From Corporate Social Responsibility to Supply Chain Regulation in Europe: Economic Perspectives

This chapter approaches the notion of corporate social responsibilityCorporate Social Responsibility (Rolf H. Weber) (Silvia Ciacchi/Michael Faure) (CSR) from an economic perspective. The first part considers the reasons behind the existence and persistence of CSR in corporate practices and investigates the market-based leverages for voluntary sustainable corporate behaviour. The chapter unveils how a company’s relationship with key stakeholder groups (especially its investors and consumers) can favour CSR as a profit-maximising strategy. In doing so, the chapter provides an explanation for the progressive institutionalisationInstitutionalisation (Silvia Ciacchi/Michael Faure) of CSR in the form of mandatory regulatory initiatives in different legal systems, focusing on the European Union. The second part examines the Corporate Sustainability Due Diligence DirectiveCorporate sustainability due diligence directive (Silvia Ciacchi/Michael Faure) (CSDDD) as an example of the institutionalisationInstitutionalisation (Silvia Ciacchi/Michael Faure) and entrenchment of norms originating from the CSR space into hard law. Here, a critical assessment of key aspects of the newly adopted CSDDD in its final version is provided.