Provisional Engagement with CSR: Strategic Decoupling as a Real Option

This paper investigates the persistence of Corporate Social Responsibility (CSR) decoupling despite the heightened transparency and associated risks in today’s business environment. While CSR decoupling—symbolically committing to CSR without aligning substantive actions—has been criticized for its potential to harm reputation, this study argues that it can be a strategic tool for firms. Integrating insights from Real Options Theory and Attention-Based View, we conceptualize CSR decoupling as a flexible strategy that allows firms to test and assess the potential business value of CSR before making further commitments, with attention shaping the likelihood of transitioning from symbolic to substantive CSR practices. Using data from 7,816 companies across 52 countries between 2011 and 2022, we provide empirical evidence that CSR-decoupled firms are likely to recouple when their corporate social performance improves. Our findings extend the classic decoupling theory by showing how transparency has shifted its dynamics and offering a new perspective on CSR decoupling as a strategic testing mechanism. This study contributes to the literature by integrating Real Options Theory and Attention-Based View into the CSR decoupling conversation, offering both theoretical and practical insights into how firms can navigate CSR commitments in contexts of intensified external scrutiny.