BRIC companies seeking legitimacy through Corporate Social Responsibility

Abstract

BRIC countries have generally gone through a process of liberalization and rapid economic growth that has allowed their major companies to acquire increasing weight in the global marketplace. However, they are still striving to achieve full legitimacy in the international arena. In a bid to close this legitimacy gap, BRIC firms are making efforts to align with the Environmental, Social and Governance (ESG) global norms of doing business, and recently have adopted a portfolio of Corporate Social Responsibility (CSR) initiatives. In this paper we provide a deeper exploration into the factors that relate to BRIC firms' adoption of different types of CSR initiatives-i.e. social policies (philanthropic projects favoring different stakeholders), publication of CSR reports, adoption of GRI standards; adherence to and financial support for the UN Global Compact. We carry out an empirical analysis on 60 BRIC large public companies, and find support for the idea that different kinds of CSR initiatives may be subject to different pressures and may serve different legitimization strategies.

Corporate Environmental Disclosure in India: An Analysis of Multinational and Domestic Agrochemical Corporations

“…The results are consistent with I-MNCs wishing to reduce their "liability of foreignness" and therefore adapting to external legitimacy pressures [57,58]. They can do this by disclosing similar environmental information as domestic Indian companies.…”

“…Multinational corporations face greater complexity in achieving and maintaining legitimacy [57]. This is because, in addition to facing the complex institutional environment that all organizations encounter, multinationals also face increased complexity within the corporation itself caused by fragmentation, operation in several institutional environments, and "liability of foreignness" (i.e., the obstacles faced by corporations operating in a foreign market) [57,58]. Archel et al [59] emphasize that legitimacy strategies are linked to the political environment within which a company operates; these include "the patterns of corporate ownership, business law and regulation, state intervention in commercial activities, the influence of religious or ethnic considerations, the degree of public concern about the environment, the prominence of civil society and attitudes to philanthropy or social responsibility" [60] (pp.…”

Stakeholder integration, environmental sustainability orientation and financial performance

“…Our findings contribute to the stakeholder and environmental sustainability literatures in the following specific ways. First, we show that firms adopt environmental sustainability initiatives lead to positive outcomes demonstrating the convergence toward globally accepted environmental sustainability standards (Fiaschi et al, 2015;Zheng et al, 2015, Marano, Tashman & Kostova, 2017. Thus, it is worthwhile for firms seeking to improve their financial performance to engage in environmental sustainability orientation, especially in the period when firm's sustainable strategies are receiving increasing attention from various stakeholders.…”

“…Where firms experience the so-called liability of origin, their geographical location actually becomes a liability which restricts their ability to collaborate with other firms and access scarce resources and expertise (Amankwah-Amoah & Debrah, 2017). A key global strategy for such firms to limit their liability of origin is by adopting initiatives that demonstrate convergence toward globally accepted environmental sustainability standards (Fiaschi et al, 2015;Zheng et al, 2015;Marano, Tashman & Kostova, 2017). Thus, we expect stakeholder integration to be positively related to ESO.…”

Sustainable procurement practices in the Brazilian chemical industry context

“…Although a wide variety of studies establishes environmental and social criteria for suppliers' selection. It is also important to highlight that companies are increasingly facing alarming incidents of non-compliance regarding sustainability (Fiaschi, Giuliani, & Nieri, 2015;Wilhelm, Blome, Bhakoo, & Paulraj, 2016;Jamali & Karam, 2018). Thus, Govindan et al (2015) argue that additional research is required to identify and more clearly define each of the criteria.…”