Business Responses to Environmental and Social Protection Policies: Towards a Framework for Analysis

Abstract

This conceptual paper seeks to advance neo-institutional work that has traditionally portrayed environmental and social protection policies as constraints followed by businesses. Drawing from the policy sciences literature, we propose that in the United States businesses tend to show increasing resistance as the protective policy process moves from initiation to selection and growing cooperation thereafter. Most importantly, we also contribute to the neo-institutional theory literature by positing that this inverted U-shaped policy process-business response relationship proposed for the U.S. context may be moderated by variations in the: level of democracy, system of interest representation, regulatory approach, and national income.

Keywords: Institutional theory, corporate social and environmental responsibility, public policy process, and developing countries

JEL Classification: M14, N5, Q28, K32