The Visible Hand of Consultants in the Construction of Markets for Virtue
Despite the resurgence of Corporate Social Responsibility (CSR), little is known about the social construction of CSR markets. This paper looks at the visible hand of management consultants in the creation of markets for virtue.
The markets for fair trade, socially responsible investment, consultancy, auditing, or reporting all have in common a search for building business opportunities out of some of the side effects of the capitalist system. In this regard, these 'markets for virtue' illustrate the capacity of the capitalist system to re-internalise negative externalities through market mechanisms, or embed morality at the core of market functioning . The development of these markets also highlights the blurring of the boundaries between the social, market and political spheres that accompanies the emergence of a new form of 'regulatory capitalism', characterised by reliance on 'responsive regulations' and the mobilisation of market mechanisms by activists and social movements.
Despite their growth, surprisingly little is known about the formation of the markets for virtue. On the managerial and economic side, they are regarded as too narrow to enhance corporate profitability. On the sociological and political side, they are regarded as an illegitimate and dangerous transformation of social and environmental issues into commodities. Thus the following question has remained partially unanswered: How are the markets for virtue socially constructed?
This paper addresses this question by focusing on the role played by consultants in the constitution of a specific 'market for virtue'-the market for CSR consultancy services in Québec, Canada. Theoretically, we combine conceptual resources from economic sociology (Fourcade and Healy, 2007; Morgan, 2008), business regulation literature (Edelman, 1990, 1992; Parker and Nieelsen, 2011) and prior works on the role of management consultants (Heusinkveld and Benders, 2005; Kipping and Clark, 2012) to revisit the conceptualisation of CSR commodification as a multifaceted process of market construction, triggering new forms of responsive regulations and oriented by the 'visible hand' of management consultants. Empirically, we rely on secondary data and 30 interviews with 23 consultants and three government officials to develop three narratives that capture complementary facets of the constitution of this market. Our first narrative explains how consultants have built on feminist movements to construct the market for 'responsible' events. The second narrative retraces how consultants enabled the emergence of consultancy services by subjecting purchasing to 'social responsibility'. Finally, the third narrative focuses on the role of consultants in the diffusion of a new local norm for making organisations 'socially responsible.'
These stories uncover the 'visible hands' of consultants in markets for virtue. Our narratives uncover how consultants act as social and environmental issues translators who reconstruct and repackage issues into 'sellable' propositions. In addition they act as market boundary negotiators, who shift and create boundaries to expand or protect niche segments in the market for CSR consultancy services. They also act as responsive regulation enactors, who regulate corporate conduct through their active reliance on, mobilisation and promotion of, CSR laws and standards to develop new commercial opportunities. Lastly, the implications of these three roles for the analysis of the construction of markets for virtue, the role of management consultants, and the micro-dynamics of responsive capitalism are discussed.
The full draft research paper can be downloaded below.