Corporate Social Responsibility Literature Research Articles

The catalytic effect of digitalization and health measures during COVID-19 on corporate social responsibility in the African context

Purpose This study aims to examine the effect of digitalization and sanitary measures during the COVID-19 pandemic on corporate social responsibility (CSR) in the African context. While CSR has traditionally been analyzed in developed markets, this paper explores how multinational subsidiaries can leverage CSR practices to create financial opportunities and market stability for themselves and their communities in Africa. Design/methodology/approach The authors use a panel of data from six listed African companies for the period ranking from January 2006–2022 to analyze the effect of financial performance (FP), digitalization and health measures on the social responsibility of these companies. The authors provide a robust test that improves the understanding of the impact of pandemics and innovation on CSR, using Machine Learning (ML) linear regression. Findings The results show that the social responsibility of African companies is highly dependent on FP and digitalization. On the other hand, the authors demonstrate that the moderating role of epidemic instability negatively affects social responsibility through FP, but on the other hand strengthens CSR in the presence of digitalization. The results of the initial analysis remain largely unchanged, demonstrating the validity and robustness of the empirical results through ML models. This article highlights some of the obstacles and opportunities for CSR adapted to the crisis context. The authors conclude that adjusting innovation strategies improves the forecasting performance of responsible companies, especially in a context of instability. Research limitations/implications The paper clearly shows that CSR literature varies across different regions. Given that the financial market in Africa is characterized by a lack of opportunity for innovation as well as financial stability, this paper represents an important first step in the elaboration of a CSR development strategy. In light of the results presented above, the study makes an important contribution to the literature on CSR, in particular the CSR practices of multinationals in developing countries and also provides CSR managers with various insights into the types of support they will need to leverage and improve the internal underpinnings of their CSR strategies and collaboration. Practical implications The results of this study contribute to the understanding of digital transformation in responsible business, offering empirical evidence of its benefits in tackling the health crisis. In addition, the study highlights the role of an innovative approach in enhancing reputation and developing sustainable, trusting relationships with stakeholders. Originality/value This research pioneers the academic link between innovation and epidemic crisis in responsible business, filling a notable gap and introducing a new academic perspective. In concrete terms, it provides women entrepreneurs with actionable insights into the digital strategies essential to improving business performance in a context of instability. Methodologically, the study sets a benchmark for research innovation, using ML to provide a reproducible model for exposing robust results and for future research in this evolving field.

Revisiting tokenism: impact of gender diversity on corporate social performance of Indian companies

PurposeThis study aims to examine the relationship between corporate governance, in particular board diversity, and corporate social performance (CSP) amongst the top 500 listed companies in India.Design/methodology/approachData from the top 500 listed Indian companies constituting the BSE500 index for a five-year period from 1 April 2014 to 31 March 2019 are used to test the impact of the proportion of women directors, proportion of women independent directors, female CEOs and other corporate governance variables on CSP.FindingsThe results of panel regression analysis suggest that firms characterised by high proportions of women directors, independent women directors or a female CEO spend more on corporate social responsibility (CSR) activities. Furthermore, CEO duality, board size and board independence are positively related to social performance. These findings are of relevance to the policymakers and board of directors who are engaged in meeting corporate governance requirements.Practical implicationsThis is one of the initial studies to document the impact of executive-level female representation on CSP following India's 2013 regulations on mandatory women representation on boards and CSR expenditure. The study reveals that greater gender diversity on corporate boards significantly boosts CSP, offering strategic advantages in governance and CSR. The study offers practical benefits for various stakeholders including corporate regulators, policymakers and corporate managers.Originality/valueThe paper contributes to the corporate governance and CSR literature by showing that good governance practices and high women representation on boards promote social performance. Our study is one of the preliminary efforts to document the level and impact of female representation at the executive level on CSP after the regulation of minimum women representation on corporate boards and mandatory CSR expenditure requirement introduced in India in 2013.

