Business and Society Review 110:2 191– 212

Corporate Social
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Responsibility and Corporate

Citizenship: Towards
Corporate Accountability
CARMEN VALOR

INTRODUCTION

I
f you were a newcomer in the field of business and social issues
and you started browsing academic literature, surely you would
be bewildered by a number of different terms and definitions
that imply similar or identical meanings: corporate social responsi-
bility, public responsibility, corporate social responsibilities, corporate
societal responsibility, corporate social responsiveness, corporate
social performance, corporate citizenship, business citizenship,
stakeholding company, business ethics, sustainable company, and
triple bottom-line approach. Even the same author uses different
terms throughout his or her papers1 or in the same paper.2 You will
probably wonder whether historical and geographic reasons explain
the preference for a particular name (e.g., until the 1990s, the term
“corporate social responsibility” was more widely used; the use of
corporate citizenship is preferred in Anglo-Saxon countries3) or
whether academics, out of the need to present original contributions,
make up new names, and merely add nuances to past concepts.
This work is an attempt to analyze the similarities and differences
between two of the most recurrent terms used in the literature:
corporate social responsibility (CSR) and corporate citizenship (CC).
As some authors have highlighted, since the 1990s CC “started to

Carmen Valor is an associate teacher at Universidad San Pablo-CEU. This paper was written
during a research stay at University of Bath, UK.

© 2005 Center for Business Ethics at Bentley College. Published by Blackwell Publishing,
350 Main Street, Malden, MA 02148, USA, and 9600 Garsington Road, Oxford OX4 2DQ, UK.
192 BUSINESS AND SOCIETY REVIEW

compete and replace the other concept in the realms of manage-

ment theory and practice.”4 To explore this “competition” between
terminology and concepts, the criterion “which one(s) is improving
corporate accountability” will be used. The question of corporate
accountability seems crucial today. Corporations have been acquir-
ing increasing power, in certain cases, even more power than some
states, without engaging in the advancement of the common good.5
The situation presented by several authors6—the growth of truly
global companies, the environmental damage, the “race to the
bottom” in labor, environmental and welfare standards, the over-
commercialization of culture, and moral values—has inflamed the
debate on the control of corporations.
This paper is structured as follows: The first section reviews the
history of each term and analyzes the similarities and differences
between these two concepts. The second section explores the first
condition for improving accountability (changes in the system), its
outcomes and limitations. The third section presents the second
necessary condition that may overcome these limitations (a system
change). The role that these concepts play in fostering each of these
conditions will also be highlighted.

ANALYSIS OF CORPORATE SOCIAL RESPONSIBILITY

AND CORPORATE CITIZENSHIP

The CSR originated in 19537 with the publication of Bowen’s book

Social Responsibilities of Businessmen. At this time, the emphasis is
placed on businesspeople’s social conscience, rather than on the
company itself. The managerial “revolution”8 and the growing
hostility of the public—who, after experiencing increasing social
problems, demanded changes in business9—led to a shift in the
focus. Most of the responsibilities mentioned in the literature
(which coincided essentially with the public’s demands) were incor-
porated into regulation, giving rise to a new approach: the public
policy approach.10 The concept then became clear: companies have
to abide by the law. However, the debate about CSR continued.
Complying with the legal requirements did not seem enough, partly
because not all the public’s demands were protected by laws, and
partly because CSR was favored as it was believed to overcome the
inefficiencies derived from regulation.11 The CSR positioned itself as
CARMEN VALOR 193

