Corporate Citizenship and Family Business

Claire Seaman

• Publisher: Routledge
• Year: 2022
• Print ISBN: 9781032247762
• eBook ISBN: 9781000569216
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Current models of corporate citizenship largely consider business as one coherent entity. This view of business as a corporate force overlooks the growing evidence that most businesses are run by families. Family businesses are the most common form of business in existence – across countries, continents and geopolitical divides – and yet we know remarkably little about their approach to corporate citizenship. Where families run businesses, they create a concentration of family values that – for good or ill – influence the way business practices and behaviours develop.

The role of the family in business has, therefore, an influence on the development of society that is partially mediated through corporate citizenship. This book pulls together current thinking from several diverse research fields that intersect with family business research to offer insight into current research and examples of practice for those studying and researching in the fields of family business, business values and corporate practice. The book will also explore the fact that family businesses tend to take a longer-term approach to business and that this is reflected in their behaviour towards the environment, community engagement, employee development and innovation.

Bringing together contributions from researchers in the diverse fields of family business, philanthropy, community engagement, corporate social responsibility, innovation and policy, this book explores the many ways in which family businesses contribute to the corporate citizenship agenda.

1 Citizenship Behaviours in Family Enterprises: Understanding Its Nature and Dimensionality

Neus Feliu and Isabel C. Botero

DOI: 10.4324/9780429281228-2

Introduction

In the organizational literature, the concept of citizenship has been used to describe behaviours of individuals and organizations that go beyond what is included as part of their responsibilities (Matten and Crane, 2005; Organ, 1997). At the individual level, the study of organizational citizenship behaviour has focused on understanding the drivers of these behaviours, the outcomes associated with individual citizenship behaviours, and the dimensionality of citizenship (LePine et al. 2002; Spitzmuller et al., 2008). At the corporate level, research on citizenship has focused on articulating what corporate citizenship is, its drivers, and associated outcomes (Barnett and Salomon, 2012; Carroll, 1998; Matten and Crane, 2005). In an environment where stakeholders hold individuals and companies accountable for both their financial and social performance, the general perception is that citizenship behaviours are likely to result in positive outcomes for the individual (e.g. higher job satisfaction, higher commitment, better mental health) and the corporation (e.g. better reputation, more satisfied employees, and better financial performance). As a reflection of this, research understanding individual, group, and organizational citizenship has flourished, and has generated a lot of traction from practitioners and researchers.

Although citizenship behaviours have been explored in the general management literature, in the family business context, academic research in this area is just starting, and has primarily focused on understanding the behaviour at the corporate level. For example, Miller, Le Breton-Miller and Scholnick (2008) suggest that family enterprises may be more inclined to engage in corporate citizenship behaviours because they have more at stake than non-family firms. Binz Astrachan et al. (2017) complement this knowledge by presenting a conceptual model showing how family and business goals drive different aspects of corporate citizenship, and how engaging in corporate citizenship can influence the reputation and performance of the family enterprise. More recently, Campopiano et al. (2019) explored the presence of women in the boards of directors as an important driver of corporate citizenship behaviours in family-controlled firms. However, even though family business scholars have highlighted that family firms are more likely to engage in corporate citizenship behaviours (Dyer and Whetten, 2006; Godfrey, 2005; Kashmiri and Mahajan, 2010; Seaman, 2017; Ward, 1997), we still have a very limited understanding of the nature and dimensionality of citizenship behaviours that occur in family enterprises (i.e. what are the different levels of citizenship behaviour?), and the drivers and outcomes associated with the dimensions of these behaviours. Understanding these aspects of family enterprise citizenship behaviours could help us outline the unique role that the business family might play in this behaviour and important areas that need to be explored in future research.

Building on previous work about citizenship behaviour at the corporate and individual level (Carroll, 1998; Graham, 1991; Matten and Crane, 2005; Organ, 1988), this chapter has four goals. First, we explain the concept of citizenship behaviour and outline what we know about citizenship behaviours in the context of family enterprises. Second, we propose a multi-level model to better understand the nature of citizenship behaviours within the family enterprise context. Third, we introduce the concept of business family citizenship and outline the drivers and outcomes associated with this type of citizenship behaviour within family enterprises. We finalize our chapter by the interconnections between the different levels of our model and outlining important areas for future research.

Citizenship Behaviours

The study of citizenship behaviours in the organizational context can be traced back to the work of Barnard (1938) and Katz (1964). Initially, the interest was centred on employee discretionary work behaviours that are not directly or explicitly recognized by the formal reward system of the organization but are important for its effective functioning (Organ, 1988). Later, this work shifted to include the behaviour of corporations that goes beyond profit-making to include the contributions of companies to the community and other important stakeholders (Carroll, 1979, 1998). However, the “citizenship” label was originally coined in the political philosophy literature to describe the status of belonging somewhere, and the responsibilities and rights that are associated with belonging (Graham 1986, 1991, 2000). Graham (1991) argues that citizens have three important responsibilities: Obedience (i.e. respect for orderly structures and processes), loyalty (i.e. concern for the welfare of others, the state, and the values that it embodies), and participation (i.e. involvement in governance). At the same time, citizens have civil (i.e. legal protection of life, liberty, and property), political (i.e. participation in decision-making), and social rights (i.e. socioeconomic benefits) that are not available to noncitizens (Graham, 1991).

