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INTRODUCTION
Visitors to Chinese firms often see organization units with a purely social function, which are unrelated to or only loosely coupled with firms’ core business units. These social function units are organizational substructures that offer social services supportive of but distant from firms’ business units and goals, such as kitchens, dining halls, medical clinics, and affiliated schools for the children of employees (Lu, 1989; Pfeffer, 2006). Rather than outsourcing these services, many firms directly run them. Economists suggest that the creation of these social function units and provision of these social services are leftovers from the planned economy and that spinning off the social function units is essential for restructuring state-owned enterprises (SOEs), as part of building modern enterprises (Lin, Cai, & Li, 1998). Even without mandates and instructions from state and local governments, however, some newly established privately owned firms even now maintain social function units to provide social services internally (Zhang & Zhang, 2010).
Why do these firms in China still incorporate social function units and offer community services? Answering this question is practically and theoretically important because it helps us better understand how some contemporary Chinese firms operate and how they perform corporate social responsibility (CSR) activities, thereby advancing extant theories about organization.
This phenomenon found at Chinese firms resembles the idea of organizations as communities proposed by Pfeffer (2006: 4), who suggested that in the past Western firms took care of employees (and their family members) in every aspect of daily activities, and ‘there were deeper connection between companies and their workers and more of a sense of communal responsibility than exists today’. Pfeffer listed the dimensions that characterize the degree to which organizations are communities; for example, helping employees when they are in need – whether financially, in personal relationships, or spiritually – building recreational facilities within firms, and extending concern to the health and well-being of employees’ families. However, at the time he was writing, a ‘trend toward more market-like and distant connections has spread throughout the world’. He claimed that ‘the absence of much sense of community in most organizations is quite real and quite important for understanding the evolution of work in America, the relationship between organizations and their people, and the attitudes and beliefs of...