<apologies for cross-posting> 


Call for Papers

Special Issue of the Journal
of Business Ethics


Business Groups and
Corporate Responsibility for the Public Good


Guest Editors: Melsa
Ararat, School of Management, Sabancı University, Istanbul, Turkey

Asli M. Colpan,
Graduate School of Management, Kyoto University, Japan

Dirk Matten,
Schulich School of Business, York University, Toronto, Canada


Submission Deadline:
15 December 2016


Background of the Special Issue 

Business Groups have garnered growing attention of management
scholars over the last decade (Colpan, Hikino and Lincoln, 2010). However, the
mainstream management literature appears to treat the phenomenon of Business
Groups still more rather as an epiphenomenon. A core reason for this appear to
be that Business Groups, as Williamson (1975) has argued, conceptually straddle
the sphere between markets and hierarchies. The phenomenon of Business Groups–
despite having been more extensively explored by the literature in recent
years, remains multifaceted and the literature offers a variety of different
definitions (Colpan and Hikino, 2010). Business Groups are a set of at least
two legally-independent firms whose economic activity is often coordinated
through some form of hierarchical control via equity stakes and interlocking directorates
or managerial ties. Business Groups operate in multiple and often unrelated
markets with a common management and control, a characteristic that
makes them different from the multidivisional form of organization (Khanna and
Yafeh, 2007) and similar governance arrangements (Ararat, Black, Yurtoglu,


A particular area of interest in Business Groups appears to be
their sometimes considerable engagement in corporate (social) responsibility,
corporate sustainability, corporate citizenship etc. – labels which we here use
synonymously under the umbrella term ‘corporate social responsibility’ (CSR;
see Matten and Moon (2008)). Business Groups, particularly in emerging
economies, in various incidents offer remarkable levels of financial,
organisational and technological investments into the wider public good of the
communities, countries and regions in which they operate. Examples are
numerous: be it family governed business groups in India or Turkey, be it some
of the Korean Chaebols or Japanese vertical Keiretsu, be it large business
groups in Latin America or Europe – it appears that Business Groups are
particularly situated in addressing social needs, poverty, governance deficits
and institutional voids in welfare state provision and public governance. 


As such, the social responsibilities assumed by Business
Groups transcend the understanding of CSR in the traditional theory of the firm
perspective. The latter sees corporate responsibility for the public good as
voluntary activities which ultimately contribute to the bottom line (McWilliams
and Siegel, 2001). Looking at the engagement of Business Groups for the public
good though provides a much broader and richer picture. It includes those
standard CSR practices but often goes significantly beyond this scope: in
particular in developing/emerging contexts Business Groups, through their
foundations or through their actual core business, address institutional voids,
providing employment, products and services which essentially substitute and
emulate what would be considered welfare state provision in liberal developed
democracies. Beyond that, in many instances in some countries Business Groups are pivotal to the functioning of
markets, the setup of the economy, and the basic building blocks of the political
system, so that the question at the heart of this call for papers - the
responsibility of Business Group for the public good - is as much an
open research question as it has the potential to refine existing debates on


This societal role, however, is
far from being uncontroversial. Business Groups – given their size and
relatively high economic influence in their respective social contexts – are
often seen as being heavily involved in political rent-seeking (Kruger 1974),
investing primarily in political connections, as opposed to productive assets.
Baumol (1990) argues that large, invasive, and corrupt governments can make
political rent-seeking the highest return on investment available to most
firms, and that this can stall economic development. This can be a stable
situation in which particular rent-seeking Business Groups do well – their
investments in government connections yield high returns in subsidies, trade
protection, tax breaks, and protective barriers to entry; as do the politicians
who favor them; but the economy suffers from a lack of genuine investment in
productivity-improving assets and thus stagnates (Morck, Wolfenzon and Yeung
2005). This is often referred to as an “economic entrenchment trap” since this
phenomenon describes predominantly the strategic positioning of many Business
Groups in emerging economies. 


