Value Chain Extension: Making Sense of Strategic Corporate Social Responsibility Implementation

Strategic corporate social responsibility (strategic CSR) is highly praised by practitioners and academics for creating a potential win/win situation for business and society, yet little is known about its effective implementation. Using the case-study method to reveal the implementation mechanism, we track the strategic CSR activities of two Chinese property enterprises in the area of community involvement. We find that: (1) a clear statement of both commercial and social objectives focusing on customers' needs in corporate strategies is the first and most significant step; (2) that extending the traditional value chain by adding CSR activities within and beyond the business process (by means of vertical enrichment and horizontal adjunction) is an effective way to implement strategic CSR; (3) such implementing approach will develop cooperative relations between firms and stakeholders through their common engagement and inputs; and (4) it is the cooperative relations that enhances firms' competitive advantage, and also promotes continuous improvement in their commercial performance due to higher societal expectation. Furthermore, the leading role played by firm in launching CSR activities is significant in value chain extension. In this paper we help fill the gap in knowledge about strategic CSR implementation and contribute to stakeholder management theory. Some implications for corporate community involvement are also provided.