Corporate social responsibility research: the importance of context

Abstract

There has, in recent times, been an increasing interest in understanding corporate social (and environmental) responsibility (CSR) and, in particular, CSR reporting in developing countries. However, many of these studies fail to investigate fully the contextual factors that influence CSR and reporting in those countries, preferring to rely on theories and hypotheses developed from studies undertaken in the West, particularly the US, UK and Australasia. It may be argued that this is appropriate as many emerging economies are experiencing growth and moving towards having a more market-based orientation. Notwithstanding this, a large number of these countries have an entirely different socio-political environment, with different political regimes, legal systems and cultural influences. These factors have a significant effect on the applicability of theories such as stakeholder theory, legitimacy theory and accountability theory, which are commonly used to explain the phenomenon of reporting. In State Capitalist countries, such as China, an important influence on companies is the political ideology that underpins the nation's government. The nature and impact of ideology and hegemony in China has been under-studied and, therefore, investigating how the ideology, and competing forces that may mitigate its influence, manifest themselves in Chinese reporting are essential. In the Middle East, countries such as Saudi Arabia have no free press, are ruled by a royal family, have a market dominated by the oil industry, and potential religious influences. Such socio-cultural differences mean societies develop different understandings of concepts such as sustainability and social responsibility. Finally, countries such as Sri Lanka have some similarities to other developing countries, but their economy is set against a background of a recent civil war -operating in a post-conflict economy is a factor rarely considered in social and environmental disclosure, yet has important influence on policy in these areas. This paper discusses three contextual issues that warrant more and improved consideration in CSR research, with particular emphasis on CSR reporting research.

Does context matter for sustainability disclosure? Institutional factors in Southeast Asia

“…First, our study presents insights into commonalities and nuanced differences in the institutional contexts across six countries in SEA region, responding to calls for more comparative SD studies from non‐western perspectives (Arena, Liong, & Vourvachis, ; Patten & Shin, ; Tilt, ; Williams & Aguilera, ). Thus, our findings could enable an expansive understanding of SD within the SEA region, and its institutional environment, potentially opening up opportunities for more comparative cross‐national research from a multi‐region perspective.…”

“…First, our study presents insights into commonalities and nuanced differences in the institutional contexts across six countries in SEA region, responding to calls for more comparative SD studies from non-western perspectives (Arena, Liong, & Vourvachis, 2018;Patten & Shin, 2019;Tilt, 2016;Williams & Aguilera, 2008 scholars' arguments that not all institutional factors impose the same pressures upon organisational practices (Mainardes et al, 2011). It also emphasises the importance of examining the nature of institutional pressures to understand how their configurations of in different countries could shape non-market practise such as SD (Hartmann & Uhlenbruck, 2015;Jamali & Carroll, 2017).…”

“…For instance, countries in the South East Asia (SEA), a sub-region in Asia, which has diverse socioeconomic issues, ranging from poverty, climate change, to human rights violations, child labour, and corruption (Belal, Cooper, & Roberts, 2013) have proactively undertaken institutional reforms to influence corporate sustainability practices (Srinivasan, 2011). Nevertheless, as extant research examining institutional influences on corporate sustainability in non-western regions, is limited to single country studies (See Hermawan & Gunardi, 2019;Hu & Loh, 2018;Janggu, Darus, Zain, & Sawani, 2014;Zahid, Ghazali, & Rahman, 2016), we do not have a comparative cross-country level understanding of how country-level institutional influences could differ between countries within a non-western region (Fifka & Drabble, 2012;Vashchenko, 2017), and how those influences could engender corporate sustainability practices, specifically that of sustainability disclosure (SD) in that region (Patten & Shin, 2019;Tilt, 2016).…”

Corporate social responsibility and international business: examining the nexus and gaps from a developing economy perspective

“…Corporate Social Responsibility (CSR) has gained prominence in scholarship in Sub-Saharan Africa (Tilt, 2016) with many looking at various aspects of it. The CSR literature on Ghana and other African countries used to be scanty and could still be argued to be less exhaustive in comparison to a developed country's CSR research; but there has been sufficient academic interest in the subject in recent times prompting Tuokuu and AmponsahTawiah (2016) to suggest that the concept was no longer nascent in the West African country.…”

Examining Financial Performance, Firm Size, Leverage and Corporate Social Responsibility

“…Implementing CSR strategies can transform a company's image and thus lead to a positive outlook among consumers, suppliers, and communities served by the company (Amma, Thaliyan & Lekshimi, 2013). As thousands of companies in hundreds of countries participate in some level of CSR practices, research about CSR shifted from existential questions to the core business and contextual factors, processes, and related measures of financial and social findings (Tilt, 2016; Wang, Tong, Takeuchi, & George, Dahlander, Graffin, & Sim, 2016). Stakeholders may benefit from research that explains the relationship between financial performance, firm size, leverage, and CSR.…”