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Research on the drivers of corporate social responsibility (CSR) has long focused on the business case; that is, how market pressure can shift the dominant norms of business culture toward acceptance of CSR practices. This article examines the empirical evidence in support of the business case for CSR among Chinese firms to determine whether market forces are likely to drive the norms of Chinese business culture toward an embedded, or strategic, vision of CSR. Drawing on prior work in institutional theory, it then explicitly examines how legal institutions both undergird and undermine the business case for CSR in China.

This article observes that the evidence for the business case in China is currently mixed and that the limits of the business case are directly or indirectly linked to specific features of the Chinese institutional environment that limit the salience of stakeholders in managerial decision-making. These findings suggest that policy initiatives recently adopted by governments in China and other emerging markets that rely on market forces to drive CSR also depend heavily on the strength of legal institutions and, in the Chinese context, commitment by local officials and state agencies as primary stakeholders of Chinese firms.

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