s leaders and achievers from the USA and around the world, and from every significant field of endeavor.” Specifically, we start with CEOs of S&P 1500 firms from 2007 to 2020, identify their names in Execucomp, and manually collect their self-identified religious beliefs (if any) and birthplace information. We drop CEOs not covered by Who’s Who and those not disclosing birthplace information. To ensure appropriate matching, we drop CEOs whose years of birth do not match Execucomp records. We then merge the data with the MSCI ESG database for ESG (i.e., CSR) ratings, and with the American Religion Data Archive (ARDA) database for CEO birthplace and firm community religiosity. In the process, we drop firms not covered by MSCI ESG and CEOs whose birthplaces are not covered by ARDA (including CEOs born outside the US). Finally, we obtain financial data from Compustat, and drop firms with missing financial information or negative book equity values. Our final sample consists of 270 CEOs from 242 firms and 1507 firm-year observations.

Personal Religious Belief

As noted, data on CEO religious belief was from Marquis Who’s Who. Each year, Marquis surveys high profile individuals in all fields and publishes biographical information from the questionnaires sent to these individuals. We define a dummy variable Religious CEO which equals 1 if the CEO self-identifies her religious belief, and 0 otherwise. We note that religious affiliations are self-reported, and disclosure of religion is completely voluntary. We argued that compared to the CEOs who choose not to disclose their religion—most of our sample—those who voluntarily do so are more likely to adhere to and enact its values and norms because public disclosure suggests social identification with a religion (Maung et al., 2020 ). Although CEOs may not report their religion for various reasons, that is unlikely to bias our findings in any systematic way.

Birthplace Religiosity

We manually collect the CEO’s birthplace city and date of birth from Marquis Who’s Who and identify its county. Following Hilary and Hui ( 2009 ), we measure religiosity using church membership data from the American Religion Data Archive (ARDA). ARDA provides data for church and church membership at the county level in 1952, 1971, and each decade afterward; for each CEO, we use the ARDA data published for the decade the CEO was born, or closest to the CEO birth year (for example, a CEO born in 1962 is linked to 1971 ARDA data) Footnote 2 . We then define the level of religiosity at the CEO birthplace county ( Birthplace Religiosity ) as the number of church-affiliated members divided by the total county population. In some cases, a big city (e.g. New York) may be linked to multiple counties, and we use the average religiosity of all associated counties.

Headquarters’ Religiosity

To identify a firm’s headquarters religiosity, we first obtain the zip code of the firm’s headquarters location from Compustat and then identify the county code associated with the zip code. Like for birthplace religiosity, headquarters religiosity ( HQ Religiosity ) is church membership divided by total county population. We use 2010 ARDA data for headquarters religiosity, because 2010 is the only year during our sample period (2007–2020) that ARDA data are published.

Corporate Social Responsibility: ESG

Data for corporate social responsibility are from MSCI ESG. Serafeim and Yoon ( 2023 ) argue that compared to other CSR rating sources, MSCI has the broadest coverage of US firms and is best in predicting future ESG (i.e., CSR) developments and associated market reactions. Each year, MSCI utilizes multiple sources, including annual reports, government data, investor presentations, news media, and direct communication with the companies, to assess over 30 ESG key issues that represent risks and opportunities for a firm and its industry. Key issues are then grouped into three main categories, representing the Environment (E), Social (S), and Governance (G) pillars. The environmental pillar covers issues such as carbon and toxic emissions, packaging waste, and renewable energy. The social pillar is focused on issues of human capital development, health and safety issues, access to social opportunities, and product liability. The governance pillar covers issues such as board structure, shareholder rights, executive compensation, and tax transparency. MSCI calculates a score for E, S, and G by aggregating key issues under each according to the impact and time horizon of a risk or opportunity. MSCI also calculates an overall ESG (i.e., CSR) score as a weighted average of key issues. Each score ranges from 0 to 10; a higher number indicating the firm leads its industry in managing ESG risks and opportunities.

Other Variables

We include geographic controls for CEO birthplace location and firm headquarters location poverty, education, and population. These controls are included to avoid endogeneity due to their relationships to ESG or religiosity. Specifically, education and poverty rate are documented to affect both local religiosity (e.g. Lenski, 1961 ; Stark, 1972 ) and ESG (Ioannou & Serafeim, 2012 ), while Husted et al. ( 2016 ) show that populous major cities or financial centers encourage ESG engagement. Poverty rate is the percentage of people living under the federal poverty threshold based on household size and family makeup. Education is defined as percentage of population over the age of 25 with a bachelor’s degree or higher. Population is the natural logarithm of county population. These data are from the decennial US Census Bureau. Because birthplace characteristics could affect religious beliefs mostly in the childhood family environment, we measure these in the decennial year closest to the CEO’s birth. Because ethnicity has been shown to affect religiosity (Iannaccone, 1998 ), and red/blue party affiliation is often linked to ESG (Hong & Kostovetsky, 2012 ), we also consider birthplace ethnic diversity—percentage white, and headquarters county red-blue political balance from electoral maps—Republican proportion in the recent presidential election.

At the CEO level, we control for the natural logarithm of CEO age and gender, and CEO compensation, obtained from ExecuComp. Borghesi et al. ( 2014 ) show female and younger CEOs to invest more in CSR. Multiple studies also show that compensation of top-level managers may relate to CSR efforts as may CEO ownership (Berrone & Gomez-Mejia, 2009 ; Coombs & Gilley, 2005 ).

We also control for conventional firm level characteristics in the literature that may influence a firm’s ESG engagement. Specifically, we adopt the natural logarithm of total book assets to control for firm size. We include ROA (net income/total book assets) and Book/Market (book value of equity/market value of equity) because firms with superior performance and market valuations tend to make greater ESG commitments (Ioannou & Serafeim, 2012 ). We also control for leverage (long term debt/total assets) because easy access to finance can boost corporate social responsibility (Cheng et al., 2014 ). All these variables are from Compustat.

