University of Vaasa - Vaasan yliopisto

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and Alberini 2002). The function of regulatory threat depends on the credibility of
legislative method, i.e. implementation of new regulations in the case of defeat of
voluntary actions. In Japanese case the close relationship between them weakened
the regulatory threat because companies knew the government would consider the
status of companies. The costs of information acquisition for the government might
not be high at that time however it is doubtful if the monitoring costs, i.e.
transparency and liability of information provided by companies was enough low for
the government. Companies leaded legislation in a direction they wanted through
controlling information disclosure. As already argued, NGOs were in Japan as weak
as they were simply externalised from political institution. It was also rare that NGOs
were called for participation in Shingikai. Companies did not disclose information
but a serious problem was that NGOs did not have a sufficient literacy to exactly
understand technical or managerial information of companies due to the lack of
financial and human resources.
In Germany the relationship between the government and companies was neutral.
Thus the regulatory threat worked better than in Japan however this directed
companies to avoid new legislation through closing information. In addition the
hostile relationship between companies and NGOs calcified companies’ attitude. The
responsibility of proof of corporate unacceptable environmental degradation lied on
NGOs. Companies did not disclose information in order to avoid being targeted in an
anti-marketing campaign promoted by NGOs (Lyon and Maxwell 2008). The costs
of information collection and distribution were significantly high for NGOs.
Change for CSR; Start of CSR Development
This section discusses about the dynamic transition which affect the institutions in
Japan and Germany, because the institutions control the information costs. Peter Hall
defined institutions as “formal rules, compliance procedures, and standard operating
practices that structure the relationship between individuals in various units of the
polity and economy” (Schreurs 2003). There are many literatures to explore when an
institution fundamentally changed. For example, an unusual event has a big impact to
change political institution. The Chernobyl disaster fundamentally changed German
nuclear policy. The discovery of Ozone hole accelerated conclusion of Vienna
convention for the protection of the Ozone layer. Can we find such an impact on
CSR in these countries? Change of availability to political alternative is also
important. Transition of policy measure sometimes makes actors’ relationship
change drastically.
Internationalisation of Environmental Policy
Environmental policy has been internationalised since 1990s. Although movements
toward internationalisation of environmental policy could be found in early time (for
instance the Club of Rome) however the UNCED in Rio de Janeiro in 1992 was the
most important event for the environmental CSR in both countries. Since the role of