a challenge to the neoclassical business model that, at that time,

began becoming a paradigm. Two other terms were used in the
1970s: corporate social responsiveness and corporate social perfor-
mance. The first emphasized the proactive approach required from
companies and was used to link CSR with strategic management;12
the second was an attempt to offer a managerial framework to deal
with the CSR13 and simultaneously, an attempt to measure CSR.14
In the 1980s, the concept of stakeholders was coined. Although
older references to the same concept have been found, it was Free-
man’s landmark book that triggered the thinking around stake-
holders. Originally defined in a Stanford Research Institute Internal
Report (1963) as “those groups without whose support an organiza-
tion would cease to exist,”15 Freeman extended the scope by pro-
posing the following definition: “any group or individual who can
affect or is affected by the achievement of the organization’s objec-
tives.”16 The term proved to be useful as more than 200 theoretical
papers have been written about stakeholders.17 The CSR and the
concept of stakeholders complement and reinforce each other.
In the late 1990s, practitioners coined a new term: corporate
citizenship (CC).18 The term CC is used to “connect business activity to
broader social accountability and service for mutual benefit,” re-
inforcing the view that a corporation is an entity with status equiva-
lent to a person.19 The CC also coexists with and draws on existing
literature on stakeholders.
These two concepts have been criticized for a number of reasons.
A review of these criticisms may clarify similarities and differences
between these concepts. Moreover, it will establish the basis for the
subsequent discussion regarding their contribution in improving
corporate accountability.
The CSR has been used as an umbrella concept to introduce a
large number of ideas, concepts, and techniques.20 Nonetheless,
the principle that companies must not only be concerned about
profits and economic performance underlies all of them. The CC
advocates have pointed out some flaws in the CSR concept. Before
the notion of CC appeared, some of these criticisms had already
been mentioned, namely the lack of a single and clear definition of
CSR21 and the large number of different proposals of “responsibili-
ties.”22 Besides, CSR has been criticized because of (1) its narrow
content (the concept has been articulated more as management of
externalities than as “holistic criteria in comprehensively redefining
194 BUSINESS AND SOCIETY REVIEW

an organization internally”);23 (2) its broad content;24 (3) its aca-

demic origin;25 (4) the difficulties to operationalize CSR;26 and (5)
the potential to bias its content towards specific interests.27 In addi-
tion, CSR was further criticized by neoclassical proponents28 who
regarded it as “subversive,” as an attack to property rights, and, in
general, as a threat to free society.
Some counterarguments may be offered to these criticisms.
Against the lack of clarity of the concept and its contents, it may be
argued that this is inherent in the concept of CSR. The CSR makes
reference to a relative concept; social demands vary in time and space
and even within the same group of stakeholders (e.g., employees).
Therefore, there will always be some ambiguity in the concept. This
counterargument also helps to explain the difficulties in operation-
alizing the concept: CSR has to be specified in each company, taking
into account its changing environment. It is not easy to provide
managers with rules of thumb as evidence shows that social demands
change in every society.29 Nonetheless, a number of operational models
surged from the concept of CSR: standards (e.g., Sullivan Principles)
and theoretical models (e.g., European Union’s Green Paper).
The criticism regarding the academic origin of CSR is not entirely
valid. The CSR has been developed by academics, trying to system-
atize actual social demands.30 Simultaneously, their conceptual
models were used by social movements to support their claims
(e.g., Ralph Nader’s Corporate Social Responsibility Project).31 Hence,
CSR has had both a bottom-up origin and a top-down development.
Although CSR has been criticized for its focus on externalities,
this approach is consistent with the neoclassical paradigm of
the firm. It has been widely used to persuade managers to take into
account the social side effects of their policies. Profits lose their
capacity to measure performance when in their computation and
externalities have not been taken into account.32 To some extent,
developments in the measurement of intangible assets (e.g., corpo-
rate reputation) and the inclusion of social and environmental
performance in risk management33 try to capture these positive and
negative externalities. Besides, it is not clear why companies are
demanded to go beyond the management of externalities. When
some firms do not even comply with the existing regulation, one
may well wonder if they are ready to make the next step. Finally,
several counterarguments have been advanced against those who
reject CSR altogether.34
CARMEN VALOR 195

