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The aim of this chapter is to develop the measurement of corporate legitimacy among Government-linked Companies (GLCs) in Malaysia. Corporate legitimacy is important for determining the survival of the corporation. The term of legitimacy can be classified into three different aspects, namely, political, economic, and social legitimacy. Political legitimacy indicates the right to govern and rule; economic legitimacy reflects on success through product selling, customers’ satisfaction, and providing better services and goods. However, in the corporate sectors, corporate social responsibility is used as a platform not only to gain economic legitimacy, but most importantly to achieve social legitimacy. Social legitimacy focuses on corporation as a societal institution that is more complex by combining the social norms, values, and expectation. With the above argument, this chapter explores how corporate social responsibility (or corporate responsibility) can be used to show societal acceptance reflecting their corporate legitimacy. The corporations are expected to be socially acceptable according to social norms, values, and beliefs. The growth of the corporation has faced a number of challenges in gaining and maintaining their existence. While the corporations are expected to deal with the challenges effectively, the corporations must also be relevant in the eyes of the stakeholders. To establish this, corporations emphasized on gaining and maintaining legitimacy through various mechanisms. The principles of legitimacy are related to the conformity to the norms, values, and expectation of their stakeholders’ engagement through corporate social activities. The study employed a cross-sectional sample survey designed to collect data from a pre-selected list of non-governmental organization (NGOs) obtained from the Registrar of Societies, Malaysia. From a list of about 22,000 societies, 377 were shortlisted covering five categories of societies: community welfare, education, sport, social and recreation, and business and trade union. This study measured three dimensions of corporate legitimacy comprising pragmatic, moral, and cognitive legitimacy. Using Partial Least Square-Structural Equation Modeling (PLS-SEM), this study found that there is a high level of corporate legitimacy from the perspective of NGOs, which indicated that the NGOs highly view the corporate legitimacy of Malaysian GLCs through their corporate responsibility activities.

For corporate communications, it is crucial to know how news media outlets report and frame the sociopolitical activities of multinational corporations (MNCs), including their corporate diplomacy, that affect perceptions of their legitimacy. Therefore, this study aims to identify how local news media frame corporate diplomacy in a host country and, in turn, benefit the media legitimacy of MNCs.

To identify media frames in the host country, a quantitative content analysis involving factor and cluster analyses of 385 articles published in newspapers in the United Arab Emirates from 2014 to 2019 addressing the corporate diplomacy of large European MNCs operating in the country was conducted.

This study identified three media frames, two of which establish moral and pragmatic media legitimacy. Results suggest that media legitimacy grows when news media emphasise institutional relationships between MNCs and local, established organisations and corporate diplomacy's benefits for society.

Findings provide insights into how corporate communications can contribute to legitimacy building by emphasising corporations' relationships with institutional actors in host countries and the benefits of corporate activities for local communities.

To the best of the authors’ knowledge, this study was the first in corporate communications to empirically investigate news media's role in corporate diplomacy and how media frames contribute to the media legitimacy of MNCs at the moral, pragmatic, regulative and cognitive levels.

The purpose of this paper is to answer the call for CSR communication research to develop and substantiate outcomes that may better explain CSR communication strategies and practices. The paper takes the research a step further, exploring the role of legitimacy in CSR communication research.

A literature collection methodology, combined with directed content analysis, was used to identify central themes in the literature.

The following categories of studies were identified: perception, impact and promotion studies; image and reputation studies; performance studies; and conceptual/rhetorical studies. Addressed from a legitimacy perspective, the study found that the most important types of legitimizing communicative practices articulated in the four types of studies were related to: seeking knowledge about stakeholders through perception, impact and promotion activities; monitoring and controlling the environment through image and reputation activities; creating stakeholder value through collaboration and engagement; and persuading and convincing stakeholders through rhetorics, CSR models and concepts. The study also found that practices and activities related to perceiving stakeholders’ expectations, needs and requirements are assumed to be most effective for corporations aiming at building or maintaining legitimacy.

The key contribution of the paper lies in exploring how corporate legitimacy is anticipated and extrapolated in the CSR communication literature, including which pinpointed CSR communication strategies and practices are assumed to be more effective than others in bridging stakeholders’ perceptions of corporations’ social and environmental actions. Until date, no reviews exist of the role of legitimacy in CSR communication research.

This study aims to examine the impact of brand ethical behavior, specifically perceived brand ethicality, on corporate brand legitimacy in the context of halal cosmetics, by considering perceived brand integrity as a mediating factor.

The study used a quantitative cross-sectional research design to gather data from 341 fast-moving consumer goods (FMCG) in Tanzania. The data was analyzed by using AMOS 21, using structural equation modeling techniques.

