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Market-Based Solutions to Vital Economic Issues


Accelerating progress in social and environmental sustainability
Dec 22, 2018

Microfoundations of Corporate Social Responsibility and Irresponsibility


This study examines the importance of social perception of corporate social responsibility (CSR) and irresponsibility (CSI). Drawing from the social psychology literature on stereotypes, we argue that two fundamental dimensions of social perception—warmth and competence—help understand the underlying processes and conditions under which CSR leads to specific outcomes. We propose that firms engaging in CSR are perceived as higher in warmth and, by default, competence; moreover, different perceptions of warmth and competence of the organization can moderate CSR rewards and CSI penalties. To demonstrate this, we conduct three experiments. Experiment 1 links CSR with perceptions of warmth and competence, and shows that warmth perceptions mediate the relationship between CSR and important outcomes, such as purchase intentions and reputation. Experiment 2 adds information on firms’ countries of origin to show that CSR rewards and CSI penalties differ depending on the (mis)alignment of CSR strategy with country stereotypes. Finally, Experiment 3 replicates these findings using behavioral paradigms. We find that firms from high-warmth countries (USA, Sweden, Portugal) receive lower CSR rewards and pay higher CSI penalties than firms from low-warmth countries (Germany, Pakistan) but this effect is moderated by competence. Our micro-macro study advances social evaluation, strategic CSR, and international management literatures.

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