The main criticism of CSR applies to CC as well: the ambiguity

of the concept.35 Different from CSR, CC is a term coined by
practitioners36 who regard it as more positive than CSR.37 The CC
advocates also believe that this term overcomes the difficulties of
operationalization and implementation found in CSR by integrating
previous concepts: “It may arguably serve to integrate corporate
social responsibility and stakeholder management within a corpo-
rate social performance framework.”38 Nonetheless, they do not offer
any evidence to support this arguable advantage. Other authors do
not seem to think that CC integrates CSR per se and propose other
models to merge both concepts.39
The definition of CC is not clear in the literature. In a recent
paper, Matten and colleagues40 explain that three visions underlie
the label “corporate citizenship”: “a limited view” that equates CC
with philanthropy or community involvement; “the equivalent view”
that equates CC with CSR; and “the extended view,” according to
which CC implies “a reconceptualization of business–society rela-
tions.” It is the meaning conveyed in citizenship that makes this term
more desirable. It clarifies its content, because it is easy for com-
panies to derive what society demands, from the shared portrayal of
the “individual good citizen.” However, evidence shows that managers
are still confused about what “corporate citizenship” means.41
In addition, “corporate citizenship” emphasizes the idea that cor-
porations have rights and duties. However, because these rights are
not equal to those of a “real” citizen, some authors argue that CC is
a “fictional concept.”42 Yet, the aim of CC is to highlight that firms
are “public powerful actors, which have a responsibility to respect
those real citizens’ rights in society”;43 this will eventually lead
companies to take over those “unserved governmental functions
that were the result of a cutback in social rights two decades ago,
but also protecting civil and political rights.”44 Again, it is difficult to
find in the literature any evidence backing the posited effects on
corporate behavior that would derive from this new theoretical
concept. Moreover, some authors45 argue that the use of the term
“corporate citizenship” adds to the confusion between NGOs or civil
society organizations (CSOs) and BINGOs (transnational corpora-
tion and business NGOs); on the grounds that they are also citizens,
companies present themselves in a number of instances as NGOs
and attempt to take part in regulation (or deregulation according to
this researcher). Richter46 denounces the risks of this approach,
196 BUSINESS AND SOCIETY REVIEW

while stating that corporations are not citizens but “legal entities
entitled to carry out profit-making activities as long as they
fulfil certain social obligations. Corporate rights are a contractual
arrangement with society that can be taken away if corporations do
not behave responsibly.”
Finally, some scholars argue that CC should be defined as
“understanding and managing company’s wider influences on the
society for the benefit of the company and the society as a whole.”47
The argument that CC has made virtue a necessity and turned this
necessity into strategic advantage48 had already been advanced
under the CSR debate49 and the theory of the stakeholders.50 Hence,
it is not original with the CC concept. It is worth noting that, in con-
trast to CSR, neoclassical proponents have not rejected the notion
of CC. This could be explained by two reasons: first, the concept
of CC has “watered down” the requirements encapsulated in the
concept of CSR; therefore, it is no longer perceived as a threat to
the “neoclassical orthodoxy”; second, by the 1990s managers were
already convinced that a certain degree of “social embeddedness”
was desirable and necessary.

DEFINITION OF ACCOUNTABILITY

The previous analysis shows that CSR and CC have more in com-
mon than proponents of CC seem to acknowledge. As explained in
the introduction, this work will analyze which of them has proved to
be effective in improving accountability. Few definitions of corpo-
rate accountability have been found in the literature on CSR/CC,
even in those papers addressing specifically the issue of corporate
accountability.51 Drawing on the literature on political account-
ability, corporate accountability could be understood as corporate
control; that is, the establishment of clear means for sanctioning
failure.52
Both CSR and CC propose that firms should be controlled by
society and not only by shareholders. When authors mention
the “principle of neighbor of choice” or the “license to operate,”53 they
acknowledge that society should be conferred clear means for
sanctioning corporate failure. These concepts reject the neoclassi-
cal vision of corporate accountability (i.e., companies should be
accountable only to shareholders, as they are the legitimate owners
of the firm).54 By claiming that companies are accountable for the
CARMEN VALOR 197

creation of organizational wealth for its multiple constituents,55

these concepts oppose the neoclassical notion of shareholders as
the only legitimate agent to sanction corporate results. Therefore,
accountability should be understood as social corporate control.
This work does not attempt to discuss whether this social control
of companies is morally sound or technically correct. This aims
to clarify whether these concepts have provided society with the
means for choosing their companies and sanctioning corporate
failure (i.e., the conditions for this social control of companies).

