Drawing on upper echelons and responsible leadership theories, we examine how CEO responsible leadership (CEO RL) affects a firm’s CSR and financial performance. Our analyses of a sample of 416 Forbes Global 2000 companies, encompassing 16 countries for the period 2003-2020, reveal that CEO RL is positively related to CSR and firm performance. Further, we explore how context variables (i.e., national culture, type of market economy, industry discretion, and crisis) affect our main relationships and examine how CEO RL relates to different types of CSR (i.e., internal, and external). We find that in national cultures with high institutional collectivism and high power distance, the effect of CEO RL on financial performance is weaker, while higher managerial discretion strengthens the relationship. Moreover, during the global financial crisis, the effect of CEO RL on CSR is stronger. Lastly, CEO RL does not affect different types of CSR.

Reliance on the 'wisdom of crowds' appears increasingly unreliable at achieving the common good. The moral realism of Peter Railton offers an interesting approach to the problem as a conceptual one; suggestions from Railton's theory offer insights about how social and political disagreements might be approached in a different way.

The role of business schools in propagating socially and environmentally damaging management practice has become increasingly apparent (Evans & Tourish, 2017; Ghoshal, 2005). Nevertheless, business school academics are often hamstrung in their efforts to make business schools more responsible by pressures to performatively constitute and thus inhabit the role of the archetypically ‘successful’ academic: one who focuses on theory development over real-world impact or graduate employability over responsible management education (Kalfa & Taksa, 2017; Mingers & Willmott, 2013; Ratle & Bristow, 2020). While scholars have theorised the means by which a more responsible academy can be prefigured and delivered (Gümüsay & Reinecke, 2022; Wickert et al., 2021), understanding remains limited as to the role of individual, practical scholastic agency, particularly the substantive steps already being taken by academics, in creating responsible, caring and impact-driven business schools. Drawing on interviews with 46 current and former Business and Society Early Career Researchers working across six continents, we examine the means by which their performance of moral identity work (Shao et al., 2008) within the academy, affords the motivation and creativity to disrupt and reconfigure the nature and constitutional performativity of the ‘successful’ academic. We identity four key forms of such moral identity work: reframing, retheorising, rallying and reorientating and their juxtaposition with taken for granted types of academic work. We conclude with discussion of the implications of the performance of such moral identity work in terms of positive futures for the co-constitutive praxis of the business school and managerial work.

Background

Corporate purpose is gaining prominence among corporations globally. Purpose reflects an important shift from the traditional focus on maximizing shareholder value, towards addressing society’s grand challenges such as climate change and rising social inequalities (Bhattacharya et al., 2023; George et al., 2023; Mayer, 2021).

Despite the rising adoption and scholarly attention on corporate purpose (see Zenger, 2023), the role of the institutional environment remains largely unexplored (Aguilera, 2023; Almandoz, 2023; George et al., 2023). While the extant literature has focused on how firms’ purpose relates to financial performance (Gartenberg, 2023; Gartenberg et al., 2019), it often overlooks that purpose has different interpretations and is framed differently across institutional contexts (Almandoz, 2023). This oversight stands in stark contrast with the related field of corporate social responsibility (CSR), which has repeatedly emphasized the role of the institutional environment in shaping firms’ responsibility behaviors (Campbell, 2007; Ioannou & Serafeim, 2012; Matten & Moon, 2008; Wry & Zhao, 2018).

Only recently have purpose scholars started to pay attention to the role of the institutional context on purpose. For instance, Battilana et al. (2022) suggests that liberal economic environments may complicate purpose due to market-driven pressures, diminished influence of non-market actors, and cultural norms that legitimize the objective of maximizing shareholder value.

Research Question

This study explores how corporate purpose is shaped by the institutional context in which firms are embedded. In contrast to the Anglo-American context of shareholder capitalism, where most purpose research remains practiced and conceptualized, Asia offers a compelling alternative landscape. Asia is characterized by high institutional diversity as it is home to many varieties of capitalisms or national business systems (NBSs) with distinct cultural, economic, and political features (Witt & Redding, 2013). Examples include ‘collective capitalism’ in Japan, ‘Confucian capitalism’ in South Korea[1], ‘alliance capitalism’ in Thailand, and ‘entrepôt capitalism’ in Singapore (Hundt & Uttam, 2017). Accordingly, as observed in prior studies on Asian corporate responsibility (Chapple & Moon, 2005; Kim & Moon, 2015; Witt & Stahl, 2016), we expect variation in corporate purpose across Asian countries. This makes Asia an appropriate setting for the objectives of this study, as it seeks to answer the question:

“How do the diverse institutional contexts within the Asian business systems shape firms’ orientations toward corporate purpose?”

