Managing paradoxical tensions between Corporate Social Responsibility and Automation: How organizations reach sustainability and digital transformation

Abstract

While organizations pursue automation to achieve superior performance, their stakeholders also demand that they be socially responsible. On one hand, automation looks at machines and how organizations enhance operational efficiency. On the other hand, Corporate Social Responsibility (CSR) looks at people by aligning companies with stakeholder expectations. Balancing automation and CSR often create organizational tensions since one looks at machines and another at people. However, both elements are essential for companies aiming to achieve sustainability and digital transformation in today's competitive landscape. Hitherto, no existing studies have explored how CSR and automation, viewed as paradoxical tensions, can be synergized to improve sustainability and digital transformation outcomes. This study aims to investigate the paradoxical interaction between CSR and automation, examining their joint effect on sustainability and digital transformation. The research employs an econometric analysis based on data from 402 Brazilian organizations to evaluate the influence of CSR and automation on financial, environmental, and social performances and digital transformation adoption. The findings reveal that while CSR and automation synergize to enhance environmental and social performance and the adoption of digital transformation, they have no significant effect on financial performance. However, in a post-hoc test, financial performance manifests after organizations achieve environmental, social, and digital transformation outcomes. This study provides theoretical insights into managing CSR-Automation tensions, advancing the literature on paradox theory in operations management. We offer a novel framework for reconciling the conflicting demands of CSR and automation. Simultaneously, we propose a balanced approach to achieving sustainability and digital transformation, underscoring the importance of managers balancing high commitment from CSR and high performance from automation.