Corporate Social Responsibility and Institutional Theory: Evidence from a Developing Islamic Nation

Abstract

Despite plethora of literature in the field of corporate social responsibility (CSR), the institution perspective of CSR is still sparse and very much fragmented and confined to studies from the Anglo Saxon perspectives. This study aims to fill this gap by providing empirical insights on the role of institutions in shaping the CSR concept, policies & practices in a developing Islamic country–Iran. Through a multiple case study approach, data was collected based on semi structured interviews with Iranian firms and institutions such as regulatory bodies, media and non-governmental organizations. Findings revealed that the adoption of CSR practices in Iran is very much influenced by industry-specific conditions, national socio-economic situation and company size. We found that informal institutions such personal values, culture, religion and traditions played a more prominent role in shaping the CSR policies and practices in Iran as compared to formal institutions such as laws and regulations. Media had a minimal role in the promotion of CSR and due to lack of healthy governance structures; firms were reluctant to adopt CSR practices since they could not see its actual value.