The concept of corporate social performance has been around for several decades now, but the idea is still closely misinterpreted for corporate social responsibility, corporate social responsiveness, or any other approach relating to business and society. Although these concepts are closely related to each other, they each have unique connotations. These approaches also represent the various phases in our understanding of the relationship between a firm, or organization, and the environment, or the society, where the firm functions.
Corporate Social Performance Defined
As mentioned in the earlier paragraph, corporate social performance is confusingly equated with concepts connoting to business and the society such as corporate image, community relations, business ethics or what is called corporate social policy, and other related terms. To isolate the concept of CSP, it pertains to the outcomes or results to behavior and not to processes or structures. This definition was given by Wartick and Cochran to clearly explain the term “performance” in the said concept.
Moreover, in learning the study of corporate social performance (CSP), let us use the technical definition from Donna Wood’s way of understanding this approach. According to Wood, CSP is a configuration or a pattern of an organization’s beliefs on corporate social responsibility, social responsiveness, as well as the policies, regulations, and the outcomes as they connote to the relationship of the organization to the society as a whole.
Wood acknowledged the definition of Wartick and Cochran about CSP but she also stressed that CSP is not about the interaction and integration of business and society but it focuses on the results and outcomes. Every organization may be assessed on its social performance, and the outcome of the evaluation can either be positive or negative depending on the firm’s behavior and actions towards society.
Wood’s CSP Model
Basing from the definition of Wood on corporate social performance, she designed a CSP model that shows a related framework for business and society by incorporating or putting together the various concepts in the relationship of business and society.
The CSP model starts out with the basic understanding of the three principles of corporate social responsibility which are institutional, organizational, and individual principles. The first principle is legitimacy which states that the society allows legitimacy to business, so a firm must not abuse economic affluence. The second principle caters to public responsibility wherein businesses are accountable for the outcomes that involve the society. The third principle is about managerial discretion addressing managers as moral actors and important players in any socially responsible outcome.
The second phase of the CSP model demonstrates implementation of the stated principles through social responsiveness. It depicts the ability of an organization to act towards social pressures. There are three processes in corporate social responsiveness. The first process is called environmental assessment where an organization responds to certain conditions within the environment it operates. The second process is stakeholder management which comprises of company devices such as newsletters, community relations programs, and public affairs offices. The third process in this phase is issues management. It includes issues identification, analysis, and response.
The last level in the CSP model is the outcome of corporate social behavior which may create social impacts, lead to social programs, and social policies.
Wood’s model views the first level or the principles of corporate social responsibility as the basis or foundation of the processes, mechanisms, and outcomes of corporate social performance.
Swanson’s Reoriented CSP Model
There are three value processes that distinguish social processes in organizations in Diane Swanson’s reoriented CSP model. The first process is called economizing which pertains to the capacity of a business to create outputs competently through competitive behavior. The next value process is power seeking which refers to the self-centered behavior of an organization in gaining affluence through hierarchical process. The third process is ecologizing which is a symbiotic interrelation among organizations and their business environments using cooperative behavior to sustain life.
In Swanson’s model, the central point around which these value processes are focused on is decision-making. In contrast to Wood, Swanson’s concept on corporate social responsibility is not based on hierarchical principles. Additionally, her reoriented CSP model sees social processes as essentially and naturally ethical and compromising values in which personal values and behaviors create influence.