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A COMPARATIVE ANALYSIS
OF THE CORPORATE PLANET
ILLUSTRATE PORTRAYALS OF CORPORATE SOCIAL RESPONSIBILITY:
PRESENTATION OF RESEARCH THESIS
Swati Bhatia
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THESIS STRUCTURE
What is it?
CSR on its way to Europe,America & India
CSR in comparative perspective
Implicit CSR and explicit CSR as complimentaryelements of CSR
Implications for a research agenda in CSR
a. Implicit CSR and National Business Systemsb. Explicit CSR and the global diffusion of management
concepts
Conclusions
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WHAT IS IT?
Good question. As the Gaia of business, corporate socialresponsibility (CSR) seems to have attained all the holisticmystery of a Hollywood new-age religion. And since there arealmost as many definitions of CSR as there are companies who
say theyre doing it, the European Commissions take seems asgood as any. Brussels bureaucrats define CSR as a conceptwhereby companies decide voluntarily to contribute to a bettersociety and a cleanerenvironment.CSR has also been described as business contribution tosustainable development (meeting the needs of today withoutcompromising the needs of future generations). The idea is thebusiness has a duty to its wider community beyond stayingwithin the law and satisfying stakeholders
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CORPORATE SOCIAL RESPONSIBILITYas an european concept
The evolution of the concept of CSR and the related issues ofsocial and environmental accountability can be seen as theresult of two parallel paths; one encompasses the efforts ofpolicy makers and organizations to spread the idea of socially
responsible behaviour and CSR practices through initiatives,formal definitions and so on. The other path includes academicsresearch, which has progressed from an initial, vagueawareness of the relationship between companies and social /
environmental issues to the identification of a more defined setof management tools and rules of conduct
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CORPORATE SOCIAL RESPONSIBILITYas an american concept
The American concept of corporate social responsibility meansthat organizations have moral, ethical, and philanthropicresponsibilities in addition to their responsibilities to earn a fairreturn for investors and comply with the law. A traditional view of
the corporation suggests that its primary, if not sole,responsibility is to its owners, or stockholders. However, CSRrequires organizations to adopt a broader view of itsresponsibilities that includes not only stockholders, but many
other constituencies as well, including employees, suppliers,customers, the local community, local, state, and federalgovernments, environmental groups, and other special interestgroups. Collectively, the various groups affected by the actionsof an organization are called "stakeholders." The stakeholder
concept is discussed more fully in a later section.
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CORPORATE SOCIAL RESPONSIBILITYas an indian concept
Gandhi was a person who in several respects was ahead of histime. His view of the ownership of capital was one of trusteeship,motivated by the belief that essentially society was providingcapitalists with an opportunity to manage resources that should
really be seen as a form of trusteeship on behalf of society ingeneral. Today, we are perhaps coming round full circle inemphasizing this concept through an articulation of the principleof social responsibility of business and industry.
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CSR in comparative perspective:rights and status of employees
Working conditions, working time or benefits are dominanttopics in the area of CSR in the American context
US example: since 2004 Starbucks Coffee provides a basichealth insurance for all franchisees working more than 20
days/month Social security of employees in Europe is typically subject to
numerous laws and regulations and embedded in a welfarestate approach
UK: default health insurance through National HealthService (NHS)
Germany: membership in health insurance is mandatory(gesetzliche Krankenversicherung); employers contributionto the monthly premium is defined in the law
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CSR in comparative perspective:genetic engineering
Laisser faire approach of Federal Drug Agency and USDepartment of Agriculture; EU-Commission is ratherconservative (Vogel 2002)
Until 2002: 58 GMOs were released in the US; only 18 in EU;1999: 60% of food in US contains GMOs
Significant differences in the risk percepton of GMOs (1998):14% anti in US, 65% in Sweden, 50% in Germany, 39% inUK
2000: as part of the CSR policies, McDonalds, Gerber andMcCain issue voluntary self-commitment not to use GMOs
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CSR in comparative perspective:education
Second most important CSR issue for US companies; nosignificance for companies NL or F (Maignan & Ralston 2002)
Corporate donations to education in US in 1998: $ 3.25bill (+
3.8bill from foundations such as Ford, Carnegie etc.)
