Walking and Talking Corporate Social Responsibility: Implications of Firm Size and Organizational Cost

• Published date: 01 November 2016
• Author: Andreas Georg Scherer,Laura J. Spence,Christopher Wickert
• Date: 01 November 2016
• DOI: http://doi.org/10.1111/joms.12209

Walking and Talking Corporate Social Responsibility:

Implications of Firm Size and Organizational Cost

Christopher Wickert, Andreas Georg Scherer

and Laura J. Spence

VU University Amsterdam; University of Zurich; Royal Holloway, University of London

ABSTRACT In this paper we address two interrelated research gaps in the Corporate Social

Responsibility (CSR) literature. The first results from a lack of understanding of different

patterns of CSR engagement with respect to CSR talk (impression management and the

creation of symbolic images and documentation) and CSR walk (substantive implementation of

CSR policies, structures and procedures). Related to this, the second gap concerns limited

knowledge about the influence of firm size on CSR engagement. We develop a conceptual

model that explains differences in CSR talk versus walk based on organizational cost and firm

size. This allows us to theorize the antecedents of what we call the large firm implementation gap

(large firms tend to focus on communicating CSR symbolically but do less to implement it

into their core structures and procedures) and vice versa the small firm communication gap (less

active communication and more emphasis on implementation). Our model expands a new

theoretical understanding of CSR engagement based on as yet underemphasized firm-level

antecedents of CSR, and opens up several new avenues for future, and in particular

comparative, research.

Keywords: corporate social responsibility, firm size, multinational corporations,

organizational cost, small and medium-sized enterprises, small business

INTRODUCTION

Corporate Social Responsibility (CSR) continues to advance despite a range of inad-

equately understood and sometimes contradictory phenomena. CSR can be defined ‘as

actions that appear to further some social good, beyond the interests of the firm and

that which is required by law’ (McWilliams and Siegel, 2001, p. 117). Increases in the

presumed sophistication of responsible business initiatives occur concurrently with wave

Address for reprints: Christopher Wickert, VU University Amsterdam, Department of Management &

Organization, Faculty of Economics and Business Administration, De Boelelaan 1105, 1081 HV Amster-

dam, The Netherlands (christopher.wickert@vu.nl).

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C2016 John Wiley & Sons Ltd and Society for the Advancement of Management Studies

Journal of Management Studies 53:7 November 2016

doi: 10.1111/joms.12209

upon wave of corporate scandals and accusations of harmful behaviour. Meanwhile con-

cerns proliferate that CSR initiatives have had only marginal positive impact on social

and environmental conditions (Locke, 2013; Whiteman et al., 2013). We contribute to

the explanation of these incongruities and explore the influence of firm size, organiza-

tional structure and related cost implications on CSR.

A central issue in the CSR debate is the distinction between, colloquially speaking,

‘talking’ and ‘walking’ social, ethical and environmental responsibility in a business con-

text (e.g., Berliner and Prakash, 2015; Haack et al., 2012). We understand these ele-

ments collectively as a firm’s CSR engagement (McWilliams and Siegel, 2001), which we

define as an overarching concept of how firms combine the two key dimensions of CSR

– (1) the primarily externally facing documentation of corporate responsibilities (‘talk’)

and (2) the implementation of strategies, structures and procedures in core business

processes within and across divisions, functions, value chains, etc., that facilitate corpo-

rate responsibility (‘walk’). We will show that the two components of CSR engagement

have a tendency to be incongruent and influenced by firm size. CSR talk encompasses

‘the various outbound communication channels deployed by organizations to communi-

cate with customers and other constituencies’ (Balmer and Greyser, 2006, p. 735), such

as CSR reports, corporate websites, advertising and product labelling (Du et al., 2010).

By contrast CSR walk encompasses substantive ‘actions within the firm, such as changing

methods of production to reduce environmental impacts or changing labour relation-

ships both within the firm and across the firm’s value chain’ (Aguilera et al., 2007,

p. 836).

Previous research has acknowledged the inconsistency of individual firm CSR

engagements. Companies are frequently criticized for not walking the talk (e.g.,

Lyon and Montgomery, 2015; McDonnell and King, 2013). Roberts for instance

(2003, p. 250) is concerned that ‘all this talk of ethics is just that – talk; new forms

of corporate self-presentation that have no reference to (...) what is practised in the

name of the corporation, beyond (...) good public relations. In this form, corporate

social responsibility is cheap and easy’. Scholars have investigated the presumed

(mis)match between CSR talk and walk, under labels such as ‘greenwashing’ (e.g.,

Bowen, 2014; Delmas and Burbano, 2011) or ‘decoupling’ (e.g., Haack et al., 2012;

Marquis and Qian, 2014).

However, extant research widely neglects the influence of firm size on patterns of

CSR engagement (see critically e.g., Aguilera et al., 2007; Campbell, 2007; Scherer and

Palazzo, 2007; Scherer at al., 2016). Taking a comparative perspective on CSR is

important both from a practical and theoretical point of view, because the large firm

perspective – accounting for the vast majority of research and public attention – is usu-

ally assumed to apply to all organizational types (see critically e.g., Mitchell et al., 1997;

Tang et al., 2012). Refuting the appropriateness of this, however, is a growing body of

research on smaller firms that on average constitute 95 per cent of businesses worldwide

(Muller et al., 2014). This research shows that many small firms have substantive and

effective approaches to CSR, while these are distinct from large firms (Gray et al., 1995;

Spence, 2016). Small firms engage in CSR based on implicit behavioural guiding princi-

ples rather than formal structures and codes of conduct common in large firms (Jenkins,

2004; Wickert, 2014).

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C2016 John Wiley & Sons Ltd and Society for the Advancement of Management Studies