Corporate Social Counterpositioning: How Attributes of Social Issues Influence Competitive Response

66 Pages Posted: 7 Feb 2019 Last revised: 24 Apr 2021

See all articles by Aharon Mohliver

Aharon Mohliver

London Business School - Department of Strategy & Entrepreneurship

Donal Crilly

London Business School - Department of Strategic & International Management

Aseem Kaul

University of Minnesota - Minneapolis

Date Written: April 5, 2021

Abstract

We develop a theory of how firms respond to each other’s CSR activities. We contend that whether a firm will emulate, ignore, or oppose a rival’s CSR efforts depends on attributes of the underlying social issue, the level of market competition, and the substantiveness of CSR. We develop a formal model of CSR as a function of these factors, allowing, in particular, for issues to be socially polarizing. The model predicts several distinct equilibrium outcomes, including the potential for counterpositioning, whereby rival firms mutually boost their profits by taking opposing positions on a social issue. The model shows that such counterpositioning is more likely when issue salience is high but agreement is low, when markets are highly competitive, or when CSR is largely symbolic.

Keywords: Corporate Social Responsibility, Social Movements, Stakeholders, Competition, Social Issues, Polarization

JEL Classification: M14, D43, D21, D63, D64, D72

Suggested Citation

Cohen Mohliver, Aharon and Crilly, Donal and Kaul, Aseem, Corporate Social Counterpositioning: How Attributes of Social Issues Influence Competitive Response (April 5, 2021). Available at SSRN: https://ssrn.com/abstract=3322775 or http://dx.doi.org/10.2139/ssrn.3322775

Aharon Cohen Mohliver

London Business School - Department of Strategy & Entrepreneurship ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

Donal Crilly

London Business School - Department of Strategic & International Management ( email )

Sussex Place
Regent's Park
London, NW1 4SA
United Kingdom

Aseem Kaul (Contact Author)

University of Minnesota - Minneapolis ( email )

321, 19th Avenue S
3-412 Carlson School of Management
Minneapolis, MN 55455
United States

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