Aseem, you’ve worked on many important questions, including how firms pursue social and political impact.  Can you tell us about your research in this area?  When is it legitimate for a firm to pursue social or political aims? 

Broadly, my research interests are less about what firms do and more about what organizations of all types do.  Im interested in Grand Challenges, and how we use what we know about organizations to address them.  Historically, we have used what we know to generate profit for firms.  Now, the question before us is:  How can we deploy this knowledge to find solutions to big problems?  Firms are good at innovation, but non-profits and governments may not be.   These other types of organizations are less strategic and therefore often less effective than we want them to be.

Your thinking has evolved!

Yes, when I started I was interested in firms, including especially in Mergers & Acquisitions between them.   At this point, I am skeptical about whether firms can move beyond pursuing profit.  Firms don’t have the capabilities to solve important problems.  They have a small role in addressing big societal problems.

My research has shown that corporate philanthropy is used strategically by firms to maximize profits.  You are better off as a firm giving money to main concerns – i.e., by spreading your money to achieve a kind of insurance effect.   My general thinking is that firms sometimes do things that are beneficial for society, but that firms are not the solutions to our pressing problems.

Ive been looking at other organizational forms.  Im quite influenced by Ostrom’s 1990 insight about community-based solutions.  There are different ways of organizing to get things done.  The concepts we have about how to organize can be deployed across a range of organizations.

Is there a tension here?

Non-profits are less strategic because we have not supported them with the kinds of insights that we have in business schools for accomplishing important outcomes.   We need to apply the same rigor and discipline to understand heterogeneity in the performance of non-profits as we do for-profits.    In a new paper with Jiao Luo, for example, we see pro-competitive effects of non-profits in internet service provision.   The entry of a non-profit compels the competition to lower prices.  There are lots of other examples of what we might do for non-profits.

What do you see as the future of research on corporate social responsibility? 

We will need to think more clearly about social impact.  We’ve covered the ground on how to make more money with CSR.   Now we need more work on how CSR can improve social outcomes.  Jasjit Singh, Jiao and I have a new project on thinking systematically about impact, including spillover effects and unintended consequences.  We need to distinguish CSR that moves the needle.

Another big area:  How do we get from competitive advantage to system-level change?  We don’t have a great understanding on this.   What will it take for other firms to be like Patagonia?

I think you’ve expressed some skepticism about whether a stakeholder orientation can lead firms to improved financial performance.  Am I right about that? 

Stakeholder work has a basis but its relabeling things we already know, i.e., the ability of a firm to induce others to put in non-contractable effort.  This is core to the appropriation of value by firms, and we understand it well.   Firms innovate by doing this, sure, but this won’t save the planet.  It’s a 5%-10% issue.

What propels you and gives you energy?

The problems around us are fascinating.   The intellectual challenge of solving hard social problems keeps me going.   We stand on the precipice of an opportunity to reinvent Strategy.