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Multinational Enterprises and Distance: Exploring Opportunities and Challenges involved in Practicing CSR in Host-Countries
Halmstad University, School of Business, Engineering and Science, Centre for Innovation, Entrepreneurship and Learning Research (CIEL). University of Education, Winneba, Ghana.
2017 (English)In: Journal of Developing Country Studies, ISSN 2224-607X, E-ISSN 2225-0565, Vol. 7, no 4, p. 80-97Article in journal (Refereed) Published
Abstract [en]

This study explores how multinational enterprises (MNEs) should implement corporate social responsibility (CSR) to build external legitimacy, especially in subsidiaries operating in host-countries, where the effects of distance is felt most by MNE foreign subsidiaries. For long, international business (IB) research has analysed the effects of distance on MNEs’ expansion to host-countries, while a parallel strand of work in economic geography investigates the dimensions of proximity and how they influence firms’ knowledge development, especially in the varying host-countries they operate. Despite the noticeable relatedness and complementarities, these two bodies of literature have so far poorly interacted. Moreover, despite increased strategic motivation for corporate social responsibility (CSR) practices, we still lack understanding of the effects of distance on MNEs’ CSR behaviour in host-countries. The present study addresses this limitation by analysing and integrating the extant literature on how MNEs can, through their CSR behaviour in host-countries, cope with and mitigate the effects of distance. It provides perspectives on what may constitute appropriate CSR strategies in varying host-countries’ institutional environments (i.e., what CSR strategies might be appropriate for MNEs to adopt in a more proximate/less distant and less proximate/more distant institutional contexts and their implications for the effects of distance). Based on an analysis of the extant literature, the present study discusses patterns of complementarities across distance and proximity, and draws attention to avenues for future research that, in a more effective way, interact the two strands of literature, thereby setting the ground for empirical testing of a conceptual framework proposed by this study.

Place, publisher, year, edition, pages
New York, NY: International Institute for Science, Technology & Education , 2017. Vol. 7, no 4, p. 80-97
Keywords [en]
Multinational enterprise, distance; proximity, corporate social responsibility
National Category
Economics and Business
Identifiers
URN: urn:nbn:se:hh:diva-33822OAI: oai:DiVA.org:hh-33822DiVA, id: diva2:1094419
Available from: 2017-05-09 Created: 2017-05-09 Last updated: 2018-06-07Bibliographically approved
In thesis
1. (Investigating) MNCs' CSR-related behaviour and impacts in institutionally and culturally distant markets: African developing-countries in focus
Open this publication in new window or tab >>(Investigating) MNCs' CSR-related behaviour and impacts in institutionally and culturally distant markets: African developing-countries in focus
2018 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

The overall purpose of this thesis is to explore why and how institutional distance and contextual differences influence MNCs’ CSR-related behavior in African developing-countries. In order to achieve the purpose stated above, the thesis seeks to answer the overarching research question: How do institutional distance and contextual differences influence MNCs’ CSR-related behavior in African developing countries? To answer the research question this thesis employed an interpretive methodological approach in order to increase my understanding of the CSR phenomenon in a specific contextual environment characterized by different institutional distance through different theoretical and empirical perspectives (Guba and Lincoln, 1994; Lincoln and Guba, 2000). The thesis consists of two qualitative case studies, a systematic literature review, a conceptual paper focused on analyzing distance and MNC foreign subsidiaries’ CSR-related behaviour, and a longitudinal content analysis of annual CSR reports.

The thesis found that the most prevalent CSR themes addressed in journal articles focused on developing-countries have been social issues, followed by environmental issues as a distant second, with ethics-related issues receiving the least attention. The findings further indicate that CSR rhetoric plays a more positive and significant role than so far explored in CSR research, as it incentivises the host-communities to push for the fulfilment of their CSR expectations or CSR initiatives proposed by the mining companies. Soft’ regulations to which members of industry associations voluntarily adhere mitigate the absence of enforcement of more stringent hard regulations by the state for companies. In doing business in distant or different institutional contexts, institutional duality of MNC subsidiaries renders business activities complex and even conflicting when it comes to seeking internal and external legitimacy. This finding and the proposed model extend Hillman and Wan’s (2005) argument of the existence of ‘institutional duality’ of MNC subsidiaries. The 60-item disclosure index is in itself a contribution to research as it provides a measure of ‘disclosure quality’ in relation to the disclosures of CSR-related performance information and CSR-related governance information.

The main theoretical contribution of the thesis is that CSR expectations in developing-countries are distinct and may be more important to know how these empirical realities are taken into account when firms with their origin in developed-countries internationalize and enter markets in developing-countries. Second, an extended model is proposed which illustrates the roles of organizational fields, institutional pressures, legitimating environments, and legitimating strategies for MNC subsidiaries’ voluntary disclosure of CSR performance information. The overall contribution of the thesis is that it deepens our understanding of the CSR phenomenon, and of the role of host-communities and MNC subsidiaries’ managers from the context of developing-countries.

© Gideon Jojo Amos

Place, publisher, year, edition, pages
Halmstad: Halmstad University Press, 2018. p. 85
Series
Halmstad University Dissertations ; 47
Keywords
multinational enterprises (MNEs), corporate social responsibility (CSR), corporate social responsibility reporting (CSRR), African developing-countries, legitimacy, stakeholders, institutional theories, organizational learning
National Category
Business Administration
Identifiers
urn:nbn:se:hh:diva-36935 (URN)978-91-87045-98-1 (ISBN)
Public defence
2018-06-07, O104, Kristian IV:s väg, Halmstad, 10:10 (English)
Opponent
Supervisors
Available from: 2018-06-21 Created: 2018-06-07 Last updated: 2018-07-12Bibliographically approved

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