Unintended Effects of Corporate Social Responsibility on Corporate Reputation: When is Doing Good Not Good for Business?

Companies often consider corporate social responsibility as a means of contributing to the public good, while simultaneously improving their image and reputation among its stakeholders. While the literature is replete with examples of CSR leading to improved corporate reputation, there are some notable and striking exceptions. This study examines the unintended consequences of CSR and proffers three possible explanations for why corporate social responsibility sometimes leads to negative reputation targeting. A content analysis of purposively sampled Internet websites was conducted to empirically examine reputation targeting by certain outside influencer stakeholder groups toward the companies identified as the top 100 Corporate Citizens in 2006 by the journal Business Ethics. Multiple and simple regression analyses on the results supported basic CSR theory, that is, doing well by doing good. However, the results also revealed the unintended negative effects of CSR, and suggest that other motivations may be at play between corporations and their outside influencer stakeholders when it comes to socially responsible corporate behavior. The results also suggest that certain CSR strategies are more likely to bring on negative reputation targeting from the outside influencer groups than others. The study found that the CSR categories environment and product were significant explanatory variables for both positive and negative reputation targeting. The results also indicated that the top 100 companies tended to favor CSR strategies related to the community, and its internal stakeholders (diversity and employee relations), while the outside influencer groups tended to focus on CSR issues more closely associated with external stakeholders (\u27product, human rights, and environment). The significance of the productvariable suggests that companies should pay close attention to the quality of their products if they want to avoid negative reputation targeting campaigns. Another practical implication of the study pertains to environmental CSR strategies. The findings of the study suggest that companies which rely heavily on CSR strategies focusing on environmental issues, should be cognizant of the two edged sword attribute of the environment variable. It is in this realm that the unintended consequences of corporate social responsibility appear to be most evident