Corporate Social and Financial Performance: An Integrative Review

During the last decade, organizations (especially large corporations) have been facing ever-increasing stakeholder pressure demanding ‘good corporate citizenship’ from business. This pressure means that, among other things, nonmarket strategies are increasingly important for effective executive decision making (Baron, 2006). Nonmarket strategies can be observed and measured in a wide variety of ways. However, as is evident from Part I, corporate social performance (CSP) can be regarded as a central outcome of business nonmarket strategies. For the purpose of the empirical analysis presented in this chapter, CSP is defined as ‘a business organization’s configuration of principles of social responsibility, processes of social responsiveness, and policies, programs, and observable outcomes as they relate to the firm’s societal relationships’ (Wood, 1991a, p. 693). This is the definition that Swanson elaborated upon in her remodeling of CSP in Chapters 1 and 2 (where she conveyed these concepts as a means-end continuum).