Environmental corporate social responsibility and stock price crash risk: The role of environmental performance and ISO 14001

This paper examines the impact of environmental corporate social responsibility (CSR) on stock price crash risk. Using a sample of publicly listed Chinese firms for the period 2010 to 2020, we find that environmental performance negatively affects crash risk. ISO 14001 certification, however, does not exert a significant effect. The negative relationship between environmental performance and crash risk is mediated by the visibility of the firm, and moderated by the certification of ISO 14001, respectively. In addition, the documented relationship is more evident for firms belonging to heavily polluting industries, non-SOEs and firms with greater media coverage and higher market competitive status. Our results remain consistent after controlling for endogeneity concerns and a batch of robustness tests. This study provides new insights into the CSR literature by highlighting the risk-mitigating role of environmental CSR in firms’ future stock price crashes.

The State of Corporate Social Responsibility (CSR): A Framework to Promote Community Gains from Mines in North-Western Province of Zambia

The study explores the current state of CSR exhibited by mining firms in North-Western province of Zambia. An argument is made that mining firms are not doing enough for the province through their CSR programs. The study uses content analysis to examine sustainability reports of two leading mining firms in the North-Western province of Zambia namely, Barrick Gold Corporation (BGC) and First Quantum Minerals Limited (FQML). Thereafter, the study engages various stakeholders through Focus Group Discussions (FGDs), interviews and a survey questionnaire to probe deeper the results of the content analysis and corroborate the evidence obtained from the mining firms. The study employs statistical methods and thematic analysis to analyze the primary data collected from the respondents. The study results indicate that the current state of CSR exhibited by the mining firms neither meets the expectations of the people in the province nor promotes gains in the host communities. CSR programs are only used to maintain the social license of the mining firms and to legitimize their existence in pursuit of maximizing profitability of the firms. The study contributes to the CSR literature by developing a framework that promotes community gains from CSR discharged by mining firms. The study results may also help the mining industry regulators to formulate future social and environmental responsibility indicators that may encourage mining companies to disclose more useful information to enhance the “quality” of disclosures in the mining industry. The two-stage data collection and analysis methods of content analysis and thematic analysis, together, add qualitative depth to our analysis which may help relevant stakeholders to improve their understanding of CSR practices in the mining industry.

Defiance as an image restoration strategy: refining the reputation risk management framework

Purpose This study aims to develop an understanding of strategies used by two major banks in Australia to manage reputation risk after court proceedings were initiated by the government for serious breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006. Design/methodology/approach The study is grounded in the corporate social responsibility (CSR) and image restoration literature. Thematic analysis of court proceedings, banks’ annual report suites (which include sustainability reports) and media reports was undertaken using the conceptual framework of reputation risk management (RRM). Findings A major new strategy of image restoration – defiance – emerged. It is contended that the existing RRM framework needs to be refined. Similarly, in the reducing effectiveness strategy, two new sub-strategies need to be included: refusal to acknowledge an incident as reputational damage and acceptance of the statutory penalty without legally challenging it. The banks also used traditional strategies of the RRM framework, such as reducing effectiveness by minimisation, bolstering, corrective action and mortification. Originality/value Trustworthiness and confidence are at the core of modern banking. Banks use CSR disclosures as the principal means for image restoration. The present paper explores the link between extant CSR literature and RRM.

Do consumers gain or lose when managers become socially concerned?

The Friedman Doctrine states, “an entity's greatest responsibility lies in the satisfaction of the shareholders.” This leads us to consider managerial firms’ corporate social responsibility (CSR) activities delegated by profit-maximizing owners. Our research follows the Ferstman-Judd-Skilvas framework to examine if profit-maximizing owners could ask managers to be socially rather than privately concerned and its impacts on social welfare, contributing to the literature of CSR by presenting the following results. First, CSR delegation is a dominant strategy. Second, CSR delegation reduces the industry output level. We further show that consumers’ surplus and social welfare decrease in the number of managerial firms adopting CSR delegation. The above results imply that socially concerned managers with profit-maximizing owners are socially undesirable in a market with output delegation.

Asset pricing when social preference meets lottery preference: Evidence from China

There is substantial evidence indicating that stocks with lottery-like payoffs have lower returns. Unlike existing studies that focus on the role of investor behavior in accelerating lottery premiums, we propose that investors’ social preference toward corporate social responsibility (CSR) could alleviate the underperformance of lottery-like stocks. Using a sample of all Chinese listed A-share stocks, we show that a negative relationship between lottery preference and stock returns does not exist among stocks that behave well regarding CSR performance. Furthermore, we show that better CSR performance and higher institutional ownership mitigate the overpricing of lottery-like stocks. Our research contributes to CSR literature by showing that behaving socially responsible can prevent stock prices from being overpriced when the stock exhibits lottery-like payoffs.

