Unpacking the Institutional Complexity in Adoption of CSR Practices in Multinational Enterprises

Abstract

Multinational enterprises (MNEs) operate in complex transnational organizational fields with multiple, diverse, and possibly conflicting institutional forces. This paper examines how such complex environments affect a firm's adoption of Corporate Social Responsibility (CSR) practices. To capture the effect of transnational fields, we consider the institutional influences of all country environments to which the firm is linked through its portfolio of operations and propose that these effects will be weighted depending on their relative salience. We identify a set of factors that make certain pressures more salient than others, including firm's economic dependence on a particular country, heterogeneity of institutional forces within the firm's transnational field, exposure to leading countries with more stringent CSR templates, and intensity and commitment to particular economic linkages (i.e., foreign direct investment versus international trade). Our hypotheses are tested and supported in a study of 710 US MNEs from 2007 to 2011 with global ties to over 100 countries.

Multinational enterprises and the Sustainable Development Goals: An institutional approach to corporate engagement

“…Hence institutionalism helps explain why companies engage in socially responsible behaviour (Campbell, 2007), how corporate sustainable development is shaped (Bansal, 2005), and how such activities differ across companies from, and operating in, different countries (e.g. Matten & Moon, 2008;Marano & Kostova, 2016).…”

“…By being an intergovernmental agreement, an institutional approach lies at the heart of the SDGs. Moreover, political and economic institutions govern corporate behaviour, including their sustainability activities (Campbell, 2007;Matten & Moon, 2008), their ethical activities, their internationalisation strategies (Marano & Kostova, 2016), as well as the ways in which they address stakeholder concerns (Freeman, Wicks, & Parmar, 2004). For these reasons, and following Campbell (2007), we consider institutions as an important and primary -but not the sole -driver for MNEs to engage with specific SDGs.…”

Field or Fields? Building the Scaffolding for Cumulation of Research on Institutional Fields

“…In network terms, populations are in structurally equivalent positions within fields; they have the same type of relations with similar others. Industry populations include organizations that produce the same products and services, such as information technology (Murray & O'Mahony, 2007), often with geographic bounds such as Israeli high technology (Zilber, 2006) or Boston or New York mutual funds (Lounsbury, 2007), as clear national and regional differences in populations have been found (Faulconbridge & Muzio, 2016;Marano & Kostova, 2016). Social movement populations include the set of organizations that are focused on activism on the same or a broadly similar issue, such as environmentalism , slow food (van Bommel & Spicer, 2011), gender equality (Clemens, 1993), or LGBTQ rights or identities (Armstrong, 2002;Briscoe & Safford, 2008).…”

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

“…These observations suggest that international firms are presented with a unique challenge that can impact how they undertake their CSR activities and we argue that a study of CSR and IB should be situated within this context. Although scholars like Marano & Kostova (2016) admit to this peculiarity, they however limit the elements to host country and parent company influence only, excluding international Non-Governmental Organisations (NGOs), rating agencies and home country influence, which are additions that this study proposes should also be considered.…”