Corporate social responsibility (CSR) – insights from South Asia

Tassilo Schuster (Department of International Management, Friedrich-Alexander-University of Erlangen-Nürnberg, Nürnberg, Germany)
Peter Lund-Thomsen (Department of Intercultural Communication and Management, Copenhagen Business School, Frederiksberg, Denmark)
Bahar Ali Kazmi (Work & Organisational Psychology Group, Aston Business School, Birmingham, UK)

South Asian Journal of Global Business Research

ISSN: 2045-4457

Article publication date: 16 June 2016

3726

Citation

Schuster, T., Lund-Thomsen, P. and Kazmi, B.A. (2016), "Corporate social responsibility (CSR) – insights from South Asia", South Asian Journal of Global Business Research, Vol. 5 No. 2. https://doi.org/10.1108/SAJGBR-03-2016-0020

Publisher

:

Emerald Group Publishing Limited


Corporate social responsibility (CSR) – insights from South Asia

Article Type: Guest editorial From: South Asian Journal of Global Business Research, Volume 5, Issue 2.

Growth in cross-border trade, off-shoring, outsourcing, and global capital flows have transformed the role of business organizations in society (Mayer and Gereffi, 2010; Doh et al., 2010; Jamali et al., 2015a). Increasingly, business organizations are required to contribute to environmental protection, human rights, and poverty alleviation. The term CSR is often used to represent this new role of business organizations which has evolved into a global phenomenon spanning both developed and developing economies (Jamali and Mirshak, 2007; Jamali et al., 2015b). Various international and local policy and semi-legal frameworks such as the OECD Guidelines on Multinational Enterprises, the Millennium Development Goals, and the United Nations Global Compact or the Indian Ministry of Corporate Affairs National Voluntary Guidelines on Social, Environmental, and Economic Responsibilities of Business legitimize this new global social and environmental role of business organizations (Lim and Tsutsui, 2012).

In the global context of CSR, South Asia[1] has recently attracted greater interest among business leaders, politicians, and academics alike. First, South Asia has become one of the most dynamic and fast-growing regions in the world and one which many multinational companies consider as an important strategic growth market for their business activities. This can be seen through investing in local production facilities and integrating domestic companies into their value chains. Today, foreign direct investment in South Asia is nearly 200 times higher than in 1990, a time when economic liberalization began in numerous countries throughout the region (UNCTAD, 2014). Additionally, we have witnessed a strong increase of outward foreign direct investment from South Asia with many South Asian multinationals now operating on a global scale (Khilji, 2012).

The interest in South Asian countries is also driven by the emergence of contextual approaches to management which are being used to highlight the role of culture, religion, institutions in shaping CSR both in developed and developing countries (Azizi and Jamali, 2016, this issue, Campbell, 2007; Jamali and Mirshak, 2007; Matten and Moon, 2008). As a consequence, it has been argued that a range of contextual approaches to CSR are needed to induce positive social changes and environmental sustainability. Increasingly, the cross-country research highlights the significance of – historical, temporal, institutional, cultural, and industrial contexts – as both a source of defining CSR as well as an initial condition for enacting it (see, e.g. De Abreu et al., 2012; Gond and Moon, 2011; Dartey-Baah et al., 2015; Mark-Ungericht and Weiskopf, 2007; Matten and Moon, 2008; Muthuri and Gilbert, 2011; Visser and Tolhurst, 2010). Some business leaders and academics also highlight the influence of religion on CSR and argue that socially responsible business behaviors often represent the religious beliefs such as Hinduism, Buddhism, and Islam (Muniapan and Satpathy, 2013; Sharma et al., 2009; Tideman, 2016, this issue).