The findings indicated that perceived brand ethicality has a significant influence on corporate brand legitimacy through the mediation of perceived brand integrity.

The study emphasizes the significance of incorporating and clarifying Islamic laws as integral components of marketing strategies aimed at attracting conscientious customers of halal products. It recommends defining Islamic laws as societal values and norms and integrating them into various brand practices to showcase professionalism, ultimately fostering social acceptance and approval. The study presents valuable practical implications for managers and marketers of FMCG, assisting them in formulating policies and strategies that reflect societal values and norms.

This study represents a novel endeavor that explores the interplay between perceived brand ethicality, corporate brand legitimacy and perceived brand integrity in the context of halal products. It extends theoretical understanding by shedding light on the significance of Islamic laws as a foundation for establishing a competitive advantage. By offering and designing ethical practices, businesses can enhance their legitimacy among halal consumers, particularly in the domain of halal cosmetics.

The purpose of this paper is to explore the implications of IR reforms in South Africa on corporate disclosure practices of South African companies. In particular, the authors explore initial trends in corporate disclosures following the adoption of IR practice.

Drawing from Suchman’s (1995) framework of strategic and institutional legitimacy, the authors use content analysis to examine corporate disclosure practices. The authors conduct industry-specific analyses based on various industries to explore corporate disclosures practices across and within various industries in South Africa. The evidence is drawn from 246 integrated reports of large South African companies across six major industries over a three-year period (2011-2013), a period following the introduction of an “apply or explain” IR requirement in South Africa.

The results first show a significant increase in the overall amount of corporate disclosures following the adoption of IR practice. In particular, the authors find that intellectual capital and human capital disclosure categories have increased over time, with relational capital disclosures showing a decreasing trend. Second, the authors find that corporate disclosures are increasingly becoming institutionalised over time across and within industries following the adoption of IR practice. However, companies fail to provide meaningful disclosures on the interdependencies and trade-offs between the capitals, or components of a capital following the adoption of IR practice. Overall, the authors find that companies use specific disclosure strategies to respond to external pressures (strategic legitimacy), and that such disclosure strategies are increasingly becoming institutionalised across and within various industries (institutional legitimacy).

The theoretical implication of this study is that the strategic and institutional perspectives of legitimacy theory are complementary, rather than conflicting, and dovetail to explain corporate reporting practices. In terms of practical implications, the adoption of specific reporting frameworks such as the emerging IR framework is a double-edged sword. On the one hand, such reporting frameworks could potentially enhance comparability and consistency of organisational reports across and within industries. On the other hand, corporate reports could become a set of monotonous reports motivated by considerations other organisational accountability. Hence, to overcome the latter, this study emphasises the importance of specific accountability metrics and reporting guidelines, rather than the current generic IR guidelines, to enhance organisational reporting practices.

The paper’s longitudinal analysis of a large sample of integrated reports following the adoption of IR practice has the potential to inform growing academic research and ongoing policy initiatives for the emerging IR agenda.

In weaker institutions, lack of corporate social responsibility (CSR) constituencies causes organizations to naturally incline toward corporate socially irresponsible actions. Grounded in the institutional theory, this paper aims to explore the nature of corporate social irresponsibility (CSIR) in the weaker institution and its effect on legitimacy and reputation. The presence of corporate ability moderates the impact of CSIR on legitimacy and reputation.

A list of manager’s contact information was generated from an online database. In total, 1,500 employees in 560 Pakistani organizations received the self-reported survey. In total, 203 managers working in 110 Pakistani organizations responded with the completed questionnaire that provided empirical support to the hypotheses.

Institutional drivers were positively significant to CSIR and negatively associated with the manager’s CSR attitudes. CSIR was negatively significant to legitimacy and reputation. Group differences between high and low corporate ability indicated that corporate ability played a vital role between CSIR and reputation.

These results have important implications for leaders, business-to-business and human resource (HR) managers in weaker institutions highlighting that organization’s supply chain partners consider adopting CSR practices. This can help the organization avoid undesirable and detrimental impact on its legitimacy and reputation, which are linked to irresponsible behaviors. HR managers should build CSR cognition in employees to bring effective change in the organization.

Lack of investigation into corporate ability and CSIR has raised questions about the organization’s efforts in the weaker institution that are sensitive to institutionalized corruption. This research adds to the literature by exploring how the organizations develop legitimacy and reputation while still acting irresponsibly in a weaker institution, presenting a paradox.

There are no management decisions deprived of ethical or political consequences. Political corporate social responsibility (CSR) has been highlighting this assertion but research at the microlevel on this topic is scarce. This study aims to contribute to the microlevel research by proposing a behavioral framework where leaders’ political skills are determinants of engagement in strategic CSR and perceived CSR leverages their ascribed legitimacy to perform a political role outside the boundaries of the organizations.