Table 2 reports descriptive statistics. The ESG ratings and three pillars of E, S and G show similar standard deviations and their means all cluster around 5 out of 10. As for religiosity, we see that only 16.3% of our sample CEOs identify with a religious group, while approximately half the population in their birthplace county and firm headquarters county are religious. Footnote 3 Religiosity levels of CEO birthplace and firm headquarters are not significantly different. The distribution of control variables confirms that large firms tend to locate in blue, more populous counties with better education. CEOs are mostly male and born mostly in white counties.

The correlation matrix is presented in Table  3 . The three pillars of ESG are highly correlated. When examining their correlations with religiosity measures, we find that religious CEOs are associated with higher overall ESG ratings and S ratings, but not higher E. Birthplace and headquarters religiosity are not positively associated with ESG; if anything, the correlation coefficients are negative.

Table 4 regresses ESG and its three components, E, S, and G, on our three measures of religiosity, along with control variables. To absorb industry, year, and state effects, we include fixed effects for SIC 2-digit industries, years, and states. In columns 1–4, the variable of interest is Religious CEO . In columns 5–8, the variable of interest is Birthplace Religiosity . In columns 9–12, the variable of interest is HQ Religiosity .

The main findings in Table  4 support Hypothesis 1. Specifically, whereas there is a positive and significant association between CEO personal religious belief and overall ESG ratings, we do not find such association for CEO birthplace religiosity or firm headquarters religiosity. It appears that religion has its strongest association with ESG when a CEO voluntarily identifies as being a religious adherent; in contrast, a CEO’s growing up in a religious environment or working for a firm located in a religious environment does not relate much to firm overall ESG.

Despite the positive correlations among E, S, and G, their associations with religiosity vary. The strong positive association between Religious CEO and ESG is almost completely attributable to the S pillar (column 3), where the coefficient for Religious CEO is 0.327 (about two thirds of that in column 1) and statistically significant at the 1% level. The “economic magnitude” of this relationship is also substantial: compared with a non-religious CEO, a religious CEO is associated with an S score which is 0.327 higher (about 7% higher). By contrast, in E and G columns 2 & 4, the coefficient estimates for Religious CEO are not significant. Thus, our findings support Hypothesis 2 that CEO religious identification relates significantly to the social component of ESG, but not the environmental or governance components.

Among control variables, we see that female CEOs are associated with higher ESG ratings, confirming that they are more willing to engage in ESG activities in general (Boukattaya & Omri, 2021 ; Madison et al., 2021 ; Norris, 2004 ). Bigger firms also tend to have higher ESG ratings, probably because they can afford ESG initiatives. Among the geographic variables, we see that the red county dummy and poverty rate (for CEO birthplace and firm headquarters) are negatively associated with ESG-S. These results are consistent with previous studies (Hong & Kostovetsky, 2012 ; Ioannou & Serafeim, 2012 ). Somewhat surprisingly, population education was negatively associated with ESG, especially the S component. This may be due to multi-collinearity between poverty and education. Footnote 4 Table 3 reveals these to be negatively correlated; but education does not correlate with ESG or S. We find that if we drop poverty rate, the coefficient and significance of education drop sharply. Hence, the coefficient is biased due to multi-collinearity, but coefficients for our religiosity measures are not affected.

An important consideration in our analyses is that CEO religious identification can be endogenous. One concern is that CEOs of bigger and more profitable firms may feel more confident to reveal their religion, and these firms also tend to have higher ESG ratings (Udayasankar, 2008 ). To address this possibility, we employ a propensity score matching (PSM) model. First, we regress Religious CEO on potential determinants of CEO religious identification: birthplace and firm headquarters religiosity, red headquarters indicator, poverty rate (of birthplace and headquarters), education (of birthplace and headquarters), population (of birthplace and headquarters), white percentage of birthplace, age, gender, compensation, firm size, firm ROA, firm leverage, and firm book/market ratio. This provides each CEO’s propensity score to self-identify as religious. We then match each religious CEO with a non-religious CEO who has the closest propensity score and re-estimate our prior regressions with the propensity matched sample. We report the results in Table  5 . The rigorous 1:1 closest neighbor PSM method reduces our sample size substantially to 392 observations. However, our key findings hold: CEO personal religious belief remains positively associated with ESG and especially the S pillar, but not with the E or G pillars. In addition to the PSM model, we also tried to directly examine changes in ESG scores around CEO turnovers for better identification of causality. In untabulated results, we show that when a religious CEO replaces a non-religious one, an increase in Religious CEOs is associated with an increase in ESG-S , but not with the overall ESG, E, or G component. Footnote 5 Lastly, one may also argue that there could be other CEO level variables, such as CEO cultural background, that influence ESG scores. Whereas it is difficult to rule out this possibility, this should not be of great concern as our sample covers only US born CEOs, and we include birthplace characteristics that shape CEO cultural values as control variables in all our regressions. In summary, our baseline findings were not likely driven by endogenous CEO religious identification.

To evaluate Hypotheses 3a and 3b, we consider three proxies for CEO attitudes toward S: empathy, proxied by gender and charitable donations, and proactiveness, proxied by age. We define a Female CEO dummy which equals 1 if a CEO is female; a Young CEO dummy , which equals 1 if a CEO is younger than 50; and a Donation dummy, which equals 1 if the firm has made a philanthropic donation of at least one million during the year. Footnote 6 Otherwise the dummy variables are set to 0. In Table  6 , we interact Religious CEO with the Female CEO dummy, the Young CEO dummy , and the Donation dummy. These interaction terms are statistically significant and positive. These results support both Hypotheses 3a and 3b that CEO gender and charitable donations (empathy) or age (proactiveness) can substantially enhance the positive effect of religious identification on ESG, especially S.

In addition to an attitude of willingness, their power and resources can play an important part in how CEOs enact ESG (Kim & Kim, 2020 ; Yuan et al., 2019 ). We consider two dimensions. The first is CEO ownership. Whereas more ownership suggests interest alignment between CEOs and shareholders, enhancing the discretion of the former, it also may give the CEO enough voting power or influence to be well-entrenched (Morck et al., 1988 ). Second, we consider the external competition as firms facing such external threats are less likely to engage in CSR activities. (Hutzschenreuter & Kleindienst, 2013 ).

