DOI
10.1080/13504509.2013.808282

Summary
The modern discourse on corporate social responsibility is framed by ideas many of which have important parallels in the literature on the general and social systems theory. Particularly the conceptions of the interdependence between business and society, and of the societal embeddedness of business, revolve around the theme of system–environment interaction that is potentially unsustainable. The paper draws upon the systems-theoretic arguments of Luhmann and Boulding in order to explain how sustainability is enhanced by corporate social responsibility practices. Systems are shown to risk becoming unsustainable if they develop their complexity to the point of overstraining the carrying capacity of the environment. To forestall this scenario, systems can improve their sensitivity to the environment and constrain their own complexity. These sustainability strategies reveal the systems-theoretic meaning of corporate social responsibility. Explained in this way, corporate social responsibility turns out to be a functional equivalent of vertical integration seen from the perspective of Williamson’s transaction cost economics

Relevance for Complex Systems Knowledge
This artice applies the social system thinking of Kenneth Boulding and Niklas Luhmann to the discourse on how Corporate Social Responsibility can take account of businesses´deendence on social and environmental systems. Both Boulding and Luhmann recognizes that social systems mey become to complex and thus overburden their environment´s carrying capacity. Luhmann addresses the effects of functional differrention on ecological sustainability and Boulding identifies moral dilemmas confronting large organizations.

The objective of the article is to develop a systems-theoretic explanation why corporate social responsibility could in principle make corporations more sustainable, whereas the practical challenge is in devising corporate social responsibility in ways that work in the real world. In the proposed framework, systems can become more sustainable by improving their grounding in the environment, primarily by improving sensitivity to it and by constraining their own complexity.  These sustainability strategies reveal the systems-theoretic meaning of corporate social responsibility which is fundamentally about improving the grounding of modern corporations in their societal environment. The proposed systems-theoretic framework highlights parallels between corporate social responsibility and vertical integration in the perspective of Williamson’s transaction cost economics. Luhmann’s understanding of social integration as a reduction in the degrees of freedom of functional systems is germane to both Williamson’s vertical integration and corporate social responsibility.The authors hope that the proposed systems-theoretic perspective on corporate social responsibility will likewise spark further debate on how the development of complex technology can be linked to corporate social responsibility practices with a view to preventing the carrying capacity of the societal environment from being overstrained.

Point of Strength
The article applies some seminal systems thinking to a well discussed problem and find some relevant linkages. The article is pretty heavy and would be most suitable for use in late courses of a masters program.