Does organizational culture mediate the CSR – strategy relationship? Evidence from a developing country, Nepal

Abstract

This study investigates whether adoption of corporate social responsibility (CSR) is associated with differentiation strategy, and if so, whether the association is mediated by organizational culture (in particular, innovation and respect for people dimensions), using survey data collected from 132 companies in Nepal. The results of the study suggest that adoption of CSR is directly linked to differentiation strategy, while further Partial Least Squares Structural Equation Modeling (PLS-SEM) analyses reveal that the link is fully mediated by the innovation and respect for people dimensions of organizational culture. While prior studies have emphasized the role of innovative culture, our findings suggest that the respect for people culture is equally essential in order to achieve successful integration of CSR into organizations' strategy. This study contributes to the limited, albeit developing, stream of research on CSR, strategy, and organizational culture by providing insight into the important role of organizational culture on the CSR–strategy relationship. The paper concludes by outlining avenues for future research.