...Executive Summary This report focuses on the effects on corporate social responsibility (CSR) on MNC from a theoretical point of view by explaining the principles of the CSR in the MNC in a business strategy, identifying the challenges faced by the company in introducing the CSR practice and recommendation by ensuring its effective growth introduction to the company. Corporate social responsibility (CSR) helps MNCs to work in a way which accept ethical way and also contribute to the economic growth and improvethe employees living environments, the smaller society and the bigger society. Multi-national companies can help for CSR in developing countries.The principle of CSR is as a result of globalisation. For centuries, globalisation has been a trend that has knitted people together; this can be traced back to the ‘trade by barter’ system. As civilisation evolved, globalisation began to have more effect and thus implementing CSR. Globalisation has its impacts, both positive and negative on businesses, families, individuals, communities and nations. It is believed that CSR is a means of highlighting the positive impacts of globalisation. Introduction Corporate social responsibility is defined as operating a business in a way that helps for the social and social and environmental effect created by the business organisation. Corporate social responsibility (CSR) helps MNCs to work in a way which accept ethical way and also contribute to the economic growth...
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...thesis I would like to contribute on the on-going CSR discussion. I attempt to investigate the real motives why multinational corporations engage in corporate social responsibility activities. The debate in CSR is nowadays still focused on the link between CSR and financial performance. Research lacks real proof of this link and corporations are failing in formulating a business case. So why is it that MNCs are willing to engage in CSR activities. In the following thesis I would like to give an answer on this question. Inhoudsopgave 1. Introduction 5 1.1 Research Purpose 6 1.2 Problem Statement 6 1.3 Sub questions 7 1.4 Structure 7 2. Theory 8 2.1 Definition CSR 8 2.2 Definition Multinational Corporation (MNC) 9 2.3 Theoretical Framework (Garigga & Mele (2004)) 10 2.3.1 Instrumental theories 10 2.3.2 Political theories 12 2.3.3 Integrative theories 13 2.3.4 Ethical theories 14 2.3.5 Propositions 16 3. Methods 18 3.1 Research approach 18 4. Results 19 4.1 Instrumental motive 20 4.2 Political motive 20 4.3 Integrative motive 21 4.4 Ethical motive 22 5. Conclusion & Recommendation 24 5.1 Conclusion 24 5.2 Limitations & Recommendation 27 6. References 28 1. Introduction Corporate social responsibility is becoming more and more important for companies. The last few years there is an increase of interest from companies in CSR and in the implementation of different CSR activities in their day-to-day businesses. In general...
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...Profit—Global Perspective Multinational corporations perform business with the aim of making profits. However, such corporations are expected to be socially responsible for upholding the well-being of the society. The welfare of the society is upheld by carrying out commitments that contribute to the sustainable economic development of all members of the society (Patton, 1994). This paper looks at the best and the worst MNC in CSR by describing and contrasting them. Moreover, this paper evaluates their practices and consequences regarding their CSR. Part 1 After carrying out a survey on the best MNCs, Forbes cited Google as the overall MNC with the best reputation in CSR. Rep Trak Company, which revealed that Google has maintained this position since 2010, did this ranking in 2014 (Dill, 2014). Google uses a corporate slogan that embraces the philosophy of CSR. ‘Don't be evil' Slogan states in a few words what the company does for the society (Corporate Social Responsibility – Company – Google, n.d.). This survey that ranked Google as the top company in CSR evaluated 100 MNCs regarding the emotional and rational responses of the respondents. Google topped in the two areas. In emotional response, Google was found to be highly esteemed, admired, and trusted. In the rational responses, Google was found to be the best in leadership and performance classification. Moreover, it was found to be offering the best product and services, with highly innovative citizenship. Furthermore, goggles...
