CSR in the context of globalisation

CSR is about companies taking a societal responsibility, from a financial, environmental and social perspective. A lot of research knowledge has been developed regarding CSR in the context of high-income countries. Despite that its practice differs across countries, relatively little is known about CSR when it comes to low- and middle-income countries.

”Social and environmental issues, which are major issues of societal concern in developing countries, are a key feature of my research”, says Gideon Jojo Amos, PhD student at the School of Business, Engineering and Science at Halmstad University, Sweden.

'Why' and 'how' affect

Firms originating from high-income countries have investments in the extractive industries in African countries, including South Africa, Nigeria and Ghana. The focus in this study is the mining industry sector in Ghana. Gideon Jojo Amos has studied the influence on multinational corporations’ (MNCs) CSR related behaviour when they internationalise and enter markets in developing countries. The PhD thesis explores the question of ‘why’ and ‘how’ differences in institutional environments, which take into consideration institutions (i.e. formal rules and regulations) and contextual issues such as informal rules and taken-for-granted cultural frameworks and social norms, affect the use of CSR.

Regardless of whether one accepts or rejects the premise on which CSR is anchored, the fundamental issue is that businesses have obligations to society that go beyond profit-making to include helping to solve societal and environmental problems, Gideon Jojo Amos points out. And this contention is particularly relevant and crucial in the context of low- and middle-income countries.

A lot to do for researchers

”If you read literature about CSR you find that a lot has been done in terms of understanding how CSR works in practice in, for example, Europe or North America. Researchers, therefore, need to go that extra mile to investigate what happens in low- and middle-income countries.”

It is interesting to explore, for example, the challenges and opportunities that often arise when firms with their origin in high income-countries internationalise and enter markets in low-income countries.

The ‘drivers’ of CSR expectations in the local host communities are very much context dependent, Gideon Jojo Amos points out. Regulative, normative, and cultural-cognitive elements work together to explain or predict the actions of mining companies, as well as the expectations from the host communities.

”And if regulations relating to CSR are relaxed in order to induce foreign investment, or regulators do not monitor firms’ behaviour and enforce regulations, social norms and values and expectations in the host communities play a key role in defining how firms will behave in order to, for example, protect the host communities from the environmental effects of mining.”

The 'energising effect'

The findings in the thesis indicate that CSR rhetoric – the information about how the company works with CSR – plays a more positive and significant role than so far revealed in CSR research.

”Thus, CSR rhetoric incentivises or induces the host communities to push for the fulfilment of their CSR expectations and initiatives proposed by the mining companies. This is what I have described as the ’energising effect of CSR rhetoric’.”

Text: Kristina Rörström
Photo: iStock (top photo) and Kristina Rörström