Faking or muddling through? understanding decoupling in response to stakeholder pressures

Most prior studies depict organizations as duplicitous, engaging in symbolic action when implementing socially mandated policy is costly and when stakeholders cannot monitor their practices. Yet, these studies overwhelmingly assume that the social norms of appropriate conduct are unambiguous and that managers have obvious interests in favour of, or against, implementing policy. We relax these assumptions, recognizing that stakeholders can vary in their expectations from corporations and that managers can perceive their interests in different ways. Based on a study of 12 corporations in six industries, and involving 270 interviews with managers and external stakeholders, we offer two distinct explanations for decoupling in the arena of CSR. In environments characterized by ambiguous social norms, decoupling allows corporations to engage in a problematic search for local solutions. In contrast, in environments characterized by certainty surrounding social expectations from corporations, the decisive influence on decoupling is how managers perceive their self-interest. Where managers frame CSR investments as means to reduce social risk, they are concerned with pragmatic legitimacy and support symbolic action. Taken together, these findings contribute to a micro-behavioural understanding of decoupling in institutional theory