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...Corporate Social Responsibility (CSR) is often defined as a process company self-regulating themselves from doing activities that against the law and the ethical standard (Lange and Washburn 2012). CSR encourage the company that all the company’s activities provide positive impact to their customer, environment, communities, and also shareholders (Fassin 2012). The CSR process is important to Multinational Corporation (MNC). MNC is a corporation that they registered their company in more than one country and has been operate in more than one country. It can be also called as International Corporation (Bucheli and Kim 2012). The established of MNC helps both the host country and home country. For the host country, due to the operation of MNC, the investment level, employment level and income level increase. Other than that, the latest technology will be introduced in the host country by the MNC(Girma and Gorg 2007).. There are also chances to increase the business of those domestic trader and market intermediaries (Daniel, Sorinel and Sorin 2010). While for the home country, the country will get the chance to marketing their products throughout the world. Other than that, MNC also create employment opportunities to the people of home country (Brikinshaw, Hood and Johnson 1998). In the other hand, MNC also brings disadvantages to both host country and home country. Instead of introducing the latest technology in the host country, MNC may use the technology that has been outdated...
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...CHAPTER 01: MANAGING INTERDEPENDENCE Social Responsibility and Ethics THE SOCIAL RESPONSIBILITY OF MNCs Multinational corporations (MNCs) and multinational enterprises (MNEs) have been, and to be, at the center of debate regarding corporate social responsibility (CSR), especially in less developed countries (LDCs). CONGA in Peru for instance. The criticisms of MNCs have been lessened in recent years by the decreasing economic differences among countries, by the emergence of less developed countries' (LDCs) multinationals, and by the greater emphasis on social responsibility by MNCs. it is clear that there are long-term competitive benefits deriving from Corporate Social Responsibility CSR, much of which results from the goodwill, attractiveness, and loyalty of the various stakeholders connected with the company. MNC Stakeholders Home Country Owners Customers Employees Unions Suppliers Distributors Strategic allies Community Economy Government Host Country Economy Employees Community Host government Consumers Strategic allies Suppliers Distributors MNC Society in General (global interdependence/standard of living) Global environment and ecology Sustainable resources Population’s standard of living While making good faith efforts to implement CSR, companies operating abroad face confusion about the cross-cultural dilemmas it creates, especially how to behave in host countries, they have their own differing expectations and agendas. Recommendations about how...
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...Pollution prevention describes activities that reduce the amount of pollution generated by a process, whether it is consumer consumption, driving, or industrial production. Pollution control is a term used in environmental management. It means the control of emissions and effluents into air, water or soil. Without pollution control, the waste products from consumption, heating agriculture, mining, manufacturing, transportation, and other human activities, whether they accumulate or disperse, will degrade the environment. In the hierarchy of controls, pollution prevention and waste minimization are more desirable than pollution controls. In the field of land development, low impact development is a similar technique for the prevention of urban runoff. Pollutants, the components of pollution, can be either foreign substances/energies or naturally occurring contaminants. Pollution is often classed as point source or nonpoint source pollution. Air pollution, light pollution, noise pollution, soil contamination, radioactive contamination, thermal pollution, and visual pollution and water pollution. Pollution has been found to be widely in the environment. Research indicates that living in areas of high pollution has serious long term health effects. Living in these areas during childhood and adolescence can lead to diminished mental capacity and an increased risk of brain damage. People of all ages who live in high pollution areas for extended periods place themselves at increased...
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...387 From supply chains to value chains: A spotlight on CSR Malika Bhandarkar and Tarcisio Alvarez-Rivero* 1. Introduction Corporate social responsibility (CSR)1 has become a hot topic in boardrooms across the world. Changes in corporate value systems are being driven by pressures from different actors, including governments, consumers, non-governmental organizations (NGOs) and institutional investors (diagram 1). Multinational corporations (MNCs) have operations spread across the globe, relying on both foreign affiliates and arm’s-length suppliers arrayed along global supply chains, many of which encompass developing countries. What then does the growing CSR movement mean for developing country producers? The chapter addresses this question. Diagram 1 Institutional Investor Tier I Tier II Tie r III NonGovernmental Organization Multinational Corporation Supply Chain, consisting of: Consumer Government CSR has relevance to many facets of a corporation’s operations. Strong CSR policies can help to recruit the right people for the job, keep attrition rates low by promoting a “feel good” quotient, improve corporate image, prepare for future regulation, empower “soft” laws (Vogel, 2005, p.162), appease green customers, and convince institutional investors that the corporation is following sustainable practices that positively impact the bottom line. * Policy Integration and Analysis Branch, Division for Sustainable Development, UNDESA...
