Decoupling Among CSR Policies, Programs, and Impacts: An Empirical Study

Abstract

There are relatively few empirical studies on the impacts of corporate social responsibility (CSR) policies and programs. This article addresses the research gap by analyzing the incidence of, and the conditions that affect, decoupling (defined as divergence) among CSR policies, implementation of CSR programs, and CSR impacts for various environmental and social issues. Complete decoupling is a condition of full divergence among policies, programs, and impacts amounting to purely ceremonial CSR. Using ratings from a sustainability rating agency on a sample of about 1,000 large companies in 24 countries, the authors find empirical evidence not supporting a conclusion of complete decoupling. The empirical evidence suggests four levels of nondivergence in the sample. First, for most CSR issues examined, CSR policies of high quality (as measured by scope and level of detail) do have relatively strong effects on CSR implementation. Second, CSR programs of high quality (as measured by scope, the use of targets, and the use of strict deadlines) do have relatively strong effects on CSR impacts. Third, for most CSR issues, even low-quality CSR policies enforce the incidence and quality of programs in comparison with having no policy at all. Fourth, weak programs have more impact on the realization of CSR goals than having no program at all. The authors also find that the quality of CSR reporting (as measured by the implementation level of Global Reporting Initiative guidelines) and locating the responsibility for CSR at the board level reduce decoupling by strengthening the quality of CSR programs.