Corporate Social Responsibility Helps Companies Fend Off Attacks

Crime is a serious risk for firms. A recent international study conducted by Price Waterhouse Coopers has revealed that one company out of three was victim of a crime in the previous twelve months, while three out of four executives interviewed by KPMG forecast that the risk of fraud will remain stable or increase a year from now.
Crime against companies has complex causes. Risk factors are individual (low moral integrity, state of need), organizational (faulty security procedures, adverse personnel selection) and social (criminal subcultures, gaps in policing). It is thus indispensable that firms react according to the nature, reason, and context of the threat.
There are four types of crime. At one extreme, there is "pure crime, that is, when the firm is attacked for purely criminal reasons by actors that have no relation with it. Organized crime and professional criminals fall into this category.
At the other extreme, there are "legitimate reactions", i.e. situations where crime is perpetrated by traditional stakeholders (employees, customers, suppliers) that act illicitly but on the basis of a socially legitimate urge, motivated by needs, expectations, and entitlements that are worthy of consideration. In 2009, French industrial workers took hostage the managers of various companies (including Sony, Caterpillar, and 3M) as extreme conflict measure against lay-offs and wage cuts. According to a poll, 45% of the French people deemed acceptable these illegal actions. That kind of social support helps workers win important concessions.
A different situation is the "betrayal of trust", where crime is committed by members of a traditional category of stakeholders who however pursue illegitimate ends, such as personal gain. These exploit the access they have to the firm and its facilities and information systems, to commit theft, fraud, and other kinds of crimes.
Finally, there is "rogue heroism", i.e. crimes that are committed by those who are not legitimate stakeholders but are fighting for a cause that is considered legitimate by society. For instance, when an authoritarian regime prevents local political groups from pursuing socially legitimate ends (such as the defense of civil liberties) by legal means, such groups can resort to violence in the name of their cause (for instance, by kidnapping executives of foreign multinationals).
Companies can respond to such risks with security techniques, but also by positively influencing stakeholders. In a recent paper of ours ("Keeping the enemies close: The contribution of corporate social responsibility to reducing crime against the firm", Scandinavian Journal of Management, n. 1, 2011) we have explored to what extent CSR policies can act as a defense against crime, helping companies gain legitimacy, meet the interests of stakeholders, and positively respond to the expectations of justice and fairness in corporate behavior.
Thanks to CSR, firms can reduce the incentive for crime against them and avoid situations in which the perpetrators can develop convincing justifications for their illegal acts. Also, by securing the support of legitimate stakeholders, which can help firms fend off attacks through the respect of internal norms and disapproval of hostile acts. The significance of such effects depends on the type of crimes targeting the firm. CSR is of little use against pure crime, but it can discourage legitimate reactions, because it can contain dissatisfaction and the sentiment of injustice it brings with it. This brings an advantage not only to firms, but also to communities where they have set shop, because the prevention of crime reduces social strife and violence.