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K.3 CSR strategic options

By analyzing IKEA’s corporate social agenda in terms of its contribution to added value, one can see which of Galbreath’s314 strategic options IKEA’s CSR strategy resembles. We can conclude that IKEA’s CSR strategy definitely is not a shareholder or altruistic strategy. As IKEA is a foundation and not a listed company, it has no shareholders to which it must maximize returns. T. Bergmark regards this as entailing a great advantage as the company can work more long-term with CSR as it is not driven by goals of short-term profit maximization.315 Furthermore, as earlier discussed IKEA does engage in generic social issues, which have no direct business ties. IKEA’s CSR strategy can also be considered much more business-oriented and diverse than that what an altruistic strategy would imply. One can regard IKEA as currently moving from more of a reciprocal to increasingly more of a citizenship strategy. Previously as well as at present, most of its CSR efforts had a clear rationale and was strongly tied to core business activities.316 It was also strongly focused on engaging in partnerships in order to benefit sales and reputation. The citizenship strategy has the broadest scope and we regard IKEA as not having reached this yet. This is because although IKEA has a proactive dialogue with NGOs regarding CSR and wants to strengthen this, the input of other stakeholders such as customers, employees and suppliers is still rather low. The dialogue with these stakeholders is not integrated into decision-making; instead decisions are made by the “IKEA Service Office” as well as by store managers and can thus be considered rather top-down. Another indication is that IKEA is not transparent on all levels; it is rather weak in communication towards other NGO stakeholders than its own partners. In addition to this, the method of dealing with stakeholder needs and interests is not integrated at store level in the form of the franchised IKEA concept. However, IKEA’s current changes are increasingly focused on community involvement and engaging in a wider variety of issues as discussed previously. This shows that IKEA is heading towards a citizenship strategy.

As we have now examined IKEA's motivations for CSR and its strategic dimensions, we can see that IKEA realizes its economic, legal and ethical responsibilities, in terms of its common goods approach, legitimacy quest and sustainability focus. It is only when all these responsibilities have been taken into consideration that a company can or should focus on its philanthropic responsibility.317 This corresponds to IKEA's current phase; it is starting to move into this direction and taking on more responsibilities with the citizenship strategy. As it has evolved and progressed, it can now take philanthropy into its CSR mix.

Through viewing IKEA’s CSR in the light of Porter & Kramer’s as well as Burke & Logsdon’s theories318, we can conclude that in general IKEA’s CSR is very strategic as it contributes to enhancing competitiveness. IKEA’s CSR contributions can be considered as highly central, specific, voluntary and proactive. Nevertheless, IKEA has been moving towards integrating more generic social issues in its corporate social agenda. This will lead to lower specificity and centrality. This broader view on CSR is in line with a move towards a citizenship strategy. A striking finding of our analysis on the strategicness of IKEA’s CSR is that although IKEA scores high on four dimensions, visibility is rather low. We will examine this phenomenon in the following section.

314 315 316 317 318

Galbreath, J. ( 2006). Interview Stål, E., 2008-05-13. Galbreath, J. ( 2006). Carroll, A. (1991). Burke, L. & Logsdon, J. (1996), Porter, M. & Kramer, M. (2006).

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