Corporate social responsibility: Institutional response to labor, legal and shareholder environments

Corporate social responsibility (CSR) is widely regarded as the response of corporations to societal pressures with respect to social issues such as human rights and the environment. Much the way Burt (1983) argued that corporations use philanthropy as a marketing ploy, effectively "co-opting" their target audiences, we argue that CSR represents actively adopted strategies in response to the pressures corporations face in the local institutional environments in which they are embedded. We show that corporations have been aggressive in adopting CSR institutions and practices when they are (1) publicly traded, (2) in areas that are high in union density, and (3) are located in federal appellate jurisdictions that have been aggressive in their standards for protecting workers' rights. Drawing on research in neoinstitutional analysis in organizational sociology, we interpret these findings to indicate that corporations have responded to localized employment pressures by adopting strategies that allow them to appear legitimate in this realm. Specifically, corporations deal with pressures surrounding responsible employment practices by adopting the practices of the CSR regime.