The economics of corporate environmental responsibility

In this chapter, we investigate into corporate social responsibility (CSR) through the lens of environmental economics. Drawing upon existing research, our aim is to shed light on key concepts and establish a framework for understanding CSR, with a specific focus on environmental responsibility. We contend that a comprehensive theory of CSR must consider trade-offs among personal preferences, societal norms, and market imperfections. A critical challenge for advancing academic inquiry into CSR lies in enhancing environmental accounting frameworks, both at the national and firm levels. The current system of double-entry bookkeeping necessitates a more detailed integration of environmental, social, and material flow accounts to ensure feasibility for theoretical testing and practical application. Without such refinement, proposed CSR theories risk becoming obsolete due to their inability to undergo empirical validation.