Given the importance of South Asia, it is not surprising to observe the growing interest of CSR scholarship in the countries of South Asian region (Chapple and Moon, 2005, 2007). The research, in particular, provides insights into specific socially responsible practices of both foreign multinationals and local companies, and highlights their impact on poverty alleviation (Arora and Kazmi, 2012; Gupta and Khilji, 2013; Mezzadri, 2010; Prahalad, 2006; Schuster and Holtbrügge, 2012, 2014; Venn and Berg, 2013), inadequate labor standards (Lund-Thomsen and Nadvi, 2010a, b; Mezzadri, 2012), human rights violations (Gupta et al., 2010), caste-based discrimination (Thorat and Neuman, 2012; Thorat and Newman, 2007), approaches to addressing child labor in global supply chains (Husselbee, 2000; Kazmi and Macfarlane, 2003), and on the lack of workplace safety in the organized and informal sector (Pingle, 2012). Scholars also have explored the localized perspective(s) on CSR. Some argue that CSR initiatives of Indian companies are barely embedded in their core business activities (Arora and Puranik, 2004) while others suggest that companies in India are engaging in CSR for reputational, financial, and relational benefits (Jamali et al., 2015c; Mehra, 2006; Sharma, 2011; Sood and Arora, 2006) or are driven by local moral values and top management commitments (Arevalo and Aravind, 2011). In Pakistan, recent work shows the importance and role of local collective institutions, such as industry associations, in framing collective responses to international CSR requirements (Lund-Thomsen and Nadvi, 2010a; Fayyaz et al., 2015). On the other hand Kemp and Vinke (2012) argue that Pakistani aviation companies need to improve the disclosure of CSR-related activities in their annual reports to meet the international requirements. In the context of Sri Lanka, research on CSR has highlighted how country-specific contingencies mediate the impact of ethical labor initiatives on the garment industry (Ruwanpura and Wrigley, 2011; Ruwanpura, 2012; Ruwanpura, 2014). In the same context, Perry et al. (2015) showed from a factory management perspective that managers frame CSR in terms of compliance, rather than going above and beyond regulatory requirements. Beddewela and Fairbrass (2015) revealed that multinational companies use their CSR activities to strategically manage their stakeholder relationships in order to gain legitimization advantages. In Bangladesh, Nielsen (2005) explored the practices against child labor in the garment industry and tackled the question of whether the Harkin Bill and the subsequent threat of boycott led to the desired outcomes. Moreover, Kabeer et al. (2010) highlighted the positive impact that NGOs have on various development goals in the absence of an enabling institutional environment in Bangladesh. In Nepal, Biggs and Messerschmidt (2005) investigated CSR in the handmade paper industry, highlighting how socially responsible behavior comes from different interrelated sources such as volunteerism, fair trade codes of conduct to which social entrepreneurs adhere, and CSR codes of conduct arising in the private sector.

This is, however, not all. Several special issues on CSR in Asia (including South Asia) have been published in a range of journals such as Corporate Social Responsibility and Environmental Management, Journal of Corporate Citizenship, Business & Society, and the journal Asian Business & Management or have been the subject of edited books (Fukukawa, 2010; Kumar, 2012; Kim and Moon, 2015; Low et al., 2014; Nasrullah and Rahim, 2014). We currently see numerous CSR initiatives in South Asian countries that aim to improve the prevailing conditions and create economic and social value. Various examples are already documented in the literature. Nonetheless, the collapse of the Rana Plaza garment factory in 2013, resulting in more than 1,100 deaths, reminds us of the utmost urgency of addressing the CSR issues in the region (Lund-Thomsen and Lindgreen, 2014).

To sum up, theoretically the research on CSR in South Asia is largely influenced by the insights produced by various frameworks of political economy, institutional, and cultural theories (in particular critical management). The geographical focus of the research largely is on India, Pakistan, Sri Lanka, and Bangladesh. In our call for articles to this special section of the South Asian Journal of Global Business Research (SAJGBR), we originally received 24 submissions, out of which only three articles have made it into the final special section, representing three different country contexts, Afghanistan, Bhutan, and India. Due to the small number of included articles, this special section will certainly not revolutionize our view on CSR in South Asia as a region. Rather, we believe that the three included articles, each in its own way, contribute to our ongoing discussions of CSR in this region, particularly the countries (Afghanistan, Bhutan, and India) that are addressed in the included articles. In particular, the papers on Afghanistan and Bhutan extend the geographical focus of the research as well as highlight the role of religion, institutions, state, and MNCs in shaping CSR agenda. The paper on India offers a lens to observe the intersection between CSR and corporate social entrepreneurship and in this sense it identifies a new trend that may transform the role of business organizations in India.

