Bringing theory to practice: how to extract value from corporate social responsibility

This contribution aims to clarify the role of corporate social responsibility (CSR) as an issue of governance and a strategic tool more than a mere communication activity, with a potential impact on both organizations and their economic and financial performance. The analysis focuses on how CSR investments can create value for companies and for stakeholders in general. This can occur if the related benefits exceed the related costs, generating a favorable balance toward what we called the virtuous cycle of CSR. This cycle is made up of four steps – decision, design, action and result – that define a potential value creation path that a responsible firm can take, assuming that it integrates a social agenda into its competitive strategy and assuming that the market appreciates real and effective social efforts of companies.