Methodology

The study looks at five distinct Asian business systems: the Japanese (Japan), advanced Northeast Asian (Korea), advanced city (Singapore), post-socialist (Vietnam) and emerging Southeast business system (Malaysia). The inclusion of these countries makes this the first empirical study to cover all five Asian business systems identified by Witt and Redding (2013).

In each country, we conducted a survey with senior managers from large Asian firms, including board members, managing directors, and general managers. The respondents were asked to evaluate the current business prioritizations of their firm along three related aspects of corporate purpose: objectives (why does the firm exist?), stakeholders (whom does the firm serve?), and values (what guides the firm’s decisions?). With the complexities of cross-national research and the challenge of engaging senior managers (Hambrick, 2007; Witt & Redding, 2009), the study was carried out by a consortium of scholars from five leading management schools across Asia. Every country included in this study had representation from a local university, and we leveraged the personal and university networks to identify and reach out to senior managers within large firms. This non-random, purposeful sampling approach was chosen due to the difficulty of accessing high-level respondents and the meager response rates observed in similar studies (Hermano & Martín-Cruz, 2016; Pepper & Gore, 2014).

The online survey was administered using Typeform and structured into three parts. The first part collected demographic data from the respondents, including nationality, age, gender, company name, current role, and tenure position. The second part of the survey focused on corporate and personal perspectives on purpose. Three questions focused on objectives (5 items), stakeholders (7 items), and values (4 items), respectively, and respondents were asked to rank the different options. The final part of the survey included an open question, which asked respondents to explain discrepancies between business practices and their personal views. The survey was translated into Korean, Japanese, and Vietnamese, with a back-translation process to ensure consistency. A total of 204 valid surveys were collected (Table 1).

Results

Descriptive Results

The ranking questions on the most salient firm objectives, stakeholders, and values reveal distinct patterns in purpose orientations across the five business systems (Figures 1-3). Figure 1 highlights the emphasis on producing consumer goods and services as the top objective across all countries. Shareholder value maximization is also prominent, particularly in Korea and Malaysia, while Japan and Vietnam exhibit ambivalence toward this objective. The pro-social objective of providing solutions to societal and environmental challenges is prioritized in the highly developed Japanese and Singaporean economies, in contrast to the developing contexts of Malaysia and Vietnam. The least prioritized objectives include employee income and benefits and national development, except in Vietnam, where national development is the most salient.

In Figure 2, customers and shareholders consistently rank as the most important stakeholders. Singaporean firms prioritize employees, while the government is more salient in Vietnam and Malaysia. Society is ranked relatively higher in Singapore and Japan but lower in Malaysia and Vietnam, with suppliers, distributors, and creditors generally considered less important across all countries. Figure 3 shows financial performance as the dominant guiding value in business decisions across all countries, followed by community impact and employee well-being. The latter is particularly salient in Malaysia and Vietnam. Malaysian firms stand out for considering community impact to be the least important. Finally, environmental impact is the least salient value in most Asian business systems.

Principal Component Analysis

We employ the Categorical Principal Component Analysis (CATPCA) to identify underlying dimensions to explain the patterns in firm objectives, stakeholders, and values. CATPCA extends traditional Principal Component Analysis (PCA) and is specifically designed to handle datasets with mixed measurement levels including ranking data (Linting et al., 2007). The CATPCA analysis reveal two main underlying dimensions (Table 2). Dimension 1 emphasizes societal contributions and community impact, often in tension with financial performance and shareholder value maximization. Dimension 2 is similarly negatively associated with financial performance and shareholders, and instead positively associated with employees in all aspects of stakeholder, objective, and values. Accordingly, we refer to Dimensions 1 and 2 as the ‘outward’ and ‘inward’ purpose orientations.

Table 3 shows the results for the two purpose orientations by country, showing marked variations between the five business systems. A Multivariate Analysis of Variance (MANOVA) test confirms significant differences between countries (p < .001), indicating that corporate purpose varies across the business systems.

Interpretative Analysis

Answers to the open-ended question provide an interpretation of the observed variation. Japan’s business system has a strong outward purpose (+0.55) and a negative inward purpose (-0.11). This aligns with existing literature that positions the country as an exemplar of stakeholder capitalism in which firms exist to serve society, which is also evident from Japanese managerial views. For instance:

“It would be good if companies could focus on their original purpose, which is to be a company that provides rewarding work and is meaningful to society.” (JP001).

However, there is growing concern that this ‘original purpose’ has been compromised, particularly regarding the inward purpose of providing rewarding work to employees. Managers note that current business practices, influenced by Japan’s stagnant macroeconomic conditions, have shifted focus towards satisfying shareholders at the expense of employee well-being. Challenges associated with traditional business practices and hierarchical decision-making also present barriers to realizing a more balanced purpose. Managers call for more inclusive decision-making processes through “non-hierarchical dialogue” and suggest that board roles must be reviewed to support greater consideration of employee well-being alongside societal contributions. As one manager puts it:

“I do not disagree that company should emphasize contribution to society, but I think it is important to consider how much the company can take into account the thoughts and happiness of its employees.” (JP034).

