The Influence of Shareholders on Corporate Social Responsibility

Shareholders are an important group of stakeholders influencing management and corporate activity through the two channels of shareholder activism and socially responsible investing. The main ways shareholders engage corporations on their social performance have undergone changes since the 1960s, both in their prevalence and their characteristics. In addition to providing essential background information on the two shareholder engagement strategies, this paper draws parallels with and connections to the overall historical development of Corporate Social Responsibility (CSR). This paper also highlights those organizations or events that have been pivotal in the historical development of the shareholder-CSR relationship to indicate future avenues for more in-depth research

The Influence of Shareholders on Corporate Social Responsibility

Despite persistence of the image of shareholders as narrow-minded profit maximizers who demand that managers ignore calls for a broader social responsibility of business, shareholders have become some of the most important allies of the corporate social responsibility (CSR) movement. This paper examines the intersection of shareholder engagement and CSR from a historical perspective. It provides background information about two central avenues through which shareholders engage the corporation – shareholder activism and socially responsible investing—and then traces how these avenues have shaped and been shaped by the CSR movement. Part one of this paper focuses on shareholder activism (SA). After a brief overview of the legal and procedural framework for SA, the paper turns to a discussion of the types of issues shareholder activists have pursued over the years and how corporate responses have developed in turn. By tracing these developments, it becomes evident that SA has played an important role in the development of the corporate social responsibility movement in several ways. First, an increase in SA supported the formation of organizations that allowed individuals to channel concerns and expectations about the responsible conduct of corporations. Second, SA around social issues challenged existing legal boundaries and initiated a shift in legislation as well as judicial interpretation of regulations. This shift allowed a broader array of CSR issues to be brought directly to the attention of corporations through the annual proxy process, which in turn increased the public’s awareness of the relevance of responsible corporate conduct. As a response to increased shareholder and public support for CSR, corporations started to embrace CSR as a strategic opportunity rather than as a threat. Part two of this paper examines socially responsible investing (SRI), a more passive form of shareholder engagement. Because the efficacy of SRI as a driver of corporate change has been questioned in previous research, the paper examines in depth if and how SRI can be supportive of the CSR movement, and how recent developments in the financial marketplace can strengthen the connection between SRI and CSR

Areas of Privacy in Facebook: Expectations and Value

Privacy issues surrounding the use of social media sites have been apparent over the past ten years. Use of such sites, particularly Facebook, has been increasing and recently business organizations have begun using Facebook as a means of connecting with potential customers or clients. This paper presents an empirical study of perceived privacy violations to examine factors that in!uence the expectations of privacy on Facebook. Results of the study suggest that the more important Facebook is to users, the more likely they are to perceive privacy violations and the more likely those violations are to be considered serious. Furthermore, how information is used is more important than the way this information is accessed

Conflict in Roles: Lying to the Ingroup Versus the Outgoing in Negotiations

This empirical study examines how group membership affects the likelihood of lies occurring in a two-person negotiation setting involving an experimental design with a repeated ultimatum bargaining. To better understand the reasoning of the negotiator in in-group and out-group bargaining exercises, the authors also examined perceptions of fairness in relation to offers for the in-group and out-group. The authors find that when negotiating, individuals tell lies of greater magnitude to out-group members than to ingroup members. In both situations, the magnitude of the initial lie predicts the likelihood that a concealment lie (i.e., another lie to conceal the initial lie) will be told. The study also finds that in negotiations with in-group members, the relationship between the initial lie and the concealment lie is moderated by the negotiator’s perceptions of unfair treatment toward the in-group bargaining partner. The authors assert that concealment lies with in-group members allow the individual to appear to maintain both the roles of a self-interested negotiator and a fair group member. The authors tested three hypotheses using a natural group of 42 undergraduate students who belonged to a sports team at a large Northeastern university. Implications for stakeholder research are addressed