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...There are no universal or International Standard of what is right or wrong because of the cultural differences among the countries. For example, some country appreciate child labor but some country has a strict law of child labor. So when a business organization conducts business in another country, they are trying to take advantage of that country. The reason for an organization to do business beyond the border is to maximize their profit. Sometimes some MNC does offshore or outsourcing to get the job done. So some MNC goes to the third world country to gain economies of scale. For example Apple Inc. Products are produced by a third party independent manufacturer Foxconn, which situated in China. They have some controversies about some unethical human rights issues which brings public attention. Even though Foxconn produce apple inc. products. But Apple Inc. Face any loss for that. So Yes, the use of third party independent contractors insulate MNC from being attacked by the customer for ethics. Yes, this practice would offer MNCs a good defensive...
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...responsibility (CSR) over time has expanded its influence to many enterprises and concerned organizations, required those must consider how their activities affect the surrounding society such as communities (human rights, labor issues,...), environmental protection,… World Business Council for Sustainable Development (WBCSD, 1999) as cited in Wong & Ahmad (2010) gave the most common definition of CSR as: “the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large”. From Jamali’s (2008) perspective, CSR is concerned with the guarantee of corporations to contribute to the development, enhancement of society and stakeholder interests. There are also different views of CSR between the ownership concentration (Dam & Scholtens, 2013) and stakeholders’ welfare. CSR has become more and more important issue as the world is turning “flatter”, not only considering in developed countries but also in developing ones like Vietnam. However, there are some barriers to implementing an effective CSR program for an international organization operating in Vietnam (Tencati, Russo, & Quaglia, 2010). The Effects Of CSR On International Business Recent years, CSR has become an essential requirement for doing business for most of the companies in the world, especially those multinational corporations (MNCs). According to...
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...critical importance. The motivations for these contracts are continuously being revisited to understand how CSR programs can nurture and contribute to the growth of firms. While CSR issues are attracting a great deal of attention in the developed world, there is a need for more research into CSR in the developing world. This paper considers the CSR practices of a small sample of multinational corporations (MNCs) and local firms in Bangladesh to better understand this situation. Introduction Corporate social responsibility (CSR) has generated significant debate in academic and corporate circles in recent times. This debate acknowledges the importance of CSR in the first-world, but raises questions regarding the extent to which corporations operating in developing countries have CSR obligations (Jamali and Mirshak, 2007). Conventional wisdom suggests that CSR is more relevant to corporations operating in the developed countries due to elevated community expectations of socially responsible behaviour. In contrast there is also a belief that societal expectations in the developing countries mainly centre on economic growth; therefore relegating CSR to be of lesser importance to the society and the firms (Khan, 1985). Against this back drop, this paper discusses the situation prevailing in the developing world to broaden our understanding of the perceptions and practices of CSR. Bangladesh is used as a test case for this purpose because this country is believed to posses the typical...
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...responsibility of businesses has become an important part of today’s business agenda. The paper aims to investigate the corporate social responsibility of business: Grameenphone in Bangladesh and identify different Corporate Social Responsibility (CSR) activities of Grameenphone (GP). Secondary data collection methods were used to conduct the study. It can be concluded GP believe that sustainable development can only be achieved through long term economic growth and therefore, intended to deliver the best to the customers, business partners, stakeholders, employees and society by ‘being a partner in development. Introduction: Business houses, right from the inception of human race, have been regarded as constructive partners in the communities in which they operate. Though they have been instrumental in creating employment, wealth, products and services, yet the pressure on business to play a role in social issues involving employees, stakeholders, society, environment, government etc. is continuously increasing. In response to it, the organizations around the globe are forced to wake up to the need for being committed towards Corporate Social Responsibility. Over the years this concept of Corporate Social Responsibility (CSR) has gained unprecedented momentum in business and public debate and has become a strategic issue crossing the departmental boundaries, and affecting the way in which a company does business. It has become so important that many organizations have...