Enhancing sustainable fit between corporate social responsibility and innovation: Implications for firm performance

AbstractDespite several studies on corporate social responsibility (CSR) and innovation on firm performance, the extent to which different CSR practices interacts with distinct innovation types in enhancing firm performance remains underexplored. We draw on contingency theory to examine how internal and external CSR interacts with exploitative and explorative innovation to improve firm performance. We discuss the interaction effects using a panel dataset of 1156 publicly listed Chinese firms that disclosed CSR and innovation information from 2008 to 2019. The results indicate that firms with high‐internal CSR benefit to a greater extent from explorative innovation than from exploitative innovation as a means of enhancing performance. In contrast, firms with high‐external CSR benefit to a greater extent from exploitative innovation than from explorative innovation to improve performance. We contribute to strategy and CSR literature by revealing how firms match specific CSR practices with distinct innovation types to enhance firm performance.

How do corporate social responsibility perceptions facilitate advocacy behavior? The roles of organizational pride and responsible leadership

As a voluntary behavior, employees’ advocacy can enhance organizations’ competitive advantage and reputation. Drawing on social identity theory, this study explores the mechanism of by which corporate social responsibility (CSR) perceptions influence employee advocacy behavior using a sample of 333 two-stage data. The results show that internal and external CSR perceptions have positive effects on employee advocacy behavior, organizational pride mediating the relationships between internal and external CSR perceptions and employee advocacy behavior. Responsible leadership strengthens the effects of internal and external CSR perceptions on organizational pride, as well as the indirect effects of organizational pride on the relationships between internal and external CSR perceptions and advocacy behavior. This study investigates how micro CSR affects advocacy behavior by introducing organizational pride and responsible leadership, thus advancing the micro CSR literature and providing directions for micro-level CSR research. The findings of this research provide guidance to managers by focusing on employee perceptions of CSR activities and organizational pride and by cultivating responsible leadership.

Do green banking practices improve the sustainability performance of banking institutions? The mediating role of green finance

Purpose This study aims to examine the mediating role of green finance in the relationship between green banking practices and the sustainability performance of banking institutions in developing economies. Design/methodology/approach The authors performed an empirical investigation by applying the “partial least squares structural equation modeling (PLS-SEM)” based on a representative sample of 414 bank employees working in the National Capital Region, India. Findings The study’s outcome confirms that employee, top-management, operation and policy related practices substantially influence green finance and banks’ sustainability performance. On the contrary, customer related practices insignificantly influence banks’ sustainability performance. Further, green finance substantially influences the sustainability performance of banking institutions. Practical implications This study shed light on green banking practices that can assist in achieving the vision of the “Clean India Mission” of the Indian government. In addition, it encourages policymakers and bank managers to fulfill their social responsibility by engaging employees and customers in cleaner operations to promote banks’ sustainability performance. Originality/value This is ground-breaking research that enriches the understanding of green banking practices and green finance by providing a novel theoretical framework concerning the sustainability performance of banking institutions. Theoretically, this paper also broadens the scope of corporate social responsibility literature by applying the resource-based view theory in finance and banking.

Mandatory CSR regime strips the competitive advantage: a comparative study of pre-post CSR mandate using the Bandwagon-bias effect theory

