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The IUP Journal of Business Strategy
Service-Oriented Leadership Style for CSR: A Perceptions-Based View.
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Since the time of the Industrial Revolution, managers have tended to view people as tools, while organizations have considered workers as cogs in a machine. In the past few decades, we have witnessed a shift in that long-held view. In countless for-profit and nonprofit organizations today, we are seeing traditional, autocratic, and hierarchical modes of leadership yielding to a different way of working—one based on teamwork and community, one that seeks to involve others in decision making, one strongly based in ethical and caring behavior, and one that is attempting to enhance the personal growth of people while improving the caring and quality of our many institutions. This emerging approach to leadership and service began with Greenleaf. A particular strength of servant leadership is that it encourages everyone to actively seek opportunities to both serve and lead others, thereby setting up the potential for raising the quality of life throughout society. The purpose of this study is to analyze the relationship between servant leadership dimensions of employees and their perceptions on social responsibility implications. The scale developed by Laub (1999), which is based on 6 different dimensions, was used to measure servant leadership. Corporate Social Responsibility (CSR) scale used in the study was developed by Carroll (1999) and has four dimensions—economic, legal, ethical, and philanthropic. Differences based on select demographic variables too were assessed. By understanding this relationship, certain practical recommendations are presented. These recommendations are especially important and shed light on the impact of servant leadership dimensions on social responsibility practices and thus help bridge individual level perceptions to firm level implications.

 
 
 

Corporate Social Responsibility (CSR), defined as “the broad array of strategies and operating practices that a company develops in its efforts to deal with and create relationships with its numerous stakeholders and the natural environment” (Waddock, 2004, p. 10), has moved from ideology to reality. A large number of corporations in different countries have adopted the United Nation’s Global Compact policy, committing to align their business operations with a set of standards of socially-responsible behaviors. These widespread CSR efforts are driven not only by ideological thinking that firms can be positive forces for social change but also by the business returns that firms potentially reap from CSR engagement. Prior research has shown that CSR enables a firm to appeal to the socio-cultural norms of its institutional environment and contributes to its social legitimacy (Scott, 1987; Handelman and Arnold, 1999; and Palazzo and Scherer, 2006). In turn, social legitimacy ensures the continuous flow of resources and sustained support from the firm’s internal and external stakeholders (Pfeffer and Salancik, 1978; Sen and Bhattacharya, 2001; and Palazzo and Scherer, 2006), which ultimately results in enhanced financial performance by the firm (Margolis and Walsh, 2003; and Luo and Bhattacharya, 2006). Considering the importance of leadership in shaping organizational strategies and practices, the lack of research on the interface between organizational leadership and CSR is noteworthy (Waldman and Siegel, 2008; and Groves and LaRocca, 2011a).