A common explanation for why companies engage in CSR is that they aspire for external legitimacy. Companies try to prove themselves responsible through different activities and strategies that may meet with moral approval in a wider social context. A corollary of such approval is said to be the granting of legitimacy or a licence to operate. Although a possible explanation, this article analyses such a proposition as inadequate to capture the general functionality of CSR. The article claims that even though CSR may be seen as a legitimacy-seeking activity aimed to exhibit ideological correspondence with external social norms, many CSR activities have functional aims and follow another logical path. Such functional CSR tends to be employee-oriented and focuses on practical aspects of business rather than ideological ones. Another feature of functional CSR is that it is more oriented towards internal than external legitimacy. An implication of this is that ideological and functional CSR build on contrarian logics and processes for legitimation.