Table 7 reports regression results using CEO ownership as a proxy for CEO power. We consider two CEO ownership thresholds: one is 5% ( Powerful CEO 5% ), and the other is the median CEO ownership in our sample ( Powerful CEO Median ). Powerful CEO 5% and Powerful CEO Median are dummies equaling 1 if the CEO ownership is greater than 5% and the sample median, respectively, and 0 otherwise. We find that the interaction terms absorb almost all the effect of Religious CEO . In other words, our results are particularly strong for CEOs with high firm ownership, consistent with Hypothesis 4a.

In Table  8 , we consider firm market power which may enhance a CEO’s ability to devote firm resources to engaging in ESG. Specifically, we define HHI (Herfindahl Index) as the sum of the squared market share of sales of each firm in the SIC 2-digit industry. High HHI equals 1 if a firm is in an industry with higher than median HHI (i.e., there is less competition), and 0 otherwise. High Market Share equals 1 if a firm has an above-median market share (measured by percentage of sales of the total sales in the SIC 2-digit industry) and 0 otherwise. When we include interaction terms of Religious CEO with these two dummies, we show that the interaction terms are statistically significant at the 5% level and positive, consistent with Hypothesis 4b.

Post Hoc Analysis

Although the literature does not provide clear guidance on which religions are more pro-ESG compared to others, some studies seem to suggest that different religions may embrace tenets associated with their unique cultural and social contexts, and hence different components of ESG. In “Appendix 1 ,” we offer preliminary results based on different CEO personal beliefs (i.e., Protestant, Catholic, and Other). Most religious CEOs in our sample self-identify as Christians (about 68.4%), with 34.3% self-identifying as Protestants and 34.1% self-identifying as Catholics. Other religions are too rare in our sample to afford meaningful conclusions. Thus, in this study, the association between CEO religion and the social component of the ESG is indeed mainly driven by Christian CEOs. These results are consistent with studies on the proactive social initiatives associated with Christian values (e.g. “do unto others”) (Dyck, 2014 ; Dyck & Wong, 2010 ; Vallerand et al., 1992 ).

Finally, we conducted additional tests to ensure the robustness of our results—all available from the authors. Specifically, in untabulated tests we find that our results are virtually the same when we drop birthplace and headquarters variables from the regressions and exclude non-Christian CEOs from the sample. In addition, results are robust when we use per capita income instead of poverty rate at CEO birthplace or firm headquarters or use population density instead of total population. In “Appendix 2 ,” we replicate our main analyses in an expanded sample formed by excluding birthplace religiosity for which there is much data missing. We show that personal religiosity remains a significant predictor for ESG and S in a vastly larger sample of over 12,000 observations.

We have argued and shown that studies of the relationships between religion and CSR can benefit by distinguishing the sources of religious influence, the nature of CSR, and especially by more explicit theorization of the factors constituting, driving, and conditioning that relationship. By drawing upon social identity theory (Tajfel & Turner, 2004 ) and the theory of planned behavior (Ajzen, 1985 ), we developed and tested a socio-behavioral model relating religion to CSR. Our analysis differentiates among the religious sources and types of CSR, specifies how the relationship between the two can be shaped by their normative resonance, and is in turn conditioned by related attitudes and the ability to enact them.

First, we suggested that given its more immediate normative impact, a CEO’s personal religious identity would influence CSR more than company location or CEO birthplace. Second, given the focus of most religions on empathy and compassion toward other people (Batson et al., 2005 ; Heck, 2009 ; Saroglou, 2006 ), we argued that the above relationship would be stronger for the social versus environmental or governance aspects of CSR. We then noted the importance of congruent personal attitudes and ability in conditioning this relationship. Our hypotheses were supported by our main analyses, robustness tests and propensity matching to minimize endogeneity. In brief, we found that CEOs who publicly identified their religion did indeed tend to pursue the social aspects of CSR rather than other aspects, and that this relationship was conditioned by resonant empathic attitudes and the personal and organizational ability to engage in CSR initiatives.

Our bridging of social identity theory (Tajfel & Turner, 2004 ) with the theory of planned behavior (Ajzen, 1985 ) allowed us to develop a socio-behavioral model that will also be useful for relating other types of identity with related aspects of CSR, such as environmentalism and governance arrangements. For example, might democratic or liberal identities foster green practices (Chin et al., 2013 )? Would conservative or libertarian identities affect governance practices? Which personal attitudes, abilities and facilitators of discretion will condition those relationships? In short, the roles played by personal attitudes—beliefs, emotions, and cognitions—warrant more exploration for their relationship with different kinds of religious identities and CSR (Castro-Gonzalez et al., 2019 ). Another topic of potential interest could be to investigate the influence of religious heterogeneity of the top management team on the nature of CSR initiatives, or alternatively, the impact of religious heterogeneity versus uniformity in the community or organization.

Our analysis demonstrates that in examining the influence of religion on CSR, subsequent studies should take care to distinguish sources of religious influence, for example, the religiosity of head office or CEO birthplace locations versus the expressed religious identity of focal actors. In addition, it will be useful to consider the different types of CSR and their resonance with different religious beliefs and degrees of religiosity. These precisions should facilitate more contextualized and therefore cumulative findings in future studies, and caution against overgeneralization.

Certainly, our study has limitations. As noted, we do not wish to suggest that a religious identity always leads to socially proactive CSR or that those who are not religious will de-emphasize CSR. Moreover, our data were limited in that our sample consisted mostly of American born CEOs of public US firms identifying as members of a branch of Christianity: as noted we caution generalization beyond that context. Thus, we urge studies into the influence of other religions on CEO and CSR behavior and in different geographic and religious contexts. In addition, the relationships we propose are likely to vary in intensity as a function of how devoutly CEOs practice their religion—i.e., the salience of that identity—something we could not measure directly. Also, due to our focus on objective indicators, we employed multiple proxies for CEO empathy and proactive proclivity. It will be useful for other researchers to assess these qualities via qualitative or questionnaire studies directly polling CEOs and their associates. Finally, like most cross-sectional studies and despite our efforts to establish robustness, it is impossible to rule out endogeneity in our analyses. Again, fine-grained analyses will be useful to tease out the subtle causal effects between religion, CSR priorities, and CSR.

