Social Responsibility and Small Business: Suggestions for Research

SOCIAL RESPONSIBILITY AND SMALL BUSINESS: SUGGESTIONS FOR RESEARCH Over the last three decades, managers and scholars have been searching for a better understanding of corporations' social responsibility, or the pros and cons of business involvement in resolving social problems (Bowen 1953, Friedman 1962, Heyne 1968, Levitt 1958). Carroll's (1979) construction of the four responsibilities (economic, legal, ethical, and descretionary) comprising a company's total concept of corporate social responsibility is useful for distinguishing between those responsibilities that are market or legally driven, and those that go beyond the law (Stone 1975). This quest has been quite fruitful in advancing the theory of corporate social responsibility (CSR) (Carroll 1979, Epstein 1987, Wartick and Cochran 1985). Nonetheless, there remains a visible gap between CSR theory and management practice that distresses many authorities (Jones 1980, 1983; Preston and Post 1975). This problem is exacerbated by limited informatioon on managing CSR in small businesses. Several factors have contributed to the shallow understanding of small business CSR. First, a distinct large-scale corporation orientation persists in the CSR literature (Chrisman and Archer 1984). Little research and discussion have focused on CSR in small (and medium-sized) businesses. Second, it has been proposed that small businesses lack sufficient influence or resources to adequately address social issues (Spencer and Heinze 1973). Third, small businesses have been encouraged to overlook social activism and to concentrate instead on avoiding irresponsible behavior (Van Auekn and Ireland 1982). The tenedency for CSR research to be conducted primarily in large-scale corporation ignores the fact that more than 60 percent of the U.S. work force is employed by companies with fewer than 50 employees (Trost 1988). Only 0.08 percent of all businesses employ 1,000 or more people; 95.3 percent of all businesses employ fewer than 50 people (U.S. Department of Commerce 1987). Consequently, when researchers examine CSR in large corporations their findings may not be generalizable to the most prevalent firms where most of the U.S. population works. The research emphasis on big business is detrimental to understanding CSR practices in small business issues. As a result, there are few theoretically or empirically based guideline upon which small business practictioners can draw in formulating CSR policies, objectives, or strategies. The advances made in CSR theory during the last 30 years are impressive. However, it is also very apparent that CSR is primarily understood from the perspective of large corporations (Fischer and Groeneveld 1976). Therefore, it is appropriate to ask what directions should be taken to reach a better understanding of CSR in small business. The big business orientation of previous CSR research limits its usefulness and applicability to the majority of businesses in the U.S. Further evoloution of theory and empirical research that includes small businesses would greatly enhance the usefulness of CSR concepts for practitioners. The purposes of this study are to: (1) review existing research to identify research-based inferences about small business CSR, (2) identify methodological problems and research gaps, and (3) propose a research agenda that will overcome these problems while leading to a more robust theory of CSR in small business. RESEARCH ON SMALL BUSINESS CSR The most notable characteristic of empirical research on CSR in small businesses is the limited number of studies. Table 1 provides a chromological overview of eight leading publications on small business CSR. Six of these articles were published in the American Journal of Small Business and the Journal of Small Business Management while the others were published in a book and conference proceedings. The small number of research studies was explicity acknowledged in 1984 (Chrisman and Archer 1984). …