Corporate social responsibility remains one of the most popular topics in business ethics research. The role of CSR in organizational development has been explored in abundance. The positive effects of ethical conduct and CSR on organizational performance are widely recognized. But is the relationship between ethics and performance as simple as it seems? In their article, Lin, Baruch and Shih (2012) explore the relationship between CSR and team performance, and the mediating role of team efficacy and team self-esteem. The intended audience includes managers and students in business ethics. The results of this study shed new light on the way ethical conduct can benefit organizations in short and long-term perspectives.
According to Lin et al. (2012), their study contributes to the current knowledge of business ethics in two distinct ways. First, the researchers explore self-esteem and self-efficacy as two different constructs (Lin et al., 2012). By contrast, earlier studies tended to integrate team self-esteem and self-efficacy into a single construct (Lin et al., 2012). Second, the researchers approach the CSR construct in a new way and evaluate three different dimensions of CSR (Lin et al., 2012). Lin et al. (2012) assert that many researchers have failed to recognize the multidimensional nature of CSR. As a result, the discussed study is intended to close the existing gap in the professional understanding of CSR. In this study, CSR comes as a complex combination of three different dimensions: economic citizenship, legal citizenship, and ethical citizenship (Lin et al., 2012). Lin et al. (2012) conclude that all these dimensions greatly impact team performance, and team self-esteem and self-efficacy mediate this relationship. These findings complement earlier analyses of CSR and suggest that the relationship between CSR and team performance is not straightforward. As a result, it is at least incorrect to link CSR and ethical conduct directly to organizational and team performance. Managers should realize that CSR and team performance are indirectly related, and the role, which team self-efficacy and self-esteem play in the business world, should not be ignored (Lin et al., 2012).
Definitely, the results of the discussed study provide a novel look on the relationship between CSR, ethical conduct, and business performance. More specifically, the discussed study describes the complexity of the relationship between CSR and team performance. The study supports the common perception that ethically sound companies that have well-established corporate social responsibility principles and policies also perform well organizationally and financially (Solomon, 2011). However, it is too early to say that team self-efficacy and self-esteem are the fundamental factors mediating the effects of CSR on team performance. Lin et al. (2012) write that their study has serious limitations, and only future research involving longitudinal data can confirm the causality of the complex relationship between CSR and team performance.
I agree with Lin et al. (2012) in that “ethical CSR represents behaviors and activities that are not necessarily codified into law, but nevertheless are expected by society’s members and by employees” (p.171). I am absolutely convinced that ethical responsibilities within organizations extend beyond the law, and the law by itself is rather limited in terms of ethical obligations and ethical compliance (Hartman, 2008). Law is more a deterrent factor rather than a force, which motivates organizations to be ethical. I also agree with Lin et al. (2012) that the relationship between CSR and team performance is very complex. However, I suppose that team self-efficacy and self-esteem are just some of the many factors that mediate the relationship between CSR and performance. For example, future researchers may consider the effects of team diversity and professionalism on ethical compliance and performance. To a large extent, this research is just the beginning of a broad analysis of ethical conduct, CSR, and their implications for performance. Like Lin et al. (2012), future researchers will need to step away from the analysis of purely financial features and explore the effects of ethics on efficiency, productivity, and cohesion within teams.