PurposeWith corporate social responsibility (CSR) becoming mandatory, several firms in India have been compelled into spending resources on CSR while their business strategy and processes were unprepared to take up CSR activities, effectively. In this light, the CSR relationship with other business functions would be altered. Using Thomson Reuters data from 2010 to 2018 (pre-mandate to post-mandate) this study aims to re-examine the relationship between CSR and financial performance.Design/methodology/approachThe current study is rooted in the bandwagon-bias effect theory and uses a long-term data (2010–2018) of Indian firms. It uses Refinitiv Thomson Reuters ESG rating to measure CSR and accounting measures for financial performance (FP) to make a pre-post analysis of the impact that mandatory CSR regime has had on firms performance. The study uses the weighted panel regression method.FindingsThe relationship between CSR and FP is different when CSR was voluntary than when it has been mandated by Law. CSR has a positive effect over the FP during the voluntary phase but this positive relationship weakens during the mandatory phase. The waning effect of CSR over FP substantiates the presence of bandwagon bias effect which can be explained by the crowding-in of several companies engaged in CSR activities because of the mandatory CSR law.Research limitations/implicationsvFew countries have made CSR mandatory therefore CSR literature is limited. But mandating CSR is a growing phenomenon so this study augments to the body of knowledge. Until now literature generally converged on a positive relationship between CSR performance and FP but the current study shows altering directions to this relationship in a changing CSR environment. The use of the bandwagon-bias theory contributes to the theoretical approaches. Theoretically, the findings add to the body CSR literature and offer impetus to the evolving domain of impact measurement and reporting.Practical implicationsResults of the study offer a clear indication to managers that they need to re-strategise their CSR activities during the mandatory CSR environment if they wish to draw instrumental benefits of a positive impact on the FP of their firms. CSR expenditure is now a leveller so managers may either exceed the mandatory 2% expenditure as some firms did during the voluntary CSR phase or else design their CSR implementation plans to bring about a more impactful positive change. Communicating the impact of CSR to influential and powerful stakeholders beyond the mandatory reporting to the government is yet another way through which managers can draw benefits of CSR activities. Additionally to draw positive results from CSR activities firms may consider adopting international reporting and benchmarking standards such as the GRI and ISO 26000. Finally, the results of the study can be used by policymakers to make a note that the CSR law is causing a weakening of the financial benefits and therefore.Social implicationsThe results of the study can be used by policymakers also need to make a note that the CSR law is causing a weakening of the financial benefits and therefore firms are adopting shortcuts, by donating the required amount of funds. But donation of funds defeats the real purpose of mandatory CSR which is social impact, therefore the regulators may want to make the necessary changes unplug the gaps in the CSR law to ensure better adherence to the law in spirit and a real impact on the ground activities.Originality/valueWhile CSR–FP relationship has been extensively explored but limited studies have explored this relationship in a mandatory CSR environment and no other work presents a comparative view of the CSR–FP relationship, namely, before and after the mandatory CSR policy. The current study is one of the limited few studying the impact of mandatory CSR policy on FP, and the only one that uses the bandwagon-bias effect to explain the phenomenon of weakening impact of CSR on FP of firms. Bandwagon-bias effect has been used in studying consumer behaviour, where group effect impacts behaviour of individuals and with mandatory CSR policy, firms following the other firms leading to crowding in. Using the bandwagon-bias effect has found limited attention from the CSR scholars, the current study uses this theoretical basis and therefore augments the CSR literature.

CSR research in the hotel industry: how it relates to promoting the SDGs

PurposeResearch suggests the hotel industry has grown to integrate corporate social responsibility (CSR) programs towards addressing issues relating to the sustainable development goals (SDGs). Nevertheless, how the progression of research has influenced the field of CSR and the SDGs remains unexplored. This paper aims to address the knowledge gap.Design/methodology/approachThe research is based on a review of 230 papers from Scopus Indexed Journals – both mainstream and specialty. A content analysis was conducted to identify the major themes and the evolution of CSR research in the hotel industry.FindingsRecent CSR research has tended to shift towards issues such as CSR communication and reporting from its earlier focus on the perceptions and practices of CSR. The SDGs, in general, and environmental sustainability, in particular, remain on the periphery of hotel industry’s CSR initiatives. This raises concern about the ability of CSR programs to facilitate the SDGs by 2030. This study highlights that both stakeholders (e.g. consumers, employees) and business forces (e.g. financial bottom line) can shape the hotel industry’s CSR strategies in contributing to the SDGs and greater sustainability.Originality/valueThe research advances the CSR and sustainability literature by undertaking a comprehensive review of business research on CSR in the hotel industry focusing on the SDGs, and advancing and facilitating discussion on existing knowledge in this field and how the field can be further developed.

