Decay and Recovery of CSR Routines in Franchise Organizations

Abstract

Corporate social responsibility (CSR) activities have become increasingly prevalent in retail settings. In franchised organizations, franchisors typically design and coordinate these activities, leaving operational execution to franchisees. Meanwhile, franchisors may introduce new corporate-led CSR activities over time. Even though changes to CSR activities may refocus outlets’ attention on a CSR initiative, they may also disrupt an outlet’s ongoing CSR routines. Using a longitudinal, secondary dataset consisting of an eight-year panel for a national, franchised restaurant chain, we examine CSR performance dynamics in the presence of two distinct types of CSR activities: an ongoing CSR routine and a distinct, temporary CSR campaign. We find that, when resuming the CSR routine after a temporary CSR campaign, outlets’ performance in CSR routines drops significantly (i.e., immediate decay), then improves gradually (i.e., protracted recovery). We also consider the moderating role of an outlet’s experience, finding that experience stabilizes these decay and recovery cycles. Our findings represent a first step in developing a longitudinal understanding of how a firm’s short-term CSR campaigns may impact ongoing CSR routines, thus contributing to the knowledge of CSR activity development and routinization.