Might Corporate Social Responsibility Hollow Out Support for Public Assistance in Europe?

Date01 March 2018
DOIhttp://doi.org/10.1111/bjir.12227
Published date01 March 2018
British Journal of Industrial Relations doi: 10.1111/bjir.12227
56:1 March 2018 0007–1080 pp. 128–163
Might Corporate Social Responsibility
Hollow Out Support for Public
Assistance in Europe?
Brian Burgoon and Luc Fransen
Abstract
This article explores whether private regulatory activity to promote labour
and social standards might hollow out traditional public regulations to provide
welfareand labour protection at home and abroad. Such exploration has hitherto
been frustrated by empirical limitations of measures of private regulatory
activity and its implications for public regulation. The present article extends
those limits by focusingon how new measures of labour-related private regulation
aect attitudes in 27 European polities towards welfare redistribution and for
foreign assistance.Our analysis suggests that private-regulatory CSR promoting
labour and social standards may directly and indirectly diminish public support
for domestic welfareredistribution, but appears to have little eect on support for
foreign aid. We see, hence, possible crowding-out only with respect to domestic,
not international, assistance.
1. Introduction
Protecting social and labour standards is usually seen as the province of
public, hard-law regulations in redistributive welfare states, including the tax
code, social policies and employment regulations at home, and foreign aid
and trade policies addressing labour standards abroad. Increasingly, however,
protecting social and labour standards has involved development of soft-law
private regulation, including corporate social responsibility (CSR) initiatives
and ethical consumer movements supporting them.
This development has spawned several debates about the relationship
between public and private regulation to protect social standards. One debate
concerns the osetting or reinforcing eectiveness of public versus private
regulations in advancingworker rights (cf. Amengual 2010; Locke et al. 2013).
Another involves how the emergence of CSR and private labour regulations
Brian Burgoon and Luc Fransen are with the Department of Political Science and Amsterdam
Institute for Social Science Research,University of Amsterdam
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2017 John Wiley & Sons Ltd.
CSR and Support for Public Assistance in Europe 129
reflects and aects public provisions in more or less institutionally dense
advanced economies (Jackson and Apostolakou 2010). And a third involves
the relationship between individual attitudes towards ethical consumerism
and attitudes towards public policies (Bartley et al. 2015).
All three debates point to an unresolved controversy about whether the
rise of private regulations, activities and policies to promote them serve
to undermine or undergird public protections. On the one hand, some
studies claim that the public and private realms of social provision are
imperfect substitutes where development of the private labour regulatory
activity, or individual support for such activities, can undermine support for,
maintenance and/or development of public protections. Regardless of which
interventions are most eective, the governmental and non-governmental
realms are thought to work at cross-purposes, because they are imperfect
substitutes competing for scarce political resources, or provide incentives to
focus on particular interventions that hollow out alternatives (Cutler et al.
1999; Kinderman 2012; Reich 2008). A competing view, however, suggests
that public and private protections, or individual attitudes towards public
and private protections, can be expected to mutually reinforce one another,
as private regulatory initiatives sensitize actors to accept and create spillovers
to support public regulation (Campbell 2007; Gjolberg 2009b, 2011; Midttun
et al. 2006; Stolle et al. 2005).
These debates on public–private interactions can be explored in tandem
by focusing on individual attitudes towards labour and social protections.
Individual attitudes can be understood as citizen preferences significantly
undergirding political decision-making on public policies with reference to
citizen preferences, but also as consumer preferences undergirding corporate
decision-making. At the same time, private regulatory activity of firms
and non-governmental organizations (NGOs) and other manifestations of
CSR can be expected to inform individual attitudes towards public policies
protecting labour and social standards.
Based on these premises, the present study focuses on how measures
of labour-related CSR activity relate to survey questions gauging attitudes
towards welfare redistribution and aid policies protecting labour and social
standards. This contributes directly to the literature on individual attitudes
towards public–private substitution or complementarity. We build on the
welfare state attitude literature showing how existing policies can have
feedback eects on such attitudes, including ‘indirect’ eects by not only
directly influencing attitudes towards welfare states, but also altering how
individual socioeconomic characteristics shape such support. Applying this
dynamic to public–private interaction suggests that the presence of and
preferences for private regulatory activity can moderate, or alter, how much
and in what direction income and other socioeconomic conditions aect
support for public labour and social protections.
Understanding how private regulatory conditions and attitudes aect
support for public protections helps illuminate what could be an important
causal mechanism in the evolution of actual public policies promoting labour
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130 British Journal of Industrial Relations
and social standards, and corporate decisions on private labour regulation.
Students of the eectiveness of private and public labour regulations should
also take note of our findings. These scholars strive to understand the
conditions for eective public–private regulatory interactions mostly in
developing country settings. Our results supplement such understanding
by gauging the degree of citizen and governmental support in advanced
economies for international public interventions (such as foreign assistance)
relative to transnational private instruments for labour rights promotion
targeted at developing countries.
In pursuit of these goals, this article analyses surveys of citizen attitudes
towards public regulation in 27 European Union (EU) polities, linked to
our own new measures of private regulatory activity promoting labour
and social standards. Survey questions gauge citizen voter opinions that
provide political bases for publicprotection of labour and social standards at
home and abroad. The surveys also include questions about individual-level
ethical consumerism: a respondent’s willingness to pay more as consumers
to protect labour and social standards. We also develop original country-
level measures of labour-related private regulatory activity by firms and
NGOs. These data allow judgment of whether such measures of CSR
activity have negative, positive or no implicationsfor support for government
redistribution or foreign aid (development assistance). They also allow
judgment of whether such measures of CSR activity moderate the way
individual economic conditions like low income or education aect support
for welfare redistribution or foreign aid.
The findings are threefold. First, we observe substantial variation across
EU member states in our measures of three manifestations of CSR activity,
what we shall call ‘fair labour CSR activity’: the extent to which firms
endorse private labour standards, the number or density of NGOs relevant
to the protection of labour and the extent to which citizens express support
for labour-related ethical consumerism. These manifestations of private
regulation correlate positively with, and indeed can be expected to mutually
reinforce, one another. Second, we find that these features of labour-related
CSR may undermine support for domestic social protection, mainly through
indirect, or moderating, eects: The tendency of individuals facing economic
insecurities like poverty to be more supportiveof welfare assistance is weaker
among those citizens embracing or living amidst substantial labour-related
private regulation. Low income, for instance, increases support for welfare,
but is less pronounced in this eect among respondents either willing to
pay more to protect social standards, or living in settings with extensive
NGOs and firms engaged in private protectionof social and labour standards.
Third, private regulatory conditions do not appear to alter support for
foreign policies to help developing country standards, such as European
development aid. While many private labour regulations focus on emerging
economies that are potential recipients of this aid, we find no evidence that
such private labour regulation crowds-out support for governmental aid.
Altogether, these findings suggest that CSR activity promoting labour and
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2017 John Wiley& Sons Ltd.

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