Senior management mindsets for corporate social responsibility

Despite the large amount of factual data on senior management’s significant role in achieving corporate social responsibility (CSR), little effort has been devoted to shed light on the CSR decision-making process and the managerial mindsets that drive it. To fill this gap in CSR research, this study explores the CSR decision-making process and senior management mindsets regarding CSR, inductively prompted by the CSR literature and a qualitative study. This study offers a conceptual model of socially responsible decision-making based on the Doctus knowledge-based system. The model is empirically analyzed and verified through semi-structured interviews with CSR experts. Further, an inductive examination of the qualitative data using individual-level analysis revealed three different mindsets of senior management towards CSR: conformist, self-interested, and shareholder satisfaction/profit-driven mindsets.

The Effect of Corporate Social Responsibility on Workplace Safety: The Significance of Employees' Moral Identity.

Corporate social responsibility (CSR) has gained significant attention from researchers and practitioners due to its potential impact on employee attitudes and behaviors. This study investigates the influence of CSR on employee safety behavior, examining the mediating effects of job stress and organizational identification, as well as the moderating role of moral identity. We conducted a three-wave time-lagged survey among 236 South Korean employees. Participants were recruited through a research company using stratified random sampling. Data were collected at three time points, each separated by a 4-5-week interval. Structural equation modeling (SEM) was used to test the hypothesized relationships. The findings support all of the hypothesized relationships. CSR was positively related to safety behavior and negatively related to job stress. Job stress was negatively related to organizational identification, which in turn was positively related to safety behavior. The sequential mediation of job stress and organizational identification was significant. Moral identity moderated the relationship between CSR and job stress, such that the negative effect of CSR on job stress was stronger for employees with a high moral identity. This study contributes to the CSR literature by examining the impact of CSR on safety behavior and the underlying mechanisms and boundary conditions of this relationship. The findings suggest that organizations can promote employee safety behavior by implementing CSR initiatives, which can reduce job stress and enhance organizational identification. Organizations should also consider the role of employees' moral identity when designing and communicating CSR initiatives.

The impact of financial analysts’ spirituality on their socially responsible investing decisions: a mediating role of social consciousness

PurposeThis paper aims to contribute to the social aspect of corporate social responsibility literature by examining the influence of financial analysts’ spirituality on their socially responsible investing (SRI) decisions relating to a profitable organization, which is alleged by the media to employ children as laborers in hazardous works in Pakistan. This study also investigates whether analysts’ social consciousness mediates between their spirituality and investing decisions.Design/methodology/approachA scenario-based survey was administered to 124 financial analysts at leading financial institutions in Pakistan. Data were analyzed using regression, analysis of variance and mediation analysis on SPSS 26.FindingsThe findings demonstrate that financial analysts’ spirituality negatively influences their SRI decisions to invest in a profitable organization, which is alleged to employ children in hazardous work that may harm them physically and psychologically. The findings also express that analysts’ social consciousness intervenes in the association between analysts’ spirituality and SRI decisions.Practical implicationsThe findings of this study may interest regulators, multinational firms and researchers in recognizing the importance of individuals’ values for increasing socially responsible investments and addressing social issues such as the exploitation of children.Social implicationsThis study encourages firms to recognize the importance of spiritual and socially conscious corporate conviction while designing strategies and policies. For example, the financial industry may incorporate fundamental personal values such as stewardship, dignity and fairness into its investment plans.Originality/valueThis study provides rigorous insights and contributes to contemporary studies by providing empirical evidence that individuals’ intrinsic values and consciousness drive their judgments.

CSR and ownership structure: Moderating role of board characteristics in an emerging country context

AbstractThe existing literature on the impact of ownership structure on corporate social responsibility (CSR) showed inconsistent results and disregarded the possibility of non‐linear patterns in the relationship. The present study examines the non‐linear relationship between ownership structure (family, foreign, institutional, and government) and CSR expenditure of listed non‐financial service sector firms in India. Further, the moderating effect of board variables, including board size, board independence, multiple directorships and gender diversity, is explored in the ownership structure‐CSR nexus. Based on a balanced panel dataset of 243 non‐financial service sector companies listed in India, the study observed an inverse U‐relationship between institutional ownership and CSR. The study also found that family, foreign, and government ownership positively influence the firm's social engagement. However, the study could find partial support for the moderating role of the four board characteristics; board size, board independence, multiple directorships and gender diversity in ownership‐CSR association. The study contributes to existing CSR and corporate governance literature by exploring one of the major factors (ownership structure) impacting CSR and the role of board variables in the association.