Building on this idea of citizenship, two parallel literatures developed within organizational research. On one hand, organizational behaviour scholars and social psychologists explore the idea of organizational citizenship behaviours (OCBs). Research on OCBs has centred on understanding employee behaviours that are discretionary (i.e. a matter of personal choice) and contribute “to the maintenance and enhancement of the social and psychological context that supports task performance” (Organ, 1997, p. 91). This area of citizenship behaviours has received a lot of attention from scholars who have tried to articulate the factors that drive employee OCBs, the different types of OCBs that occur in an organization, and the different types of outcomes that are affected by these behaviours (Spitzmuller et al., 2008). Although there have been many types of OCBs explored (See: Ilies et al., 2007; LePine et al., 2002; Podsakoff et al., 2009 for detailed lists), these behaviours can be grouped into two broader types: employee behaviours that are directed to individuals (OCB-I) and those that are directed to the organization (OCB-O) (McNeely and Meglino, 1994; Williams and Anderson, 1991).¹ Researchers have also explored a variety of predictors and outcomes that are related to citizenship behaviours (See Figure 1.1 for brief summary). In a broad sense, research has concluded that employee citizenship behaviours are important because they are likely to positively influence organizational effectiveness through their effects on how social systems within the organization work, how employees feel, and the effect that these behaviours have on task performance (Organ, 1997).

Figure 1.1 Overview of Nomological Network for Employee OCBs based on Spitzmuller, Van Dyne, and Ilies (2008).

The second type of citizenship behaviour explored in the organizational literature has been corporate citizenship. Corporate citizenship is generally defined as the extent to which businesses engage in behaviours that will help them meet the economic, legal, ethical, and discretionary responsibilities imposed on them by their stakeholders (Maignan and Ferrell, 2000, p. 284). This concept is often connected to the idea that organizations have a degree of social responsibility to all their important stakeholders. Thus, some researchers refer to it as corporate social responsibility (CSR) or corporate ethics (Aguinis and Glavas, 2012; Carroll, 1998; Matten and Crane, 2005). There have been multiple conceptualizations of what counts as corporate citizenship. For example, Carroll (1998) suggests that there are four sides to corporate citizenship. The economic side encompasses the company's need to be profitable, reward their investors with a strong return on their investments, and assure other stakeholders of the continuity of the business so they can be “good corporate citizens”. The legal side speaks of “good citizens” functioning in compliance with the law. A third side references the need for leaders and organizations to support and enact strong ethical values to be “good citizens” for society. This part is concerned with the ethical responsibility of leaders and their fairness practices. Finally, the philanthropic side describes discretionary responsibilities which describe “corporate citizens” as those who strive to contribute resources to the community that they are part of.

Using a human resource perspective, Brammer, Millington and Rayton (2007) propose a different framework that suggests that corporate citizenship (i.e. which they label CSR) can be thought of as being focused inside and outside of the organization. Internal corporate citizenship behaviours are those that are performed by the organization that affect internal members (i.e. employees) and internal operations. These include behaviours such as employee training, continuous education, safe working environments, and ethical labour practices (Rupp and Mallory, 2015). External corporate citizenship is behaviours directed to external stakeholders and includes activities such as philanthropy, volunteering initiatives, community/economic development programs, and environmental sustainability programs (Rupp and Mallory, 2015).

The rise of research that focuses on corporate citizenship is linked to a growing pressure that stakeholders (i.e. customers, activists, governments, and media) place on companies to account for the social consequences of their activities, and the financial risks associated with conduct that is deemed unacceptable (Porter and Kramer, 2006). Research in corporate citizenship has tried to understand the drivers and outcomes associated with these behaviours. However, due to the relevance of corporate citizenship to the firm, most of the research has focused on understanding the effects of corporate citizenship on organizational performance (See: Aguinis and Glavas, 2012 for a detailed review) and on employee attitudes and behaviours (See: Aguinis and Glavas, 2012...

Table of contents

• Cover
• Half Title
• Series Page
• Title Page
• Copyright Page
• Contents
• List of Contributors
• Introduction
• 1 Citizenship Behaviours in Family Enterprises: Understanding Its Nature and Dimensionality
• 2 Sustainability in Historic Family Firms
• 3 Employees Returns on “Ramadan Packages” as a Corporate Social Responsibility Practice: Moderating Role of Perceived Corporate Sincerity
• 4 Antecedents and Influences of Corporate Citizenship: Case Study of a Finnish Family Firm
• 5 Family Businesses, Family Values and Corporate Citizenship
• 6 Does Corporate Citizenship Have Gender?
• 7 Impact of Financial and Cost Management Systems for Family-Owned Businesses' Corporate Citizenship
• 8 Consciously Contributing: Community Engagement, Philanthropy and Family Business
• Index