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A theoretical analysis of the relationship between social capital and corporate social responsibility: concepts and definitions

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  • Lorenzo Sacconi
  • Giacomo Degli Antoni

Abstract

The paper studies the relationship between social capital (SC) and Corporate Social Responsibility (CSR) by investigating the idea of a virtuous circle, between the level of SC and the implementation of CSR practices, that fosters socio-economic development by generating social inclusion and social networks based on trust and trustworthiness. Following the literature on SC that stresses its multidimensional character, both a cognitive and a structural idea of SC are considered. The first one essentially refers to the dispositional characters of agents that affect their propensity to behave in different ways. The latter refers to social networks connecting agents. With regard to the concept of CSR, a contractarian approach is adopted and CSR is considered as an extended model of corporate governance, based on the fiduciary duties owed to all the firm�s stakeholders. Among stakeholders, a original distinction between �strong� and �weak� stakeholders is introduced. The key element that allows to distinguish between strong and weak stakeholders concerns the consequences that the break in the relationship with the firm produces both on the stakeholder and on the firm. Both these two categories have made specific investments in the firm. However, strong stakeholders are precious for the firm because they bring in strategic assets. On the contrary, weak stakeholders do not bring strategic assets into the firm and firms have material incentives at defecting in the relationship with them. Considering the notions of cognitive and structural SC, a contractarian approach to CSR and the distinction between weak and strong stakeholders, the paper shows that: a) the level of cognitive SC plays a key role in inducing the firm to adopt and observe CSR practices that respect all the stakeholders; b) the decision of adopting formal instruments of CSR contributes to create cognitive SC that is endogenously determined in the model; c) the level of cognitive SC and the decision of adopting CSR practices creates structural SC in terms of a long term relationship between the firm and the weak and strong stakeholders.

Suggested Citation

  • Lorenzo Sacconi & Giacomo Degli Antoni, 2008. "A theoretical analysis of the relationship between social capital and corporate social responsibility: concepts and definitions," Department of Economics Working Papers 0813, Department of Economics, University of Trento, Italia.
    • Handle: RePEc:trn:utwpde:0813
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    References listed on IDEAS

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    1. Gianluca Grimalda & Lorenzo Sacconi, 2002. "The Constitution of the Nonprofit Enterprise: Ideals, Conformism and Reciprocity," LIUC Papers in Ethics, Law and Economics 115, Cattaneo University (LIUC).
    2. Hart, Oliver, 1995. "Firms, Contracts, and Financial Structure," OUP Catalogue, Oxford University Press, number 9780198288817.
    3. Lorenzo Sacconi, 2006. "A Social Contract Account for CSR as an Extended Model of Corporate Governance (I): Rational Bargaining and Justification," Journal of Business Ethics, Springer, vol. 68(3), pages 259-281, October.
    4. Lorenzo Sacconi, 2004. "Corporate social responsibility (CSR) as a model of "extended" corporate governance. an explanation based on the economic theories of social contract, reputation and reciprocal conformism," LIUC Papers in Ethics, Law and Economics 142, Cattaneo University (LIUC).
    5. Gianluca Grimalda & Lorenzo Sacconi, 2005. "The Constitution of the Not-For-Profit Organisation: Reciprocal Conformity to Morality," Constitutional Political Economy, Springer, vol. 16(3), pages 249-276, September.
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    Cited by:

    1. Jayashankar, Priyanka & Ashta, Arvind & Rasmussen, Mark, 2015. "Slow money in an age of fiduciary capitalism," Ecological Economics, Elsevier, vol. 116(C), pages 322-329.
    2. Sabatini, Fabio & Sarracino, Francesco, 2014. "E-participation: Social Capital and the Internet," Economy and Society 186606, Fondazione Eni Enrico Mattei (FEEM).
    3. Fabio Sabatini & Francesco Sarracino, 2013. "Will Facebook save or destroy social capital? An empirical investigation into the effect of online interactions on trust and networks," Department of Economics University of Siena 692, Department of Economics, University of Siena.
    4. Cornett, Marcia Millon & Minnick, Kristina & Schorno, Patrick J. & Tehranian, Hassan, 2021. "Bank consumer relations and social capital," Journal of Banking & Finance, Elsevier, vol. 133(C).
    5. Giacomo, Degli Antoni & Fabio, Sabatini, 2013. "Disentangling the relationship between nonprofit and social capital: the role of social cooperatives and social welfare associations in the development of networks of strong and weak ties," MPRA Paper 44860, University Library of Munich, Germany.
    6. Fabio Sabatini & Francesca Modena & Ermanno Tortia, 2014. "Do cooperative enterprises create social trust?," Small Business Economics, Springer, vol. 42(3), pages 621-641, March.
    7. Filippi, Maryline, 2021. "Do French agrifood co-ops have a head start in Corporate Social Responsibility? An initial examination of French co-ops and their practices," Review of Agricultural, Food and Environmental Studies, Institut National de la Recherche Agronomique (INRA), vol. 101(4), January.
    8. Lorenzo Sacconi, 2011. "Multi-stakeholder governance for effectively sharing social responsibility 1 (social contracts, deliberative democracy and endogenous conformity)," Econometica Working Papers wp26, Econometica.
    9. Fabio Sabatini & Francesco Sarracino, 2019. "Online Social Networks and Trust," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 142(1), pages 229-260, February.
    10. Lorenzo Sacconi, 2011. "A Rawlsian View of CSR and the Game Theory of its Implementation (III): Conformism, Equilibrium Refinement and Selection," Palgrave Macmillan Books, in: Lorenzo Sacconi & Giacomo Degli Antoni (ed.), Social Capital, Corporate Social Responsibility, Economic Behaviour and Performance, chapter 2, pages 42-79, Palgrave Macmillan.
    11. Riillo, Cesare Fabio Antonio & Sarracino, Francesco, 2014. "Motivations for Corporate Social Responsibility: all talk and no walk?," MPRA Paper 60211, University Library of Munich, Germany.
    12. Mei Peng Low, 2016. "Corporate Social Responsibility and the Evolution of Internal Corporate Social Responsibility in 21st CenturyOrganization Performance: A Case Study of Pakistan Telecommunication Authority," Asian Journal of Social Sciences and Management Studies, Asian Online Journal Publishing Group, vol. 3(1), pages 56-74.
    13. Liliya Nedkova Nedevа, 2021. "Social Capital Management In Municipality Enterprises," Economy & Business Journal, International Scientific Publications, Bulgaria, vol. 15(1), pages 364-373.

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    More about this item

    Keywords

    Social capital; Corporate Social Responsibility; Social network; Ideal utility; Cooperation; Trust.;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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