The microfoundations of responsible corporate political action

Abstract

We know that firms often engage in Corporate Political Action (CPA), and that it can be harmful for firms and for society. But we do not know enough about mitigating these harms. This is a problem for scholars, practitioners, and citizens concerned with the political role of corporations in modern societies. Hence my research explores Responsible CPA. My research was conducted in South Africa where legislation requires government to consult business on policy and regulation, but no guidelines exist on how business should participate responsibly therein, making South Africa an extreme but thus theoretically useful context for exploring Responsible CPA. Extant literature reveals that despite scholarly study of ideas related to Responsible CPA that has generated concepts, frameworks, and theoretical approaches alluding to it, nevertheless a widely accepted and actionable definition is missing. The implicit question is whether a common definition is even possible and whether individual CPA practitioners in widely divergent contexts can share an understanding of this concept. I used schemas theory to explore how CPA practitioners understand Responsible CPA and Q Methodology to systematically analyse CPA practitioners’ schemas related to Responsible CPA and identify the degree of similarity therein, establishing the utility of this methodology. I developed a new measurement instrument for this purpose. I show that a common definition of an ambiguous macro-level concept is possible, even across institutional settings: 87,6% of my participants had a shared understanding of Responsible CPA and I found commonalities in how it was understood in other settings. Employing these findings to create an actionable definition of Responsible CPA and add this concept to the lexicon, my research also contributes to the growing field of microfoundations scholarship in business, demonstrating how the perspective helps to open the 'black box' of firm conduct, in this case Responsible CPA. My framework for future research extends this, focusing on micro-macro linkages. On the basis of this work, I propose a code of Responsible CPA useful for practitioners, regulators and civil society observers.