A Theoretical Analysis of the Relationship between Social Capital and Corporate Social Responsibility: Concepts and Definitions

Abstract

It is possible to identify two principal approaches to SC: social capital in terms of generalised trust or civic norms (e.g.Putnam et al. 1993 andKnack and Keefer 1997) and in terms of social networks (e.g.Coleman 1988;Lin 2001; Burt 2002).promoting the coordination processes between firm and stakeholders that are essential in order to implement the CSR practices 3 .Even though SC and CSR seem to be linked by many common elements related to the quality and quantity of social relations between agents, their relationship has not been deeply investigated yet.This paper is aimed at shedding light on some aspects of this relationship, in particular, by investigating the idea of a virtuous circle, between the level of SC and the implementation of CSR practices, that fosters socio-economic development by generating social inclusion and social networks based on trust and trustworthiness.Following the literature on SC that stresses its multidimensional character (e.g.Paldam 2000), we consider two dimensions of this notion.Starting from the distinction introduced by Uphoff (1999), we take into account a cognitive and a structural idea of SC.The first one essentially refers to the dispositional characters of agents that affect their propensity to behave in different ways.The latter refers to social networks connecting agents.With regard to the concept of CSR, we adopt a contractarian approach and consider CSR as an extended model of corporate governance, based on the fiduciary duties owed ,#) (22) ,50) 1%"-=s stakeholders (Sacconi 2006; 2007a).Among stakeholders, we distinguish :0,>00&)7strong<)(&.)7>0(?<)3,(?05#2.0"3@)Boththese two categories have made specific investments in the firm.However, strong stakeholders are precious for the firm because they bring in strategic assets.They are, for example, skilled workers or institutional investors.On the contrary, weak stakeholders do not bring strategic assets into the firm and firms have material incentives at defecting in the relationship with them.They are, for example, unskilled workers.Considering the notions of cognitive and structural SC and a contractarian approach to CSR, we show that: 3 These relational elements related to the networks among firms and stakeholders are indubitably less important with regard to the implementation of CSR practices if one considers other approaches to CSR.This is the case, for example, of the approaches by Friedman (1977) and Jensen (2001).Both these authors do not give much room to the explicit consideration of the 3,(?05#2.0"=sinterests by the owners of firms (see section 3).

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