If the religion emphasized more abstract views pertaining to the primacy of the natural world, environmentalism might be a more resonant type of CSR for the CEO to embrace (Iguchi et al., 2022 ).

One limitation of the approach is that we cannot observe when CEOs left their birthplace locations, and hence cannot rule out the possibility that some CEOs may have moved right after birth.

The county religiosity values are the percentages of county population that are church members, following Hilary and Hui ( 2009 ). These values are similar to the percentage reported in Hilary and Hui ( 2009 ).

Our regressions have relatively low variance inflation factors (VIFs), indicating that our results are not subject to severe multi-collinearity. For example, in our baseline S regression concerning CEO personal religion (column 3 in Table  4 ), the average VIF is 3.17 (excluding fixed effects), far below the commonly used threshold of 10. Most of the variables have low VIF values between 1 and 3, while geographic variables (education, poverty rate and population) have VIF values ranging from 3 to 6.2—again, not too high.

In this set of regressions, we use the change in ESG score after CEO turnover as the dependent variable. The variable of interest is change in the self-identified religion after CEO turnover. A significant limitation of this analysis is that there are only 72 cases of CEO turnovers in our sample, and the regressions have few degrees of freedom and limited power when control variables are included. These results are available upon request.

The donation data is taken from the Million Dollar List compiled by the Indiana University Lilly Family School of Philanthropy.

Ajzen, I. (1985). From intentions to actions: A theory of planned behavior. In J. Kuhl & J. Beckmann (Eds.), Action control (pp. 11–39). Springer.

Chapter   Google Scholar  

Ajzen, I. (1991). The theory of planned behavior. Organizational Behavior and Human Decision Processes, 50 (2), 179–211.

Article   Google Scholar  

Ajzen, I. (2020). The theory of planned behavior: Frequently asked questions. Human Behavior and Emerging Technologies, 2 (4), 314–324.

Ajzen, I., & Fishbein, M. (1977). Attitude-behavior relations: A theoretical analysis and review of empirical research. Psychological Bulletin, 84 (5), 888–918.

Amer, M. (2023). Systematic review of religiosity and social responsibility. Journal of Business and Socioeconomic Development . https://doi.org/10.1108/JBSED-02-2023-0007 . in Press.

Ananthram, S., & Chan, C. (2016). Religiosity, spirituality and ethical decision-making: Perspectives from executives in Indian multinational enterprises. Asia Pacific Journal of Management, 33 , 843–880.

Andrevski, G., & Miller, D. (2022). Forbearance: Strategic nonresponse to competitive attacks. Academy of Management Review, 47 (1), 59–74.

Ashforth, B. E., & Mael, F. (1989). Social identity theory and the organization. Academy of Management Review, 14 (1), 20–39.

Barba Navaretti, G., Castellani, D., & Pieri, F. (2022). CEO age, shareholder monitoring, and the organic growth of European firms. Small Business Economics, 59 (1), 361–382.

Batson, C. D., Ahmad, N., Lishner, D. A., & Tsang, J.-A. (2002). Empathy and altruism. In C. R. Snyder & S. J. Lopez (Eds.), Handbook of positive psychology (pp. 485–498). Oxford University Press.

Google Scholar  

Batson, C. D., Anderson, S. L., & Collins, E. (2005). Personal religion and prosocial motivation. In Maher, M. L., & Karabenick, S. A. (Eds.) Motivation and religion (special issue). Advances in Motivation and Achievement,   14 , pp. 151–185

Baxamusa, M., & Jalal, A. (2016). CEO’s religious affiliation and managerial conservatism. Financial Management, 45 (1), 67–104.

Berrone, P., & Gomez-Mejia, L. R. (2009). Environmental performance and executive compensation: An integrated agency-institutional perspective. Academy of Management Journal, 52 (1), 103–126.

Bertolino, M., Truxillo, D. M., & Fraccaroli, F. (2011). Age as moderator of the relationship of proactive personality with training motivation, perceived career development from training, and training behavioral intentions. Journal of Organizational Behavior, 32 (2), 248–263.

Borghesi, R., Houston, J. F., & Naranjo, A. (2014). Corporate socially responsible investments: CEO altruism, reputation, and shareholder interests. Journal of Corporate Finance, 26 , 164–181.

Bosnjak, M., Ajzen, I., & Schmidt, P. (2020). The theory of planned behavior: Selected recent advances and applications. Europe’s Journal of Psychology, 16 (3), 352.

Boukattaya, S., & Omri, A. (2021). Impact of board gender diversity on corporate social responsibility and irresponsibility: Empirical evidence from France. Sustainability, 13 (9), 4712.

Brammer, S., Williams, G., & Zinken, J. (2007). Religion and attitudes to corporate social responsibility in a large cross country sample. Journal of Business Ethics, 71 , 229–243.

Brown, R. (2000). Social identity theory: Past achievements, current problems and future challenges. European Journal of Social Psychology, 30 (6), 745–778.

Cai, Y., Kim, Y., Li, S., & Pan, C. (2019). Tone at the top: CEOs’ religious beliefs and earnings management. Journal of Banking & Finance, 106 , 195–213.

Castro-González, S., Bande, B., Fernández-Ferrín, P., & Kimura, T. (2019). Corporate social responsibility and consumer advocacy behaviors: The importance of emotions and moral virtues. Journal of Cleaner Production, 231 , 846–855.

Chen, W., Lu, J., Liu, L., & Lin, W. (2014). Gender differences of empathy. Advances in Psychological Science, 22 (9), 1423.

Cheng, B., Ioannou, I., & Serafeim, G. (2014). Corporate social responsibility and access to finance. Strategic Management Journal, 35 (1), 1–23.

Chin, M. K., Hambrick, D. C., & Treviño, L. K. (2013). Political ideologies of CEOs: The influence of executives’ values on corporate social responsibility. Administrative Science Quarterly, 58 (2), 197–232.

Cho, S. Y., & Kim, S. K. (2017). Horizon problem and firm innovation: The influence of CEO career horizon, exploitation, and exploration on breakthrough innovations. Research Policy, 46 (10), 1801–1809.

