ABSTRACT
This chapter explores the drivers of Corporate Social Responsibility (CSR) and also the proximate factors that influence it, such as firm size, diversification and manager’s profile. The traditional, neo-classical view of a firm is that it is a profit ‘maximiser’ and therefore any activity that it undertakes must lead to increased profits. The Fairtrade mark designates products which have been ‘produced by small scale organisations or plantations that meet Fairtrade social, economic and environmental standards’. In the 1980s, public pressure forced McDonald’s to reduce its packaging and waste. Globalisation has decreased the time–space distance between countries and has led to increasing standardisation especially in business activities across the world. The impact of the event on the value of a company is measured so as to examine the CSR–financial performance relationship. Diversification is when a firm operates in multiple business areas for the purpose of reducing vulnerability to market competition, increasing growth and profitability, or seeking cooperation.