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...and practice as companies strive to expand their products, services, sales, and operations throughout the world. Regardless of what is happening in individual countries, whether at home or abroad, the primary venue for ethical debates in the future will more and more be the world stage. The primary venue for ethical debates in the future will more and more be the world stage. Globalization characterizes the international setting of business transactions in which U. S. and world multinational corporations (MNCs) will increasingly participate over the next several decades. Despite setbacks such as the attacks upon the World Trade Center in 2001 and the antiglobalization backlash that continues to be seen at major international meetings of the World Trade Organization, International Monetary Fund, and global summits such as the G8 summits, the global economy is irresistible to MNCs, and little will impede the trend toward global capitalism. The explosive growth of MNCs has set the stage for global business ethics to be one of the...
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...in this or similar situations? Domestic companies and multinational companies have responsibilities that portray their corporate and social stance as an organization. Many of these responsibilities are indicated in the vision or mission statement. Ethical and socially responsible conduct should be the cornerstone of any organization’s core values and strategic management process (Godiwalla & Damanpour, 2006). For an MNC, ethical and social responsibility charge becomes an imperative because it is globally conspicuous, and, its activities have global impact and ramifications (Godiwalla & Damanpour, 2006). An MNC’s activities whether they are the pursuit of rapid growth, increased market share and profits, and competitive performance, should emanate its core ethical values and socially responsible vision. A MNC’s responsibility should stem beyond financial targets and in addition focus on the well being of people, communities and the environment. A company that has a strong social responsibility statement is Diageo. Diageo is one of the top ten MNCs and is the world's largest producer of spirits and a major producer of beer and wine (SiliconIndia, 2012). Diageo's brands include Smirnoff, Johnnie Walker, Baileys and Guinness (SiliconIndia, 2012). It is also the exclusive international distributor of Jose Cuervo and owns 34 percent of Moet Hennessy, which owns brands including Moet & Chandon, Veuve Clicquot and Hennessy (SiliconIndia, 2012). As a company in an industry...
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...‘Corporate Social Responsibility’ (CSR) refers to a form of corporate self-regulation integrated into a business model, which usually involves active compliance with the law, ethical standards, and international norms. This theory aims to achieve positive impacts on the environment, consumers, employees, and the communities. Under the force of globalization, this theory has been challenged by the diminishing different roles of the government and firms, especially when the power of multinational companies is rising. Most corporations, especially multinational corporations (MNCs) have already adopted CSR policy despite the fact that there are still debates over the concept. Under globalization, states power has weakened whereas the power and influence MNCs have significantly strengthened, making them become more state-like. This expansion of role played by MNCs in society has urged the rise of concern groups to pressurize on them to take up more social responsibility. As Amaeshi, Osuji and Nnodim (2006) argues, although the MNCs do not bear legally any responsibilities for the practices of its suppliers, they have a deontological duty to use power responsibly and influence the weaker parties by setting codes of conduct and standards. In electronics industries, as Good Electronics, a Dutch-origin concern group on human rights issue in electronics, has stated that the lack of effective regulations and inadequate corporate CSR initiatives have caused exploitation...
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...Chapter 1 -The global manager’s environment Sources of Risk for International Managers -Exogenous- General environmental factors, industry-related uncertainties and some firm-specific uncertainties. -Endogenous- Uncertainties that arise from within the firm, and include managerial perceptions, attitudes and organizational perspectives. -Top two exogenous risks facing business leaders and policy makers for 2012 and the next decade would be severe income disparity (The unequal distribution of household or individual income across the various participants in the economy) and chronic fiscal imbalances (situation where all of the future debt obligations of a government are different from the future income streams) -Other issues: natural disasters such as 2011 earthquake in Japan, flood in Thailand, Political uncertainty in China and Middle East -Globalization has compounded the types and level of business risks. *Typical challenges that managers face involve politics, cultural differences, global competition, Terrorism and Technology. Managers in companies are struggling to find ways to balance their social responsibilities, their images, and their competitive strategies. -PESTEL- An analytical tool to develop and understanding of exogenous risk -Pestel analysis- Political, Ethical, Social, Technological, Environmental and legal understanding or environmental scanning that is CRITICAL if we are to strategically plan and develop our value proposition. -> Exogenous creates...
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