Table of Contents

1. Introduction
2. A Young Company’s CSR Motives
3. The Potential for Backfire
4. CSR Development: The Three Phases
5. A Mature Company’s CSR Motives
6. Vice Industries CRS Initiatives
7. Other Schools of Thought
8. Conclusion

1. Introduction Scholars explain the surprising fact that companies in the United States alone spend $9 billion annually on philanthropic causes by investigating the motives behind such apparent generosity (e.g. Cone et al., 2003). The critical importance of CSR derives from the fact that CSR practices have considerable influence on a company’s reputation and “the reputation of a firm is arguably the most valuable asset” (Peloza, 2006: 69). The term “corporate social responsibility,” or CSR, can be defined broadly as a firm’s charitable contributions and social initiatives, such as “philanthropy, cause-related marketing, environmental responsibility, and humane employee treatment, among others” (Ellen et al., 2006: 148). Researchers have found that over the past 30 years CSR correlated positively with corporate financial performance (CFP) (Orlitzky et al., 2003). “At its simplest, some argue that this ‘trend’ is purely self-serving marketing or philanthropy to offset concern over organizations’ increasing profit or corporate scandals.” (Brock, 2005: 58). By examining the motives behind CSR as purported by a broad spectrum of scholars, this paper will argue that companies initially implement CSR initiatives in an effort to increase sales and obtain other incremental benefits. Then, this paper will examine the role CSR plays within a company’s business system over an extended period of time, arguing that CSR initiatives can ultimately provide a company with insurance in the face of potentially damaging events. Finally, this paper will attempt to determine whether the