THE FIRST CONDITION FOR ACCOUNTABILITY:

CHANGES IN THE SYSTEM

Under the current neoclassical paradigm, where corporate control

by society can only occur through the market, it may be evident that
none of these concepts helps to improve corporate accountability,
unless they are accompanied by real direct pressure on companies.
Under the neoclassical paradigm, the only means for sanctioning
failure is the market. As Sternberg56 puts it, “if individuals have
views as to how business should be conducted, they should ensure
that their individual choices accurately reflect those views. When
each potential stakeholder—otherwise known as every member of
society—acts conscientiously in his personal capacity, and strategi-
cally bestows or withholds its economic support on the basis of its
moral values, then the operation of market forces will automatically
lead business to reflect those values.”
Therefore, it would be the stakeholders themselves that bring
about changes in corporate practices by incorporating their ethical
values in their economic decisions, not any socioeconomic theory
such as CSR or CC. The first condition for accountability is that
individuals incorporate their moral values into their economic deci-
sions. Only when values change at the bottom of society and are
incorporated into economic decisions will companies change their
behavior to reflect these social values. This condition has also been
suggested by other scholars. For instance, Marsden and Andrioff
use the term social competition, which is analogous to market
competition, to explain the same idea. According to them, social
competition is necessary because “any powerful organization needs
effective countervailing power to keep them performing effectively
for their own benefit as well as that of wider society.”57
198 BUSINESS AND SOCIETY REVIEW

This condition is achieved in certain cultural contexts. Research

in certain Western countries evidences that individuals are showing
their interest in social performance in every one of the three mar-
kets where firms compete: product,58 capital,59 and labor markets.60
The incorporation of social values in the capital market, through
the socially responsible investments (SRI), is particularly signifi-
cant because under the neoclassical paradigm, it is precisely the
stockholders who are the most legitimate actor to sanction failure
and demand transparency. The impact of the SRI on financial
markets, combined with shareholder activism, has led to changes
in business practices61 and to the creation of ethical indexes (e.g.,
Dow Jones’ sustainability index, FTSE4Good, and KLD social index).62
In Spain, a recent work63 showed that the urge to be listed in ethical
indexes has led some of the largest listed companies to disclose
social and environmental information and to include social issues
as part of their strategic goals and plans. Therefore, these indexes have
achieved more regarding transparency and changes in corporate
behavior in two years than has the 30 years of the CSR/CC debate.
As previously mentioned, these concepts have successfully
brought changes in the system, by raising awareness among con-
sumers, investors, and employees. The body of literature around
these issues has helped understand and reinforce the “market
forces” that some scholars deemed crucial for the development of a
corporate social conscience,64

To the extent that CSR/CC have simultaneously reflected

social claims and reinforced the social movements’ demands,
by developing theoretical models they have helped improve
social control of companies.

Hence, stakeholders are putting pressure on companies. Yet,

despite the continuous societal demands for corporate change,
“[Companies] are likely to fulfill their responsibility in a minimalist
and fragmented fashion.”65 Why is that so? First, it is important
to highlight that citizens are reflecting their moral values in their
economic decisions only to a limited extent. The SRI volume is
relatively small compared to the total value of market trans-
actions.66 Empirical evidence about the influence of social issues on
consumers’ decisions67 shows that consumers seem to be “selec-
tively ethical” and do not regularly use social criteria in their pur-
chase decisions. Yet, research also shows that investors do not
know the existing offer of ethical investment products,68 that they
CARMEN VALOR 199