Chou, S. Y., Chang, T., & Han, B. (2016). A Buddhist application of corporate social responsibility: Qualitative evidence from a case study of a small Thai family business. Small Enterprise Research, 23 (2), 116–134.

Christov-Moore, L., Simpson, E. A., Coudé, G., Grigaityte, K., Iacoboni, M., & Ferrari, P. F. (2014). Empathy: Gender effects in brain and behavior. Neuroscience & Biobehavioral Reviews, 46 , 604–627.

Conner, M., & Armitage, C. J. (1998). Extending the theory of planned behavior: A review and avenues for further research. Journal of Applied Social Psychology, 28 (15), 1429–1464.

Coombs, J. E., & Gilley, K. M. (2005). Stakeholder management as a predictor of CEO compensation: Main effects and interactions with financial performance. Strategic Management Journal, 26 (9), 827–840.

Cordano, M., & Frieze, I. H. (2000). Pollution reduction preferences of US environmental managers: Applying Ajzen’s theory of planned behavior. Academy of Management Journal, 43 (4), 627–641.

Cottrill, M. T. (1990). Corporate social responsibility and the marketplace. Journal of Business Ethics, 9 , 723–729.

Cox, H. (2013). The secular city: Secularization and urbanization in theological perspective . Princeton University Press.

Book   Google Scholar  

DeHart-Davis, L., Marlowe, J., & Pandey, S. K. (2006). Gender dimensions of public service motivation. Public Administration Review, 66 (6), 873–887.

De Massis, A., Kotlar, J., Chua, J. H., & Chrisman, J. J. (2014). Ability and willingness as sufficiency conditions for family-oriented particularistic behavior: Implications for theory and empirical studies. Journal of Small Business Management, 52 (2), 344–364.

Dimic, N., Fatmy, V., & Vähämaa, S. (2024). Religiosity and corporate social responsibility: A study of firm-level adherence to Christian values in the United States. Corporate Social Responsibility and Environmental Management, 31 (1), 396–413.

Du, X., Jian, W., Zeng, Q., & Du, Y. (2014). Corporate environmental responsibility in polluting industries: Does religion matter? Journal of Business Ethics, 124 , 485–507.

Du, X., Jian, W., Lai, S., Du, Y., & Pei, H. (2015). Does religion mitigate earnings management? Evidence from China. Journal of Business Ethics, 131 , 699–749.

Du, X. (2017). Religious belief, corporate philanthropy, and political involvement of entrepreneurs in Chinese family firms. Journal of Business Ethics, 142 , 385–406.

Dyck, B. (2014). God on management: The world’s largest religions, the “theological turn”, and organization and management theory and practice. Religion and Organization Theory, 41 , 23–62.

Dyck, B., & Wong, K. (2010). Corporate spiritual disciplines and the quest for organizational virtue. Journal of Management, Spirituality & Religion, 7 (1), 7–29.

Eisenberg, N., Fabes, R. A., Schaller, M., & Miller, P. A. (1989). Sympathy and personal distress: Development, gender differences, and interrelations of indexes. New Directions for Child Development, 44 , 107–126.

Finkelstein, S., Hambrick, D. C., & Cannella, A. A. (2009). Strategic leadership: Theory and research on executives, top management teams, and boards . Oxford University Press.

Galstian, C., Hearld, L., O’Connor, S. J., & Borkowski, N. (2018). The relationship of hospital CEO characteristics to patient experience scores. Journal of Healthcare Management, 63 (1), 50–61.

Ghosh, A., Moon, D., & Tandon, K. (2007). CEO ownership and discretionary investments. Journal of Business Finance & Accounting, 34 (5–6), 819–839.

Graafland, J., Kaptein, M., & Mazereeuw-van der Duijn Schouten, C. (2007). Conceptions of God, normative convictions, and socially responsible business conduct: An explorative study among executives. Business & Society, 46 (3), 331–368.

Greenwald, A. G. (2014). Why attitudes are important: Defining attitude. In A. Pratkanis, S. J. Blecker, & A. G. Greenwald (Eds.), Attitude structure and function (pp. 1–11). Psychology Press.

Gupta, A., Fung, A., & Murphy, C. (2021). Out of character: CEO political ideology, peer influence, and adoption of CSR executive position by Fortune 500 firms. Strategic Management Journal, 42 (3), 529–557.

Hambrick, D. C., & Mason, P. A. (1984). Upper echelons: The organization as a reflection of its top managers. Academy of Management Review, 9 (2), 193–206.

Han, Y., Chi, W., & Zhou, J. (2022). Prosocial imprint: CEO childhood famine experience and corporate philanthropic donation. Journal of Business Research, 139 , 1604–1618.

Harjoto, M. A., & Rossi, F. (2019). Religiosity, female directors, and corporate social responsibility for Italian listed companies. Journal of Business Research, 95 , 338–346.

Heck, P. L. (2009). Common ground: Islam, Christianity, and religious pluralism . Georgetown University Press.

Hemingway, C., & Maclagan, P. (2004). Managers’ personal values as drivers of corporate social responsibility. Journal of Business Ethics, 50 (1), 33–44.

Hilary, G., & Hui, K. W. (2009). Does religion matter in corporate decision making in America? Journal of Financial Economics, 93 (3), 455–473.

Hogg, M. A. (2016). Social identity theory . Springer.

Hong, H., & Kostovetsky, L. (2012). Red and blue investing: Values and finance. Journal of Financial Economics, 103 (1), 1–19.

Husted, B. W., Jamali, D., & Saffar, W. (2016). Near and dear? The role of location in CSR engagement. Strategic Management Journal, 37 (10), 2050–2070.

Hutzschenreuter, T., & Kleindienst, I. (2013). (How) Does discretion change over time? A contribution toward a dynamic view of managerial discretion. Scandinavian Journal of Management, 29 (3), 264–281.

Iannaccone, L. R. (1998). Introduction to the economics of religion. Journal of Economic Literature, 36 (3), 1465–1495.

Ibrahim, N., Howard, D., & Angelidis, J. (2008). The relationship between religiousness and corporate social responsibility orientation. Journal of Business Ethics, 78 (1/2), 165–174.

