Arguably, the corporate social responsibility practices of multinational enterprises are influenced by a wide range of both internal and external factors. Perhaps, most critical among the exogenous forces operating on MNEs are those exerted by state and other key institutional actors in host countries. Crucially, academic research conducted to date offers little data about how MNEs use their CSR activities to strategically manage their relationship with those actors in order to gain legitimisation advantages in host countries. This paper addresses that (...) gap by exploring interactions between external institutional pressures and firm-level CSR activities, which take the form of community initiatives, to examine how MNEs develop their legitimacy-seeking policies and practices. In focusing on a developing country, Sri Lanka, this paper provides valuable insights into how MNEs instrumentally utilise community initiatives in a country where relationship-building with governmental and other powerful non-governmental actors can be vitally important for the long-term viability of the business. Drawing on neo-institutional theory and CSR literature, this paper examines and contributes to the embryonic but emerging debate about the instrumental and political implications of CSR. The evidence presented and discussed here reveals the extent to which, and the reasons why, MNEs engage in complex legitimacy-seeking relationships with Sri Lankan host institutions. (shrink)

Business Ethics: A European Review, EarlyView.

Multinational companies (MNCs) frequently adopt corporate social responsibility (CSR) activities that are aimed at providing ‘public goods’ and influencing the government in policymaking. Such political CSR (PCSR) activities have been determined to increase MNCs’ socio-political legitimacy and to be useful in building relationships with the state and other key external stakeholders. Although research on MNCs’ PCSR within the context of emerging economies is gaining momentum, only a limited number of studies have examined the firm-level variables that affect the extent to (...) which MNCs’ subsidiaries in emerging economies pursue PCSR. Using insights from resource dependence theory, institutional theory, and the social capital literature, we argue that MNCs’ subsidiaries that are critically dependent on local resources, have greater ties to managers of related businesses and to policymakers, and that those that are interdependent on the MNCs’ headquarters and other foreign subsidiaries, are more likely to be involved in PCSR. We obtain support for our hypotheses using a sample of 105 subsidiaries of foreign firms that operate in India. Our findings enhance our understanding of the factors that determine MNCs’ political CSR in emerging economies. (shrink)

In view of the limited consideration for Afrocentric perspectives in organisational ethics literature, we examine Employee-Centred Corporate Social Responsibility from the perspective of Afrocentric employees’ social expectations. We posit that Afrocentric employees’ social expectations and the organisational practices for addressing these expectations differ from conventional conceptualisation. By focusing specifically upon the psychological attributes evolving from the fulfilment of employees’ social expectations, we argue that Afrocentric socio-cultural factors could influence perceived organisational support and perceived employee cynicism. We further draw upon social (...) exchange theory to explore rational reciprocity evolving from the fulfilment and breach of employees’ social expectations at work. Contrary to the rational norm of reciprocity, we identify a reciprocity norm within which the breach of employees’ social expectations could in fact engender positive reciprocity rooted in esan reciprocity ideology—an ideology that emerged from the ethical tradition of the Yoruba people from Nigeria, West Africa. Overall, our paper elucidates the implications of Afrocentric peculiarities for employees’ social exchange within the African workplace, thus extending the present understanding in this regard. (shrink)

The Panama Papers (2016), Paradise Leaks (2017), and Pandora Papers (2021) have revealed the extensive practice of corporate tax avoidance. Yet, the tax behavior of companies claiming to be “socially responsible” has been less examined. This study examines the association between corporate social responsibility disclosure (CSRD) and tax avoidance, particularly in developing economies, focusing on Sub-Saharan Africa (SSA). By analyzing data from 600 firm-year observations across 13 SSA countries using panel quantile regression, we found a negative relationship between CSRD, which (...) includes ethical, social, and environmental dimensions, and tax avoidance. This aligns with legitimacy theory, indicating that firms are increasingly adopting CSR transparency to meet societal expectations and gain stakeholder trust, avoiding socially irresponsible behaviors. Furthermore, the quality of national governance significantly moderates the CSRD–tax avoidance relationship, supporting the concept of institutional isomorphism. This evidence is valuable for professionals and policymakers and encourages further research to deepen and broaden these findings. (shrink)