Other concerns regarding the
social responsibilities of Business Groups circle around their relationships
with their shareholders: corporate governance processes in Business Groups have
often been discussed rather controversially. The finance literature emphasizes
pyramidal structures built by controlling shareholders through a chain of
equity ties, and the possible conflicts of interests arising with minority
shareholders (La Porta et al., 1999; Almeida and Wolfenzon, 2006). The main
concern is that these organisations - often controlled by powerful families who
through various tools control the entire business – thus disempower other
minority shareholders in the firm. The knock on effects can have disastrous
effects on the efficiency (often the mere existence) of capital markets in
those countries and their ability to attract foreign direct investment. It
furthermore encourages various forms of corruption, as evidenced by the scandal
around the Italian Business Groups Parmalat (Melis, 2005) in the early 2000s. 


Purpose and Prospective
Themes of the Special Issue 

Despite the growing attention
Business Groups have received in recent years in scholarly debates, their
impact, roles and assumption of social responsibilities for the wider public
good has only received scant and, at best, anecdotal attention in the
literature. For instance, the Oxford Handbook of Business Groups (Colpan et al,
2010) – a comprehensive overview of the debate around research in Business
Groups – does not feature a single chapter or index item referring to corporate
(social) responsibility of Business Groups. It is here where this Special Issue
attempts at filling a significant gap in the literature. 

Research questions and themes
explored by potential contributions to this Special issue include, but are not
limited to the following aspects: 

If Business Groups take voluntary action to address the public good, in how far
is that part of their explicit policies and corporate strategy, and how far is
it just a response to institutionalized expectations in their respective

Empirically, what do Business Groups actually do when they practice CSR? Which
areas do they address? What are the drivers of those activities? 

 Comparatively, are there
differences between CSR notions or initiatives of Business Groups in different
countries? We observe different roles in different countries: In lower income 

one could argue that there is a focus on economic development, institution
building and provision of basic social needs, while in high income countries
Business Groups contribute through productivity growth, innovation and by
addressing externalities. What accounts for those differences? Are there

Do Business Groups as organizations have a common approach to CSR? How far is
their approach to CSR different from other forms of large businesses? 

What is the degree, form and organizational pattern of the relations Business
Groups establish to civil society? Are they pressured by civil society and NGOs
- or do they engage, collaborate and partner with those actors? What are
agendas of Business Groups in this context? 

Are there differences in the approach to CSR according to industries between
different Business Groups? 

Is family control a driver of CSR? Or is it actually an impediment? In the CSR
literature the consensus is that most of contemporary CSR is in some way
related to the business case as this reflects the core interest of
shareholders. Since Business Groups are in many instances controlled by
families does this make a difference? Do the values of the controlling family
impact and reflect the CSR approach of Business Groups? 

How do relations of Business Groups to governments and the political sphere
impact the public good? Do they co-opt the political sphere? Do they use their
considerable leverage to alter and change political processes and actors? Do
they just pursue firm specific agendas or do they use their influence for wider
societal objectives? 

How do the reputational benefits of group wide CSR, frequently implemented
through a foundation financed by affiliated firms or founding families, accrue
on individual firms? Would failure to respond to institutional pressures and
reputational risks by the business group management or one of the affiliated
firms effect other firms in the business group? 

What is the role of Business Groups with regard to institutional voids? Often
their monopolistic market power, their relationships to governments and their
control of key sectors can contribute to those voids. On the other hand, we
also observe considerable efforts by business groups to address those voids at
various levels. 

What is the relationship between a Business Group’s CSR activities and its
group-wide financial performance? 

 How are the CSR activities
coordinated at the headquarters and operating companies of a Business Group? Do
business groups engage in an orchestrated CSR at the group headquarters level,
or do they have independent CSR activities at several levels of their operating


Types of Submissions 

This special issue seeks to
expand our knowledge of the intersections between Business Groups, corporate
responsibility and governance for the public good. As such it invites
contributions from a broad range of sub-disciplines of management, including
(but not limited to) CSR, business ethics, sustainability, organizational
behavior/theory, international business, or corporate governance. We also
encourage theoretical approaches from a range of social and political science
disciplines, including business, law, politics, international relations, and


