Meeting the competing goals of CSR: exploring the potential of value diversity in teams

Ranganathan, Ramya (2010) Meeting the competing goals of CSR: exploring the potential of value diversity in teams. Doctoral thesis, University of London: London Business School.

Abstract

A key theme that underlies much of the controversy around Corporate Social Responsibility (CSR) is the underlying tension between a firm's interest in wealth generation and its interest in social development. In this research, I view the problem from a psychological viewpoint, and note that top managers are confronted with the tension between the firm's social mission and financial mission at a very personal level where their motivation to pursue each of these goals is influenced by their inherent personal values. Specifically, I examine how value (social and wealth) diversity in a top management team might aid or hinder the team in its attempt to find integrative solutions that meet both the competing goals of wealth creation and social impact. In this research, I theorize about a few different effects of value diversity on the workings of a top management team (in the context of working on a CSR problem), and then combine these effects to predict an "inverted-U" shaped relationship between value diversity and the likelihood of finding an integratively complex CSR solution. I refine and test my theory through a multi-method exploration that includes field interviews, an online CSR experiment with 219 participants (MBA students), and 65 simulation top management teams (TMTs) with MBA students. I find that there exists an asymmetry between values associated with social impact and values associated with wealth generation, such that not only are the former are more stable than the latter, but also, social values have a bi-directional influence: leading to both a preference for pro-social approaches as well as the opposition of profits-only approaches, while the wealth values show only a preference effect. I find support for the inverted-U relationship between value diversity and integratively complex solutions, but only for social value diversity and not for wealth related value diversity. I discuss the contributions of these findings for theory and practice and suggest directions for future research.