do not have enough information about the ethical and social beha-
vior of companies,69 or that consumers are willing to acquire ethical
products (i.e., fair trade) but they simply cannot afford them.70
Therefore, Sterberg’s statement that social demands should be
embodied in economic decisions assumes that certain circum-
stances concur. These circumstances have hardly ever proved to be
true in practice (e.g., perfect information, stakeholders as utterly
free and rational, perfect independence between stakeholders and
companies, no imbalance of power between a firm and its constitu-
ents, and enough availability of options to choose from). Likewise,
Smith71 points out that these two conditions for consumer pressure
are rarely found: highly competitive markets and information about
the social and ethical performance of companies. Regarding NGOs,
it has been highlighted that they need to “have access to a free and
broadly sympathetic press.”72 Some authors have argued that the
current ownership structures of mass media prevents this free
access; or worse, it may even result in a true censorship of news
reports denouncing corporations.73
The second reason for the limited ability of CSR/CC to improve
corporate accountability is that the discourse on CSR/CC has been
incorporated in the neoclassical model of the firm without changing
the aims and features of the latter. Thus, the contribution of CSR/
CC is just the reminder that certain social constraints should be
managed in order to increase corporate profits. Social and environ-
mental performances are not seen as an end in themselves but as a
source of competitive advantage or a condition to be competitive.
Hence, it seems that the neoclassical model of corporate control
remains untouched: companies should create value mostly for
shareholders because they are the only or most legitimate agent for
sanctioning failure.
This stance has led to the situation described as “managerial
capture”: the “potential for management to take control of the whole
process (including the degree of stakeholders’ inclusion) by strate-
gically collecting and disseminating only the information it deems
appropriate to advance corporate image.”74 Empirical75 evidence
supports the existence of “managerial capture.” For instance, the
aforementioned study of Spanish multinational companies showed
that companies were only undertaking the projects poorly rated by
ethical index managers in order to succeed in being listed in them,
without engaging in any process of dialogue with their actual stake-
holders to find out their demands.76 In a detailed case analysis of
200 BUSINESS AND SOCIETY REVIEW

the baby infant formula issue, Richter77 shows how companies have
tried to resist stakeholders’ pressure by denying, ignoring, or mini-
mizing their claims; at the root of their reaction lies their reluctance
to make any trade-off between profits and the common good. A
recent report of Christian Aid78 also shows that CSR/CC is used as
a means to campaign against environmental and human rights
regulations and in some cases, corporate social statements are
mere PR exercises. Likewise, other authors79 have strongly criticized
the existing business-led associations for the promotion of sustain-
able development, arguing that, at most, they attempt to reconcile
the traditional business model with limited social performance. In
the worst cases, they also try to resist regulation, shape the policy
agenda, and prevent the development of sustainability.
This tendency to “managerial capture” may have been aggravated
by the propensity of justifying CSR/CC on instrumental grounds.80
CSR/CC has been justified on the grounds that it will help advance
corporate goals, by showing that “doing good leads to do well,” or by
trying to prove that doing good does not prevent from doing well.81
This reductio ad economics82—albeit well intentioned, driven by the
need for pragmatism—has not helped to promote the social control
of companies. Encouraging managers to take into account the
social dimension of their decisions solely because it increases
profits leaves “promoters” without arguments when a decision does
not increase profits, despite being perceived as the right thing to do.
Alternatively, the right thing to do may be distorted so that it does
not clash with the objective of profits growth, as happened in the
case of the baby formula reported by Richter. As some authors have
pointed out, evidence shows that it is problematic to argue the
view that a socially responsible company “is necessarily a more
profitable business model.”83
Therefore, these concepts have negatively contributed to the
goal of social control when they present an enlightened version of
the neoclassical model. This enlightened version reinforces the
ownership model of the firm;84 therefore, it does not provide society
with means for sanctioning corporate failure.
To the extent that proponents of these concepts present an
instrumental orientation, arguing that social demands are a
constraint to achieving the objective of profits maximization,
they have “fouled their own nest,” favoring managerial capture
and helping little in improving social control of companies.
CARMEN VALOR 201

THE SECOND CONDITION FOR ACCOUNTABILITY:

A SYSTEM CHANGE

Together with pressure from the changes in the system (citizens

incorporating social concerns in their economic decisions), there is
a second necessary condition for the social control of companies.
Several authors85 have argued that there is a need for a system or a
paradigm change in order to solve the problem of accountability.
Although each of them justifies their proposal on different grounds
(e.g., a revision of the theory of property, the agency theory, or the
social contract), they all suggest that companies must convince
themselves that the rival theory to CSR/CC, the neoclassical ortho-
doxy, “is morally untenable.”86 Profits are not an end per se; they
must be compatible with other social needs. As Donaldson and
Preston stated, companies must acknowledge that the interests of
stakeholders are of intrinsic value and should behave accordingly.87
Companies must advance the common good or their license to
operate must be removed.
This change of system should permeate every sphere of activity
in human society: civil society, economic/business, and especially
the government/political.88 As Peter Utting, coordinator of the United
Nations Research Institute for Social Development (UNRISD) Project
on Business Responsibility for Sustainable Development, explains,
“progress associated with corporate social and environmental
responsibilities has been driven . . . by state regulation, collective
bargaining, and civil society activism.”89 Regulation should provide
citizens with the necessary rules to correct companies’ failure, a
requirement for the advancement of the common good. Leaving cor-
porate control in the hands of the market is a political decision that
could be reversed, and should be reversed when evidence shows
that markets are not successfully changing corporate practices.
Regulators should provide citizens with political mechanisms
to control firms, because these political means would complement and
overcome the flaws of the economic mechanisms consumers can
resort to. In some countries, these political means have been awarded
to control relationships based on contracts (e.g., employees–firm,
consumers–firm, and suppliers–firm). However, other relationships
stemming from an unclear, ill-defined contract (e.g., society–firm,
environment–firm, and population in other countries–firm) have not
been introduced into the corporate law. It is in these cases where citizens
202 BUSINESS AND SOCIETY REVIEW

are unprotected, having no political means to pass their demands to

companies. Therefore, to improve corporate accountability, it is neces-
sary to provide stakeholders with mechanisms for seeking redress.90
Actually, this call for a change in regulation does not imply a
radical novelty: different examples of this embeddedness existed in
the past91 and contemporary examples can be found in non-Anglo-
Saxon countries (e.g., Germany and the dual corporate board is a
political option to ensure that citizens’ views are taken into account
by managers). In some countries such as Spain, it is clearly stated
in the Charter that the common good will be favored over particular
interests, especially property rights (art. 128.1). However, this prin-
ciple has not been included in the corporate law.
More recently, global and supraregional institutions (e.g., UN or
OECD) have launched guidelines fostering social and environmental
concern among companies. Nevertheless, nation-states have
not incorporated these guidelines in their regulatory frameworks,
impeding their enforcement.92 Certain governments (e.g., Belgium,
Germany, and the United Kingdom) have approved laws improving
transparency in social issues, but disclosure of social and environ-
mental performances are required by law in few countries (e.g.,
France and South Africa). The enforcement of social and environ-
mental disclosure is, however, coherent with the neoclassical
paradigm, as perfect information is one of the requirements for the
adequate functioning of markets. Besides, regulators do not pro-
vide specific, strong, and effective measures to impose sanctions on
companies failing to show good levels of social, environmental, and
economic performance either in the territory where the company
has its headquarters or in other countries.93
Without a minimum regulatory framework enforcing disclosure
of such performance, stakeholders can only show their preference
for social and environmental performances to a limited extent. Yet,
regulators should go beyond that: they should impose certain levels
of social embeddedness on companies, giving citizens the means
to claim the enforcement of this regulation. Besides, this change of
system should be accepted by managers. They have to believe that
social embeddedness is morally sound and the legitimate alter-
native to the neoclassical orthodoxy. In fact, it is not that all managers
have adopted a neoclassical mindset. As Zadek remarks, there are
many managers committed to “improving the social and environ-
mental footprint of the companies where they work.”94
CARMEN VALOR 203