The first study, "CSR in Afghanistan: a global CSR agenda in areas of limited statehood" by Sameer Azizi and Dima Jamali, looks at the CSR practices of large corporations in the Afghan mobile telecommunications industry and analyzes the institutional conditions for the emergence of specific CSR activities and interventions. By doing so, the study points to the nature of local vs global pressures which permeate the organizational field and shape CSR in Afghanistan. By employing an institutional and limited statehood perspective, the authors reveal that local institutional pressures are hardly salient in Afghanistan given the fragility of local institutions. This enables the companies to take advantage of the existing institutional voids to deal with local needs through a global agenda on CSR within the field.

The second study, "Gross national happiness: lessons for sustainability leadership" by Sander Tideman, advances our understanding on how CSR is connected to religious values, beliefs, and philosophies (Muniapan and Satpathy, 2013; Sharma et al., 2009). The study looks into Buddhist philosophy and shows that ancient Buddhist principles provide guidance for innovation in leadership for sustainability. By outlining the principles of interconnectedness, serving stakeholders needs, governance, and cultivating societal well-being including the inner dimension of subjective happiness, this study deepens our understanding as to how to design and implement appropriate and effective CSR strategies at both macro and micro levels.

The third study, "Corporate social entrepreneurship in India" by Sreevas Sahasranamam and Anirudh Agrawal, examines how corporations in India create social and economic value through corporate social entrepreneurial activities. The authors develop an integrated model for corporate social entrepreneurship based on three business cases in India and illustrate that corporate social entrepreneurship is determined by environmental and organizational factors. Moreover, they provide empirical evidence that corporate social entrepreneurship is beneficial for obtaining explicit and implicit benefits. In fact, the authors outline that corporate social entrepreneurship initiatives can open new market opportunities and new channels of revenues, while simultaneously providing the companies with political and social legitimacy, trust, goodwill, and new collaborations.

Taken together, each study provides contemporary insights into CSR practices in South Asia that advance our understanding of the topics covered in the articles. We hope that readers see the same in the special section as us: valuable as well as stimulating for new work in this important field of research.

Tassilo Schuster - Department of International Management, Friedrich-Alexander-University of Erlangen-Nürnberg, Nürnberg, Germany

Peter Lund-Thomsen - Department of Intercultural Communication and Management, Copenhagen Business School, Frederiksberg, Denmark, and

Bahar Ali Kazmi - Work and Organisational Psychology Group, Aston Business School, Birmingham, UK

Note

1. We use The World Bank definition of South Asia which includes Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.

Acknowledgements

The authors would like to express great thanks to the many scholars who provided the authors with support in compiling this special section, most importantly during the review process. The thorough and thoughtful reviews helped the authors to further improve their manuscripts. The authors would also like to express thanks to Shaista E. Khilji and the editorial team of South Asian Journal of Global Business Research (SAJGBR) for their assistance.

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About the Guest Editors

Tassilo Schuster is an Assistant Professor at the Department of International Management at the Friedrich-Alexander University of Erlangen-Nürnberg, Germany. His main research interests are in the areas of international management, human resource management, and management in emerging markets. He is particularly interested in business strategies focussing on low-income markets, corporate social and environmental responsibility, top management teams, and expatriate management in high-risk countries. Tassilo Schuster is the corresponding author and can be contacted at: mailto:tassilo.schuster@fau.de

Peter Lund-Thomsen is an Associate Professor at the Copenhagen Business School, Denmark. His research focusses on the linkages between global value chains, industrial upgrading, and corporate social responsibility in South Asia.

Bahar Ali Kazmi is a Lecturer in Social Responsibility, Ethics and Sustainability at the Aston Business School. His research focusses on CSR and the social, ethical and political roles of corporations and NGOs in transnational business networks.

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