Most European education systems rely heavily or evenexclusively on state money
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CSR AS AGGREGATE OF IMPLICIT ANDEXPLICIT ELEMENTS
Social salience
of a CSR issue
European CountriesUSA
CSR as an explicitelement of corporate policies
Intensity of the institutional
framework
CSR as implicit element of theinstitutional framework
of corporations
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IMPLICIT AND EXPLICIT CSR:THE EXAMPLE OF HEALTH CARE
Social salience
of a CSR issue
European CountriesUSA
Intensity of the institutional
framework
Implicit CSRHealth insurance courtesyof Starbucks Coffee
Health insurancein the NHS
Explicit CSR
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IMPLICIT AND EXPLICIT CSR:THE EXAMPLE OF GMOs
Social salience
of a CSR issue
European CountriesUSA
Intensity of the institutional
framework
Implicit CSR
Explicit CSR
Risk averseregulatory approach
of EU CommissionMcDonalds voluntarilyrefrains from GMOs
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DEFINITION OF CSRAS A DUAL CONSTRUCT
Explicit CSR Implicit CSR
Describes all corporate activities toassume responsibility in society
Describes all formal and informalinstitutions of a society which assign and
define the extent of corporateresponsibility for the interests of an entire
society
Consists of voluntary corporate policies,
programs and strategiesConsists of values, norms and ruleswhich result in (chiefly codified and
mandatory) requirements for corporations
Motivated by the perceived expectations
of all stakeholders of the corporationMotivated by the societal consensus onthe legitimate expectations towards therole and contribution of all major groups
in society, including corporations
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Implicit CSR and the National BusinessSystems-approach (Whitley)
Historically grown institutional framework of a country
Political system
Financial
system
Education and
Labour system Cultural system
National Business System
Nature of the firmOrganization of market
processes
Authoritativecoordination andcontrol systems
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NBS approach as a framework for researchinto implicit CSR
30 years of established research tradition in comparativeresearch in Europe (e.g. Sorge, Maurice, Whitley, Kristensen,Clark, Child, Kieser, Lane)
Conceptualization of divergent models of capitalism in EuropeAnglo-saxon (GB, IRL)
Nordic (SF, S, N, DK)
Rhenish (D, F, CH, A, NL, LUX, B, I, ES, P)
Eastern European (PL, H, CZ, SK, SLO etc.)
Key finding that NBS only change slowly over time if at all
Allows for research into national systems of CSR
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Implicit CSR and European National BusinessSystems
Stronger role of the state in risk sharing and coordination of theeconomy
Relatively minor role of capital markets.
Highly regulated markets for labour
Powerful position of trade unions and industry associations
Trust and authority relations in the model of the rhenish
capitalism (Albert 1991)
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Explicit CSR andNeo-Institutionalism
Organizational fields as those organizations that, in theaggregate, constitute a recognized area of institutional life: keysuppliers, resource and product consumers, regulatory agencies,and other organizations that produce similar services and
products (DiMaggio and Powell 1983).New, rational organizational practice occurs because it isregarded as legitimate within the organizational field (Meyerand Rowan 1977, Scott 2001).
Neo-Institutionalism explains the global diffusion of managementconcepts and practices beyond national or industry borders(Business Re-engineering, ISO 9000, Lean Management, TQMetc.; Meyer 2000).
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Ligitimacy of managementpractice through ...
Coercive Isomorphismsexternal rules, demands, expectations, norms, laws which haveto be respected to avoid sanctions of loss of trust
Mimetic Processesincreasingly complex technologies, goal ambiguities anduncertainty causes managers to just imitate best practices
Normative Pressuresprofessionalization of the management craft by way of anincrease in formal degrees and global networks, especially in thecontext of professional and ecucational associations and industryassociations.
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Peculiarities of European explicit CSR
Pivotal role of regulating/governmental bodies
Multistakeholder-approach (government, industry associations,trade unions, NGOs)
Corporate involvement in regulatory processes (z.B. Polder-model, self-commitments)
Dominant role of ecological/environmental issues
Philanthropy only of marginal importance
Secular approach
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CONCLUSIONS......Implications of the proposed framework
Descriptive implications: CSR has different contents, meaningsand connotations depending on the institutional and nationalcontext
Instrumental implications: corporate CSR has to be adapted toand contextualized in a specific institutional and nationalenvironment
Normative implications: revisiting the core assumptions of CSRin the Anglo-Saxon debate, which sees CSR (that is: explicitCSR) as an approach to locate social responsibilities ofcorporations which is better and more appropriate thancollective, regulatory solutions to the problem (that is: implicitCSR)
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CSR in worldwide:Back to the research questions
Why was CSR not discussed in Europe before? European companies have ever been socially responsible;
however, they
did not use the label of CSR for this;
practiced CSR as a natural/self-evident response to theinstitutional framework of business.
What are the reasons that CSR is becoming an issue now?
CSR gets on the agenda in India now because
Globalisation confronts Indian and other MNCs with contextswhich institutionalize social responsibility in a different wayfrom their respective home countries;
Changes in the organizational field of companies popularise
CSR as a management idea.
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REFERENCES
Albert, M. 1991. Capitalisme contre capitalisme. Paris: LeSeuil.Bondy, K., D. Matten & J. Moon. 2004. 'The Adoption of VoluntaryCodes of Conduct in MNCs - A Three Countries Comparative Study'Business and Society Review, 109:4, 449-477.
Carroll, A.B. 1999. Corporate social responsibility - evolution of a
definiti-onal construct. Business & Society, 38(3): 268-295.Carroll, A.B., & Buchholtz, A.K. 2002. Business & society : ethics andstakeholder management (5. ed.). Cincinnati, Ohio: South-WesternCollege Pub./Thomson Learning.
Child, J., & Kieser, A. 1979. Organization and managerial roles inBritish and West German companies: An examination of the culture-free thesis. In C.J. Lammers, & D.J. Hickson (ed.), Organizationsalike and unlike: Inter-national and inter-institutional studies in thesociology of organizations: 251-271. London: Routledge.
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