Iguchi, H., Katayama, H., & Yamanoi, J. (2022). CEOs’ religiosity and corporate green initiatives. Small Business Economics, 58 , 497–522.

Ioannou, I., & Serafeim, G. (2012). What drives corporate social performance? The role of nation-level institutions. Journal of International Business Studies, 43 , 834–864.

Islam, S. M. T., Ghosh, R., & Khatun, A. (2021). Slack resources, free cash flow and corporate social responsibility expenditure: Evidence from an emerging economy. Journal of Accounting in Emerging Economies, 11 (4), 533–551.

Jenkins, W., & Chapple, C. K. (2011). Religion and environment. Annual Review of Environment and Resources, 36 , 441–463.

Jenkins, W., Berry, E., & Kreider, L. B. (2018). Religion and climate change. Annual Review of Environment and Resources, 43 , 85–108.

Kim, J., & Daniel, S. J. (2016). Religion and corporate governance: Evidence from 32 countries. Asia-Pacific Journal of Financial Studies, 45 (2), 281–308.

Kim, M., & Kim, T. (2020). When do CEOs engage in CSR activities? Performance feedback, CEO ownership, and CSR. Sustainability, 12 (19), 8195.

Koleva, P. (2021). Towards the development of an empirical model for Islamic corporate social responsibility: Evidence from the Middle East. Journal of Business Ethics, 171 , 789–813.

Lalonde, R. N., & Silverman, R. A. (1994). Behavioral preferences in response to social injustice: The effects of group permeability and social identity salience. Journal of Personality and Social Psychology, 66 (1), 78–85.

Lee, J. H., Byun, H. S., & Park, K. S. (2018). Product market competition and corporate social responsibility activities: Perspectives from an emerging economy. Pacific-Basin Finance Journal, 49 , 60–80.

Lei, Z., Petmezas, D., Rau, P. R., & Yang, C. (2021). Local boy does good: CEO birthplace identity and corporate social responsibility.  Retrieved from SSRN . https://doi.org/10.2139/ssrn.3718687

Lennon, R., & Eisenberg, N. (1987). Gender and age differences in empathy and sympathy. In N. Eisenberg & J. Strayer (Eds.), Empathy and its development (pp. 195–217). Cambridge University Press.

Lenski, G. E. (1961). The religious factor: A sociological study of religion’s impact on politics, economics, and family life . Doubleday and Company.

MacLeod, M. (2011). Religion and the rise of global corporate social responsibility. The Review of Faith & International Affairs, 9 (3), 29–36.

Madden, T. J., Ellen, P. S., & Ajzen, I. (1992). A comparison of the theory of planned behavior and the theory of reasoned action. Personality and Social Psychology Bulletin, 18 (1), 3–9.

Madison, K., Eddleston, K. A., Kellermanns, F. W., & Powell, G. N. (2021). Kinship and gender in family firms: New insights into employees’ organizational citizenship behavior. Family Business Review, 34 (3), 270–295.

Malik, M. (2015). Value-enhancing capabilities of CSR: A brief review of contemporary literature. Journal of Business Ethics, 127 , 419–438.

Maung, M., Miller, D., Tang, Z., & Xu, X. (2020). Value-enhancing social responsibility: Market reaction to donations by family vs. non-family firms with religious CEOs. Journal of Business Ethics, 163 , 745–758.

Mazereeuw-van der Duijn Schouten, C., Graafland, J., & Kaptein, M. (2014). Religiosity, CSR attitudes, and CSR behavior: An empirical study of executives’ religiosity and CSR. Journal of Business Ethics , 123 (3), 437–459.

McCullough, M. E., Tsang, J.-A., & Brion, S. (2003). Personality traits in adolescence as predictors of religiousness in early adulthood: Findings from the Terman Longitudinal Study. Personality and Social Psychology Bulletin, 29 , 980–991.

Mercadillo, R. E., Díaz, J. L., Pasaye, E. H., & Barrios, F. A. (2011). Perception of suffering and compassion experience: Brain gender disparities. Brain and Cognition, 76 (1), 5–14.

Morck, R., Shleifer, A., & Vishny, R. W. (1988). Management ownership and market valuation: An empirical analysis. Journal of Financial Economics, 20 , 293–315.

Murphy, M. J., MacDonald, J. B., Antoine, G. E., & Smolarski, J. M. (2019). Exploring Muslim attitudes towards corporate social responsibility: Are Saudi business students different? Journal of Business Ethics, 154 , 1103–1118.

Norris, P. (2004). Young people and political activism . Research paper: Harvard University, John F. Kennedy School of Government. (32p). Paper for the conference ‘Civic engagement in the 21st Century: Toward a Scholarly and Practical Agenda’ at the University of Southern California, Oct 1–2 2004.

Nurunnabi, M., Alfakhri, Y., & Alfakhri, D. H. (2020). CSR in Saudi Arabia and Carroll’s pyramid: What is ‘known’and ‘unknown’? Journal of Marketing Communications, 26 (8), 874–895.

Oakes, P. (1987). The salience of social categories. In J. Turner (Ed.), Rediscovering the social group (pp. 117–141). Blackwell.

Oh, W. Y., Chang, Y. K., & Cheng, Z. (2016). When CEO career horizon problems matter for corporate social responsibility: The moderating roles of industry-level discretion and blockholder ownership. Journal of Business Ethics, 133 , 279–291.

Oh, H., Bae, J., Currim, I. S., Lim, J., & Zhang, Y. (2021). Influence of CEOs’ religious affiliations on firms’ advertising spending and shareholder value. European Journal of Marketing, 55 (5), 1440–1468.

Saroglou, V., Delpierre, V., & Dernelle, R. (2004). Values and religiosity: A meta-analysis of studies using Schwartz’s model. Personality and Individual Differences, 37 , 721–734.

Saroglou, V. (2006). Religion’s role in prosocial behavior: Myth or reality? Psychology of Religion Newsletter, 31 (2), 1–8.

Schulte-Rüther, M., Markowitsch, H. J., Shah, N. J., Fink, G. R., & Piefke, M. (2008). Gender differences in brain networks supporting empathy. NeuroImage, 42 (1), 393–403.