The system change cannot take place unless the first condition is
met. Companies reflect the values of the societies where they oper-
ate (although they also try to shape these values). It is pointless to
argue for the need of a new paradigm when financial markets (in the
end, individual investors) keep demanding profitability and growth
rates that may only be achieved by trading off social and environ-
mental performances. Therefore, this system change should be
adopted by civil society.
These concepts will therefore help advance corporate account-
ability when they are grounded in a normative orientation. Yet,
this normative orientation is absent from the discourse on CC.95
Therefore, the concept of CSR presents greater advantages to
advancing the social control of corporations.
To the extent that these concepts are defined and articulated
with a normative aim, positioning them as a challenge to the neo-
classical orthodoxy will help advance the necessary system change.
Because the concept of CC has not embraced this normative
orientation, the concept of CSR is superior to that of CC. Exploring
and spreading the normative basis for CSR will help achieve the
social control of corporations.
The following figure summarizes the main thesis of the present paper.

FIGURE 1 A Graphical Summary of the Arguments

CONCLUSIONS

This paper has analyzed similarities and differences between two of

the most recurrent terms used in the literature, corporate social
responsibility (CSR) and corporate citizenship (CC), using the ques-
tion of which one is advancing the social control of companies as
204 BUSINESS AND SOCIETY REVIEW

the key criterion. From a theoretical point of view, the two concepts
analyzed here have few differences. Both concepts have been criti-
cized for the same reasons. Proponents of “corporate citizenship,”
who usually argue that this concept would overcome the limitations
of the CSR concept, have not been able to provide a clear definition
of the concept or to demonstrate the posited advantages of using
the term “corporate citizenship.”
There are two conditions for the advancement of the social con-
trol of companies. First is the stakeholders’ pressure through their
economic decisions. Companies will only incorporate social and
environmental objectives in their agenda when economic agents
show that they also seek these values by incorporating them into
their economic decisions. Both concepts have fostered this pressure
to the extent that these theoretical developments have reflected and
reinforced social movements, demanding a higher degree of social
embeddedness from companies.
However, stakeholders have incorporated ethical values in their
economic decisions only partially and selectively. In addition, even
in those cases, when stakeholders have made it clear that compa-
nies must achieve social and environmental performances, manag-
ers have shown their reluctance to sacrifice profits in favor of the
common good. This reluctance, labeled as “managerial capture,”
has turned the discourse of CSR/CC into PR exercises rather than
endeavouring to rethink and reshape corporate internal manage-
ment, which is usually a more difficult task to accept and tackle.
The risk of managerial capture may have been aggravated by
the tendency of justifying CSR/CC on economic grounds. This
instrumental vision of these concepts has helped little in improving
the social control of companies.
The risk of managerial capture and the fact that consumer views
are not always incorporated into their market decisions, due to
external constraints, and the risk of managerial capture demand
a second condition to ensure corporate accountability: a system
change. To put it in a nutshell, this change implies accepting that
the common good is more important than the right to receive a
dividend, and that social and environmental performance must be
balanced with economic performance. This paradigm of the firm
should be adopted by economic agents (especially shareholders), by
managers, and by regulators. Regulation should provide citizens
with political means to sanction corporate social and environmental
failure.
CARMEN VALOR 205

When these concepts are presented with a normative aim, they

support this change of paradigm. However, CC has rarely been orient-
ed by this normative aim. Hence, CSR presents more advantages
to advancing the social control of companies and should be consid-
ered a superior theory vis-à-vis achieving social control of companies.
By exploring and spreading the normative basis for CSR, a system
change will be achieved.

ACKNOWLEDGMENTS

This research has been supported by the Ministerio de Educación,

Cultura y Deporte (Spain) through the grants FPU (2003). I am
grateful to Dr. Jones and Jackob Utgaard (University of Bath) for
their useful comments.

NOTES
1. For instance, I. Maignan and D. A. Ralston, “Corporate Social
Responsibility in Europe and the U.S.: Insights from Business’ Self-
Presentations,” Journal of International Business Studies 33, 3 (2002): 497–
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Countries: The Case of the United States and France,” Journal of Business
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