Sustainable Development Drivers

Sustainable Development Drivers

The Role of Leadership in Government, Business and NGO Performance

Edited by Kees Zoeteman

Sustainable development cannot be prescribed – rather, it results from conscious personal choices in government, business and NGOs. This thought-provoking book explores both the origins and future of the global sustainable development movement, and provides an original overview of the driving forces of sustainable development, including market forces and past and future trends.

Chapter 8: Drivers of Corporate Social Responsibility

Johan Graafland and Hugo Smid

Subjects: business and management, business leadership, development studies, development studies, economics and finance, environmental economics, environment, environmental economics


Johan Graafland and Hugo Smid SUMMARY Corporate Social Responsibility (CSR) is found to have an ambiguous influence on profitability. Yet companies take up a proactive attitude towards CSR. Other drivers for CSR than direct economic profitability are discussed on the basis of a literature survey. Three categories of such drivers are internal, external and other factors, including company characteristics such as type of sector, company size and ownership. This chapter presents in total three sets of value-related internal factors, four types of other company characteristics and eight sets of external factors that influence the CSR of companies. External factors involve types of regulation, social pressure by non-governmental organizations (NGOs) and aspects of market operation. The greater the extent to which governments address social and ecological problems by regulation, the less room there is for CSR policies of companies. Small- and medium-sized enterprises (SMEs) rely more on government regulation, whereas large companies will establish more self-regulatory mechanisms to control their social and environmental performance. Companies are less likely to pursue a CSR strategy if there is either too much or too little competition. Many of the drivers discussed show interrelationships. A framework is presented describing these relations. INTRODUCTION As globalization and the productivity of humanity increases, the negative external effects of production and consumption patterns become increasingly problematic and threaten human welfare. One way to address those negative externalities is to enhance the working of markets. Since the regulating power of national and international governments is limited in a globalizing world,...

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