It’s not just hypocrisy if firms don’t do what they say. In an in-depth study of multinational corporations involving almost 400 interviews with managers and their stakeholders, we find different reasons why firms don’t always implement the corporate social responsibility (CSR) policies that they publicly espouse.
One of the primary rationales is attention to the bottom line: when managers view CSR policies as costly and not contributing to their financial performance, they’re likely to act inconsistently with the content of their firms’ sustainability reports.
But there’s no need to view all firms cynically. A second rationale is the frequent contradiction between local pressures facing specific plants and overall firm policy: stakeholders often have inconsistent, or unclear, expectations of a firm’s corporate social responsibility. Managers are not necessarily deceptive (“faking it”), but rather seem to “muddle through” when faced with complex, rapidly changing, stakeholder pressures. This leads to policies being adopted that are not consistently implemented on the ground.
Crilly, D., Zollo, M., & Hansen, M. 2012. Faking it or muddling through? Understanding decoupling in response to stakeholder pressures. Academy of Management Journal, in press.