The Special Issue will feature
papers that pave new empirical and conceptual ground in this field of research
in intersecting phenomena. We seek both papers that deliver in-depth empirical
explorations of the topic and papers providing theoretical conceptualization,
analytical vocabularies and innovative methods for the understanding of the
intersection between Business Groups and CSR. We particularly encourage
submissions that develop our theoretical understanding of the phenomena by
showcasing relevant conceptual and analytical approaches. 


process and schedule 

Potential authors are welcome
to discuss further details about submissions with any of the three guest

Authors are strongly encouraged
to refer to the Journal of Business Ethics website and the instructions
on submitting a paper (please format the paper in the JBE style). For more
details about the types of manuscripts that will be considered for publication

Submission to the special issue – by 15 December 2016 –
is required through Editorial Manager at

Upon submission, please indicate that your submission is to
this Special Issue of JBE. 


The Guest Editors 

Melsa Ararat ([log in to unmask])
is the Director of Corporate Governance Forum, an applied research center, and
a senior research fellow at Sabanci University School of Management, Istanbul,
Turkey. She is the coordinator of Emerging Markets Corporate Governance
Research Network supported by IFC. Her research is focused on controlled firms
and family control. 

Asli M. Colpan ([log in to unmask])
is Associate Professor of Corporate Strategy at the Graduate School of
Management, Kyoto University, Japan. Her work has been published in such
journals as Industrial and Corporate Change, Journal of Management Studies,
and Corporate Governance: An International Review. She is the co-editor of
the Oxford Handbook of Business Groups, Oxford: Oxford University Press. Her
research interests include corporate strategy, corporate governance and
business history. 

Dirk Matten ([log in to unmask])
holds the Hewlett-Packard Chair in Corporate Social Responsibility at the
Schulich School of Business, York University, Toronto. He has published 15
books on CSR and business ethics as well as numerous articles in journals
including Academy of Management Review, Journal of Management
Studies, and Organization Studies. He is interested in CSR, business
ethics and comparative international management. 



Almeida, H. V. and Wolfenzon, D.
(2006). A theory of pyramidal ownership and family business groups. The
Journal of Finance, 61(6), 2637-2680. 

Ararat, M. and Black, B. S. and
Yurtoglu, B. Burcin, (2015) Corporate Governance, Business Groups, and Market
Value: Time-Series Evidence from Turkey (June 11, 2014). Northwestern Law &
Econ Research Paper No. 13-19; ECGI - Finance Working Paper. Available at SSRN: or 

Baumol, W. (1990): Entrepreneurship: Productive, unproductive
and destructive, Journal of Political Economy, 98, pp. 893-921.

A. M., Hikino, T., and Lincoln, J. R. (Eds.) 2010. The Oxford handbook of
business groups. Oxford, New York: Oxford University Press. 

Colpan, A. M. and Hikino, T.
(2010). Foundations of Business Groups: Towards an Integrated Framework. In:
Colpan, A. M., Hikino, T., and Lincoln, J. R. (Eds.) 2010. The Oxford
handbook of business groups. Oxford, New York: Oxford University Press, pp.

Khanna, T. and Yishay, Y.
Business groups in emerging markets: Paragons or parasites. Journal of Economic Literature, Vol. XLV (June 2007), pp. 331–372. 

Krueger, A. (1974). The
political economy of the rent seeking society. American Economic Review 64: 291–303. 

La Porta, R., Lopez-de-Silanes,
F., Shleifer, A., (1999). Corporate ownership around the world. Journal of
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Matten, D., and Moon, J.
(2008). ‘Implicit’ and ‘Explicit’ CSR: A conceptual framework for a comparative
understanding of corporate social responsibility. Academy of Management
Review, 33(2): 404-424. 

McWilliams, A., and Siegel, D.
(2001). Corporate social responsibility: a theory of the firm perspective. Academy
of Management Review, 26(1): 117-127. 

Melis, A. (2005). Corporate
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Morck R., D. Wolfenzon, and B.
Yeung, (2005), “Corporate Governance, Economic Entrenchment, and Growth,” Journal
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Williamson, O.E. (1975). Markets and Hierarchies: Analysis and Antitrust Implications. New
York: Free Press.