Corporate social responsibility initiatives of banks and customers’ selection of banks in Hong Kong

PurposeThis study examines whether corporate social responsibility (CSR) initiatives positively impact customers’ selection of retail banks in Hong Kong (HK) and identifies which CSR domains affect customers’ selection of banks.Design/methodology/approachThis study adopted a quantitative approach. Primary data were collected from 416 customers of 22 retail banks in HK. The theoretical framework of this study was developed from a literature review, prior studies by Oberseder et al. (2013 and 2014), and CSR initiatives implemented by leading retail banks in HK. Descriptive statistics and statistical tests were used to analyze the data.FindingsThe study found that CSR initiatives positively affect customers’ bank selection. CSR initiatives related to the customer and environment domains are likely to have a greater impact on customers than those related to the society domain and are not likely to significantly impact customers’ bank selection.Originality/valueThis study contributes to the CSR literature by offering enhanced insight into the dynamics of CSR and its effects on customer bank selection. Furthermore, this study tests consumers’ perceptions of CSR initiatives in each CSR domain in the banking sector in Hong Kong – a novel approach that has not been previously explored in existing studies. These findings can help banks review the effectiveness of their CSR initiatives and make informed decisions on which initiatives should pursue improved CSR performance and efficient resource allocation.

Institutional view of corporate social responsibility in the Iranian context

PurposeThe purpose of this study is to examine how formal and informal institutions play a role in the Iranian context in shaping corporate social responsibility (CSR) policies and practices.Design/methodology/approachUsing a multiple case-study approach combining comparative and cross-sectional methods with semi-structured interviews, primary data was collected from eight corporations that actively participated in CSR activities in Iran. A microanalysis approach was used to examine the meanings and dynamics in the data. Through thematic analysis and pattern-matching techniques, the authors separately examined the roles of formal and informal institutions. Cross-case analysis was used to highlight the cases’ similarities and differences.FindingsThis study demonstrates that both formal and informal institutional structures exist in Iran and that both types influence CSR. This study also shows that informal institutions (such as personal values, culture, religion, traditions, charity and philanthropy) play a more explicit role than formal institutions (such as legal regulations and laws) in shaping CSR adoption policies and practices. The results indicate that, among institutions linked to CSR, formal and informal institutions are complementary and potentiate each other in Iran. Nevertheless, compared to formal ones, informal institutions play a more prominent role in shaping CSR policies and practices.Research limitations/implicationsThe authors recognize that, although the eight corporations are large, and although they interviewed their key personnel, they do not claim that these findings are generalizable, owing to the qualitative nature of the study and the small number of selected corporations.Originality/valueThis study makes relevant theoretical and empirical contributions. First, it contributes to the growing body of CSR literature that highlights the necessity of linking informal and formal institutions. Although the CSR literature lacks research on informal institutions in developing economies, researchers have yet to push forward and explore how the CSR adoption process works in developing economies that have influential informal institutions.

Bioethics-CSR Divide

Bioethics-CSR Divide

Generous to a fault: Differential impact of CSR investments on financial gains in Indian market multinationals

To date, the extant Corporate Social Responsibility (CSR) literature has overlooked the performance consequences of different forms of CSR investments made by Emerging Market Multinational Corporations (EMNCs). Addressing this knowledge gap, and drawing on legitimacy theory, we examine the impact of external CSR investments (e.g., social and community philanthropic support activities) and internal CSR investments (e.g., working conditions, employee rights and equal employment opportunities) on financial performance of EMNCs, while also accounting for the moderating effects of internationalization location choices. We test our hypotheses on a panel consisting of 1513 unique Indian EMNCs, in the 2014–2019 time-period. On applying various estimation techniques, the findings reveal that both external and internal CSR investments are positively associated with financial performance of EMNCs, while the destination location of foreign investments and home-host geographic and institutional distance moderate these relationships. This study offers new empirical evidence on the financial implications of different types of CSR investments available to EMNCs and advances legitimacy theory by expanding its dimensional and contextual scope.