Serafeim, G., & Yoon, A. (2023). Stock price reactions to ESG news: The role of ESG ratings and disagreement. Review of Accounting Studies, 28 , 1500–1530.

Serfling, M. A. (2014). CEO age and the riskiness of corporate policies. Journal of Corporate Finance, 25 , 251–273.

Shu, C., Hashmi, H. B. A., Xiao, Z., Haider, S. W., & Nasir, M. (2022). How do Islamic values influence CSR? A systematic literature review of studies from 1995–2020. Journal of Business Ethics, 181 , 471–494.

Silvera, G. A., & Clark, J. R. (2021). Women at the helm: Chief executive officer gender and patient experience in the hospital industry. Health Care Management Review, 46 (3), 206–216.

Speakman, J. R., & Westerterp, K. R. (2010). Associations between energy demands, physical activity, and body composition in adult humans between 18 and 96 y of age. The American Journal of Clinical Nutrition, 92 (4), 826–834.

Stark, R. (1972). The economics of piety: Religious commitment and social class. In G. W. Theilbar & S. D. Feldman (Eds.), Issues in social inequality (pp. 483–503). Little Brown.

Stets, J. E., & Burke, P. J. (2000). Identity theory and social identity theory. Social Psychology Quarterly, 63 (3), 224–237.

Su, K. (2019). Does religion benefit CSR. Evidence from China. Corporate Responsibility and Environmental Management, 26 (6), 1206–1221.

Tajfel, H., & Turner, J. C. (2004). An integrative theory of intergroup conflict. In M.-J. Hatch & M. Schultz (Eds.), Organizational identity: A reader (pp. 56–66). Oxford University Press.

Udayasankar, K. (2008). Corporate social responsibility and firm size. Journal of Business Ethics, 83 (2), 167–175.

Vallerand, R. J., Deshaies, P., Cuerrier, J. P., Pelletier, L. G., & Mongeau, C. (1992). Ajzen and Fishbein’s theory of reasoned action as applied to moral behavior: A confirmatory analysis. Journal of Personality and Social Psychology, 62 (1), 98–109.

Van Aacken, D., & Buchner, F. (2020). Religion and CSR: A systematic literature review. Journal of Business Economics, 90 , 917–945.

Velayutham, S. (2014). “Conventional” accounting vs “Islamic” accounting: The debate revisited. Journal of Islamic Accounting and Business Research, 5 (2), 126–141.

Velte, P. (2020). Do CEO incentives and characteristics influence corporate social responsibility (CSR) and vice versa? A literature review. Social Responsibility Journal, 16 (8), 1293–1323.

Velte, P. (2022). Meta-analyses on corporate social responsibility (CSR): A literature review. Management Review Quarterly, 72 (3), 627–675.

Wade, R. (2010). Bridging Christianity, Islam, and Buddhism with virtue ethics. In K. Engebretson, M. De Souza, G. Durka, & L. Gearon (Eds.), International handbook of inter-religious education (Vol. 4, pp. 313–324). Springer.

Weaver, G. R., & Agle, B. R. (2002). Religiosity and ethical behavior in organizations: A symbolic interactionist perspective. Academy of Management Review, 27 (1), 77–97.

Weber, M. (1930). The protestant ethic and the spirit of capitalism . Routledge.

Wei, J., Ouyang, Z., & Chen, H. A. (2018). CEO characteristics and corporate philanthropic giving in an emerging market: The case of China. Journal of Business Research, 87 , 1–11.

Wiersema, M. F., & Bantel, K. A. (1992). Top management team demography and corporate strategic change. Academy of Management Journal, 35 (1), 91–121.

Xu, B., & Ma, L. (2022). Religious values motivating CSR: An empirical study from corporate leaders’ perspective. Journal of Business Ethics, 176 , 487–505.

Ysseldyk, R., Matheson, K., & Anisman, H. (2010). Religiosity as identity: Toward an understanding of religion from a social identity perspective. Personality and Social Psychology Review, 14 (1), 60–71.

Yuan, Y., Tian, G., Lu, L. Y., & Yu, Y. (2019). CEO ability and corporate social responsibility. Journal of Business Ethics, 157 , 391–411.

Zhang, Y., Li, J., Jiang, W., Zhang, H., Hu, Y., & Liu, M. (2018). Organizational structure, slack resources and sustainable corporate socially responsible performance. Corporate Social Responsibility and Environmental Management, 25 (6), 1099–1107.

Download references

No funding was received to assist with the preparation of this manuscript. The authors declare they have no financial interests.

Author information

Authors and affiliations.

HEC Montréal, 3000 Côte-Sainte-Catherine Rd, Montréal, Canada

Isabelle Le Breton-Miller & Danny Miller

Clark University, 950 Main Street, Worcester, MA, USA

Zhenyang Tang

University of Rhode Island, 7 Lippit Rd, Kingston, RI, USA

You can also search for this author in PubMed   Google Scholar

Corresponding author

Correspondence to Xiaowei Xu .

Ethics declarations

Conflict of interest.

Isabelle Le Breton-Miller declares that she has no conflict of interest. Danny Miller declares that he has no conflict of interest. David Tang declares that he has no conflict of interest. Xiaowei Xu declares that she has no conflict of interest.

Ethical approval

For this type of study formal consent is not required.

Additional information

Publisher's note.

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Appendix 1: ESG and Different Religions

This table reports the effect of different CEO religious beliefs on firm ESG and its three components (E, S, and G). The variables of interest are dummies for Protestant and Catholic CEOs. All regressions include industry, year, and state fixed effects. Heteroskedasticity robust t -values are reported in parentheses. *, **, and *** indicate statistical significance at the 10%, 5%, and 1% levels, respectively.

Appendix 2: Regressions with the Expanded Sample

This table reports regression results with the expanded sample that does not require CEO birthplace information. All regressions include industry, year, and state fixed effects. Heteroskedasticity robust t -values are reported in parentheses. *, **, and *** indicate statistical significance at the 10%, 5%, and 1% levels, respectively.

Rights and permissions

Open Access This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/ .

