Corporate foundations in the mining industry: the relationship between responsible investment and social investment

This article explores the relationship between responsible investment (RI) initiatives in capital markets and lending institutions, and the performance of social investment as a specific form of corporate social responsibility (CSR) in the mining industry. It focuses on how the nature of institutional investment initiatives encourages certain organizational structures for CSR activities. The argument is developed by exploring an inherent conflict between the business case motivations for CSR as promoted by RI initiatives, and the legitimacy of CSR activities being based on their performance-fulfilling normative CSR values. Corporate foundations in the mining industry provide the empirical context for examination. These organizations distribute the benefits of mining operations through social investment. They are -- interestingly -- both connected to their sponsoring mining firms and yet self-governed. The organizational form of corporate foundations works as a strategic response to RI initiatives because the form allows social investment practices at a distance from the corporation to maintain its normative legitimacy and thus create the CSR desired by investors. Framed by an institutional economic geography lens, this organizational dynamic indicates that the inherent conflict in RI initiatives produces greater attention to the form of delivery of CSR than to its functions.