While the advanced business system of Korea exhibits a moderate outward purpose (+0.09), its inward purpose is notably negative (-0.24). Korean managers express concerns that current business practices focus on external stakeholders and short-term financial performance, at the expense of employee well-being. A key issue managers highlight is the concentration of decision-making power among shareholders and top executives, which limits employee influence on major corporate decisions. Hierarchical corporate governance structures further hinder the inclusion of employee perspectives:

“The authority of shareholders (owners) is so large that professionals or employees have limited influence on major decisions. It is desirable to separate ownership and management as much as possible”. (KR033).

Singapore’s advanced city economy stands out for exhibiting a positive outward purpose (+0.50) and inward purpose (+0.39), suggesting a balance between external and internal stakeholders. Singaporean managers generally align with their companies’ perspectives on purpose but note some nuances, particularly regarding ownership structures and their influence on corporate decisions. The profit motive remains a significant driver for many Singaporean businesses, particularly for public companies:

“In our case, we are founded as a for-profit company; hence our decisions are always guided by the desire to grow profit.” (SG010)

Despite acknowledging profitability as a primary objective, this does not appear to compromise the purpose orientations. Instead, managers recognize the importance of balancing financial performance with social responsibility and satisfaction from internal stakeholders.

The emerging business system of Malaysia is the only country with negative scores on both outward (-0.34) and inward (-0.31) purpose dimensions, suggesting that Malaysian firms uphold a more traditional focus on financial performance and shareholder interests. This is evident from managerial views’ explicitly stating that financial gain and profit margins are the main priority, especially under challenging economic circumstances:

“Tough economic times. Bottom line for the company now is the profit margin. Employee care comes after.” (MY006)

Managers acknowledge the importance of focusing on employees. However, their rationale is mainly instrumental. Managers emphasize that taking care of employees is a means to achieve better corporate performance rather than an end in itself. For instance:

“Sometimes employees are the ones that we need to emphasize to make sure they work towards the objective of providing shareholder returns.” (MY078).

Vietnam's post-socialist business system stands out with a notably strong inward purpose (+0.59), suggesting a significant emphasis on employees. In contrast to Malaysian firms, managers highlight the importance of balancing the firms’ multiple objectives. This includes ensuring the rights and well-being of employees, which stand alongside financial performance. For instance:

“In my conglomerate, the issue is not to develop the business in any individual’s desired direction, but the business’s growth must achieve the vision, goals, and mission set by the business, contributing to the prosperity of the nation, society, and workers.” (VN035).

This statement illustrates that workers’ rights and well-being are integral to corporate objectives, explaining the observed strong inward purpose. Moreover, corporate decision-making in Vietnam appears to be consensus-driven and indicative of a collective approach to business decisions.

Conclusion

Our results underscore the important role of national institutional contexts in shaping firms’ orientations toward corporate purpose. They suggest that efforts to promote a more stakeholder-oriented or purposeful approach cannot adopt a one-size-fits-all model but must consider each business system’s specific cultural, economic, and political features.

Moreover, our findings indicate that corporate purpose is not a uniform concept but encompasses multiple dimensions that can sometimes contradict each other. For instance, in Japan and Korea, firms exhibit an outward purpose toward societal goals, yet this sometimes comes at the expense of the inward purpose. This duality highlights the complex and multifaceted nature of corporate purpose.

The observed varieties of purpose in this paper stress the need to contextualize corporate purpose within specific institutional frameworks, moving beyond its predominantly Anglo-American conceptualizations.

[1] South Korea, or the Republic of Korea, is hereafter referred to as Korea.

Companies have considerable discretion as how to arrange their tax affairs. Corporate tax strategies can be viewed as a continuum, ranging from the ‘tax-as-cost’ to the ‘tax-as-contribution’ approach. Existing tax compliance theories fail to explain the role of stakeholders in corporate tax decision-making. To fill this gap, our paper develops a model which describes the process and the mechanisms with which stakeholders can influence a firm’s tax behaviour. We build on the distinction between self-regarding and other-regarding stakeholders to speculate about diverging stakeholder preferences over corporate tax policies. Secondly, the model describes the mechanisms with which other-regarding stakeholders can drive firms towards more socially desirable tax outcomes. By doing so, our paper broadens our knowledge on the determinants of tax avoidance and contributes to the debate around the role of stakeholders in enhancing ethical behaviour on the part of companies. Finally, some practical implications for policy makers’ fights against corporate tax avoidance are offered.