This essay seeks to give a contractarian foundation to the concept of Corporate Social Responsibility (CSR), meant as an extended model of corporate governance of the firm. Whereas, justificatory issues have been discussed in a related paper (Sacconi, L.: 2006b, this journal), in this essay I focus on the implementation of and compliance with this normative model. The theory of reputation games, with reference to the basic game of trust, is introduced in order to make sense of self-regulation as a way to implement the social contract on the multi-fiduciary model of corporate governance. This affords understanding of why self-regulation, meant as mere recourse to a long-run strategy in a repeated trust game, fails. Two basic problems for the functioning of the reputation mechanism are examined: the cognitive fragility problem, and the motivational problem. As regards the cognitive fragilities of reputation (which result from the impact of unforeseen contingencies and from bounded rationality), the paper develops the logic and the structure that self-regulatory norms must satisfy if they are to serve as gap-filling tools with which to remedy cognitive limitations in the reputation mechanism. The motivation problem then arises from the possibility of sophisticated abuse by the firm. Developed in this case is an entirely new application of the theory of conformism-and-reciprocitybased preferences, the result of which is that the stakeholders refuse to acquiesce to sophisticated abuse on the part of the firm.

A Social Contract Account for CSR as Extended Model of Corporate Governance (II): Compliance, Reputation and Reciprocity / Sacconi, Lorenzo. - In: JOURNAL OF BUSINESS ETHICS. - ISSN 0167-4544. - STAMPA. - 75:n.1, September(2007), pp. 77-96.

A Social Contract Account for CSR as Extended Model of Corporate Governance (II): Compliance, Reputation and Reciprocity

Sacconi, Lorenzo
2007-01-01

Abstract

This essay seeks to give a contractarian foundation to the concept of Corporate Social Responsibility (CSR), meant as an extended model of corporate governance of the firm. Whereas, justificatory issues have been discussed in a related paper (Sacconi, L.: 2006b, this journal), in this essay I focus on the implementation of and compliance with this normative model. The theory of reputation games, with reference to the basic game of trust, is introduced in order to make sense of self-regulation as a way to implement the social contract on the multi-fiduciary model of corporate governance. This affords understanding of why self-regulation, meant as mere recourse to a long-run strategy in a repeated trust game, fails. Two basic problems for the functioning of the reputation mechanism are examined: the cognitive fragility problem, and the motivational problem. As regards the cognitive fragilities of reputation (which result from the impact of unforeseen contingencies and from bounded rationality), the paper develops the logic and the structure that self-regulatory norms must satisfy if they are to serve as gap-filling tools with which to remedy cognitive limitations in the reputation mechanism. The motivation problem then arises from the possibility of sophisticated abuse by the firm. Developed in this case is an entirely new application of the theory of conformism-and-reciprocitybased preferences, the result of which is that the stakeholders refuse to acquiesce to sophisticated abuse on the part of the firm.
2007
n.1, September
Sacconi, Lorenzo
A Social Contract Account for CSR as Extended Model of Corporate Governance (II): Compliance, Reputation and Reciprocity / Sacconi, Lorenzo. - In: JOURNAL OF BUSINESS ETHICS. - ISSN 0167-4544. - STAMPA. - 75:n.1, September(2007), pp. 77-96.
File in questo prodotto:
File Dimensione Formato  
JoBECSR1.pdf

Solo gestori archivio

Tipologia: Post-print referato (Refereed author’s manuscript)
Licenza: Tutti i diritti riservati (All rights reserved)
Dimensione 240.43 kB
Formato Adobe PDF
240.43 kB Adobe PDF   Visualizza/Apri

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11572/69648
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus ND
  • ???jsp.display-item.citation.isi??? ND
social impact