Reprints and permissions

About this article

Le Breton-Miller, I., Miller, D., Tang, Z. et al. CEO Religion and Corporate Social Responsibility: A Socio-behavioral Model. J Bus Ethics (2024). https://doi.org/10.1007/s10551-024-05650-x

Download citation

Received : 27 July 2023

Accepted : 22 February 2024

Published : 20 April 2024

DOI : https://doi.org/10.1007/s10551-024-05650-x

Share this article

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative

• Corporate social responsibility
• CEO religious identification
• Social identity theory
• Theory of planned behavior
• Find a journal
• Publish with us
• Track your research

• SUGGESTED TOPICS
• The Magazine
• Newsletters
• Managing Yourself
• Managing Teams
• Work-life Balance
• The Big Idea
• Data & Visuals
• Reading Lists
• Case Selections
• HBR Learning
• Topic Feeds
• Account Settings
• Email Preferences

Impact Accounting: Raising ESG Reporting Standards

Sponsor content from Pure Storage.

by Charles Giancarlo

Environmental, social, and governance (ESG) frameworks began in 2004 as a concept from the United Nations to help investors assess a company’s global impact and drive corporate responsibility. In the 20 years since its introduction as a broad concept without strict guidelines, ESG has become politicized. Detractors argue that it introduces divisive social causes into corporate decision making.

Certainly, there are many areas for serious debate within the topics of social responsibility and corporate governance. However, anything done with greater efficiency is a general good. Reducing waste and pollution is positive for all concerned, and the reduction of uncontrolled costs to society is to be applauded.

Still, the ESG measurement landscape has become highly fragmented, marked by inconsistent standards and , making environmental reporting unreliable , often misleading, and difficult to interpret. Today, 75% of companies say they are unprepared for upcoming ESG audits, according to Reuters .

Confusing Calculations

Companies reporting ESG metrics must sift through many layers of supply and distribution chains over which they have little oversight and must deal with diverse methodologies, agencies, and reports. They must estimate the environmental impact of partners far out in their supply chains with which they have no direct business, leading to both scalability and accuracy issues, and to potential manipulation, as SEC settlements show. If unchecked, ESG compliance costs will rise sharply, risking report reliability, according to CNN .

The confusing comparisons of various ESG measurements’ environmental performance exemplify the challenge businesses and consumers face in evaluating products’ and companies’ environmental claims. “Greenwashing”—companies’ dishonest efforts to embellish their environmental credentials, engage in selective reporting, or use carbon credits with dubious effectiveness—has become a common problem.

No reasonable person would argue about whether companies should do better in addressing sustainability issues. Proponents say ESG has proved to be a compass for identifying companies that excel financially, demonstrating that prioritizing environmental sustainability, social responsibility, and governance is both good economics and good ethics.

However, disentangling ESG’s components into separate priorities would simplify and reduce needless complexity and disagreement. With the advancement of artificial intelligence, new energy and environmental challenges will also necessitate new dialogue among all stakeholders.

The Impact of Impact Accounting

So the question remains: How can organizations most efficiently and effectively reduce their corporate environmental impact with integrity and clarity?

Historically, market-based mechanisms and transparent corporate practices have driven global economic growth, expanding the middle class and enhancing living standards worldwide. Today’s environmental sustainability challenges stem from the absence of these market-based mechanisms in managing critical resources, pollution, and waste.

The good news is that the practices and tools exist to address this measurement gap through impact accounting . By using impact accounting standards, companies can:

• Use their existing cost accounting capabilities for externalities—the indirect costs (such as carbon dioxide or other pollution) that companies impose on society but that do not show up in their financial statements or products’ specifications;

• Use universal standardized measures for these indirect costs; and

• Employ standard audit practices and auditors to ensure fair, common, and supportable numbers and reports across companies and industries.

Impact accounting is transparent and scalable because it allows each organization to use the metrics its direct suppliers provide to its own accounts, and then to transform these inputs into metrics for their customers.

This is a far more efficient process than having every company analyze the many layers in its supply chain. It uses standardized metrics for each critical resource and integrates them into its financial reporting. And it allows companies to incorporate these costs into their product pricing and features. In so doing, impact accounting also creates a competitive market based on products’ environmental qualities, while fostering transparency through standard auditing oversight.

For public companies, impact accounting transforms the environmental landscape. It introduces a market-based mechanism that quantifies the environmental impact of production, packaging, and usage of products and services in monetary terms, creating a competitive market for the reduction of externalities, which in time will lead to a significant reduction of external costs to society.

Through impact accounting, each supplier can disclose to customers the true resource costs to manufacture and use their product, in addition to the product’s price. The practice expands traditional cost accounting to incorporate societal costs—addressing the gap where companies cover direct costs, like consumption of energy and materials, but not the environmental costs of emissions or waste disposal.

Integrating these costs into both product sales and corporate financial reporting allows companies to report profits alongside resource usage such as energy, water, precious metals, and even plastics, providing a true total cost of production and a true audited view of the environmental footprint to ensure fairness and comparability. Importantly, impact accounting is a scalable and efficient practice for businesses that aligns with increasing consumer demand for sustainable practices, marrying profitability with sustainability.

Leading Sustainable Change

Modern efficiency relies on accurate pricing and audited statements, fostering business trust. Impact accounting extends this trust by quantifying indirect costs, promoting efficiency, and allowing choices based on resource efficiency and product value. This approach is gaining traction among institutions like Pure Storage.

Adopting impact accounting and innovating to reduce the energy and carbon footprint of business takes society steps closer to a transparent, accountable, and sustainable future, which is beneficial for our collective well-being. Pure Storage is replacing outdated, energy-intensive hard disk drives with efficient flash storage, cutting energy use and power-related emissions by up to 85%, and setting the standard in environmental reporting in the data storage industry through impact accounting.

We call on technology leaders to help reduce the energy demands of data centers, which are projected to double to 4% of global electricity use in the next two years. Impact accounting will reduce the cost of and confusion in ESG reporting and benefit all customers, significantly strengthen our communities, and allow businesses to play a sizable role in leading us toward a more sustainable future.

Learn more about Pure Storage’s sustainable tech infrastructure and its impact on reducing energy consumption and minimizing e-waste.

Charles Giancarlo is the CEO of Pure Storage