Toward a View of Complementarity: Trust and Policy Influence Effects of Corporate Social Responsibility and Corporate Political Activity

Toward a View of Complementarity: Trust and Policy Influence Effects of Corporate Social Responsibility and Corporate Political Activity

- Tahiru Azaaviele Liedong, Abby Ghobadian, Tazeeb Rajwani, and Nicholas O’Regan (2015)

The authors, through this article, provide a thorough examination of strategies that can enhance competitive advantage in a business. The article reasons that nonmarket strategies can be useful for businesses in order to gain competitive edge. The Article additionally presents an analysis on an unclear mechanism through which compelling nonmarket strategies can give rise to the accomplishment of an organization. With a specific end goal to exhibit the analysis to address the uncertain mechanism, the authors consider the part trust plays in the accomplishment of nonmarket strategies and the probable synergies between the two key segments of nonmarket strategies which are Corporate Social Responsibility (CSR) and Corporate Political Activity (CPA).

Since government is a fundamental element of the non-market strategy, the article mainly focusses on government and its various policies. To outline the part of trust in connection between CSR, CPA, and policy impact, the authors constructed a conceptual model. The model abstracts trust with three parameters – ability, integrity, and benevolence, and contends that each of the three parameters must be available amongst firms and the polity if the organizations are to prevail with regards to influencing policy (Mayer et al., 1995). The authors also argue that in order to create strong trust, both the strategies (CSR and CPA) should have all the three parameters, which is not the case in reality. While both the strategies have integrity in like manner, CSR has benevolence while CPA has policy skills and ability. On combining both the strategies, CPA and CSR encourage solid trust, make access to the polity, decrease voter resistance to corporate political exercises, and empower broad policy issues (Liedong et al., 2015).

After having provided significant backing to the topic and through extensive research, models and examinations, Hond et al (2014), analysis of the nonmarket strategy model states that, whenever CPA and CSR are aligned, it creates additional value and the synergies that arise are probably going to have less limitations as compared to when CPA and CSR are not aligned or are misaligned (Hond et al., 2014). Similarly, in their study of lobbying efforts for social causes, Peterson and Pfitzer (2009), brought up that the organizations that align their nonmarket strategies (CPA and CSR) might probably witness an expansion in the positive reputation impacts from CSR. Any negative