CSR orientations as a guiding principle for innovativeness : a supply chain perspective

A central debate in literature today concerns the relationship between Corporate Social Responsibility (CSR) and firm competitiveness. We advance this debate by proposing a sense-and-response mechanism in which CSR acts as a strategic orientation for developing within firm capabilities, in particular innovativeness, to actually respond to societal needs. Departing from the resource-based view (RBV) we suggest that firms obtain competitiveness through both developing internal capabilities and leveraging capabilities from their suppliers. We examine CSR orientation and innovativeness along triads in a supply chain: a focal firm, a major supplier and a major customer. The results drawn from a survey of 88 of such matched triads suggest the following. Firstly, we find a positive relationship between CSR orientation and innovativeness, both within the focal firm and within the supplier. Secondly, customers value CSR orientation through CSR reputation. Moreover, customer satisfaction is a direct effect of a focal firm innovativeness, which in turn is driven by supplier innovativeness. Thirdly, the findings demonstrate a negative relationship between supplier CSR orientation and focal firm innovativeness. Consequently, in strategic supply management, enhancing a CSR-innovativeness mechanism at suppliers seems to be crucial in order to benefit from these valuable supplier capabilities