Building upon political CSR and critical realism theories, this study offers a general review on key political CSR microlevel concepts and examines multiple dimensions of CSR to explain the indirect effect between boards' political skills and political legitimacy.

This research suggests that high politically skilled leaders are associated to more CSR adoption which fosters higher legitimacy to act as political influencers. Among these, CSR activities directed toward community members and employees are seemingly the most successful from a political standpoint.

This study proposes a contemporary form of political influence to business leaders that, in contrast with other strategies such as lobbying or financing political campaigns, does not end up damaging corporate image and reputation. Also, this study proposes that not all CSR activities leverage corporate political legitimacy per se, therefore they do need to be differentiated. This study then offers a comprehensive future research agenda, including detailed suggestions for research designs and measurements.

This qualitative paper is about social reporting in response to an incident that involved the loss of human life. It examines Loblaw’s disclosures following the Rana Plaza building collapse that killed over 1,100 Bangladeshi workers.

This article draws on Suchman’s (1995) comprehensive legitimacy typology to interpret Loblaw’s disclosures about the collapse in both mass media coverage of the tragedy and the company’s quarterly, annual and corporate social responsibility (CSR) reports.

Loblaw worked on many fronts to secure stakeholders’ support in the aftermath of the fatal incident. Through their social disclosures, Loblaw simultaneously managed exchange, dispositional, consequential, procedural, structural, personal and cognitive legitimacy, striving to demonstrate that, notwithstanding the incident, the company was still conforming to its social contract.

This research operationalizes all aspects of Suchman’s legitimacy typology in the context of social reporting. In particular, the paper further develops the concept of cognitive legitimacy. This should be of benefit to other CSR researchers.

The loss of human life during business operations is one of the most terrible events an organization can face. Corporate activities leading to loss of human life are obviously far from being socially acceptable. Stakeholders are likely to disapprove such activities and reconsider their support, which can threaten the survival of the organization. It is thus of utmost importance to understand the strategies used by corporate managers in their attempt to secure ongoing stakeholder support.

This paper innovates by focusing specifically on social disclosures about a negative event. In so doing, it also contributes to a small, but important, literature within CSR research that examines incidents resulting in the loss of human life. The paper adapts and applies Suchman’s legitimacy framework to interpret social reporting in response to a specific instance of loss of life, the Rana Plaza building collapse. Finally, this paper mobilizes the notion of cognitive dissonance to further develop Suchman’s notion of cognitive legitimacy.

This study examines the impact of expanded geographical disclosures on nonprofessional investor judgments. Public country-by-country reporting (CBCR) is a way to increase corporate transparency, enhancing tax fairness and accountability (European Commission, 2016). Public disclosure would make large multinational companies share information about profits, taxes paid, and number of employees on a per-country basis. However, it is unclear whether nonprofessional investors would even use CBCR and how they would interpret the information. Adding to the policy debate on whether publicly available country-by-country information will be properly used, this study employs an experimental design to investigate the effect of disclosure availability and content on nonprofessional investor judgments. We find that participants receiving an expanded disclosure are able to more accurately assess the state of the social contract between the organization and society, imposing sanctions if necessary. Exploring CBCR provides timely evidence to regulators, standard setters, and tax fairness campaigners on the impact of expanded geographical disclosures as a means of increasing transparency and improving competitiveness.

Organizational legitimacy is greatly influenced by firm corporate social responsibility (CSR) records. An organization with a poor CSR record can either try to improve its practices or attempt to manipulate institutional norms and belief systems in order to convince the society that its practices are acceptable. The authors argue that firms’ corporate political strategies (CPS) – attempts by firms to influence public policy outcomes in a favorable way – can be very effective in shaping legitimacy norms and offsetting negative public image. The purpose of this paper is to draw on institutional theory and propose that firms with negative CSR records consider investing in political strategies necessary in order to construct new legitimate standards in line with their strategies.

The authors test the hypotheses on 348 manufacturing firms using data from “The Center for Responsive Politics.” MSCI (formerly known as KLD) and COMPUSTAT. Research methodology used to test hypotheses is hierarchical ordinary least square regression analysis.

The authors find that firms with high CSR concerns invest more in CPSs. In addition, the results indicate that organizational visibility and organizational slack positively moderate this relationship. In other words, visible firms and firms with high organizational slack invest more in CPSs if they are facing CSR concerns compared to firms that are less visible and with less organizational slack.

In this paper, the authors focus on the corporate governance dimension of CSR. Although focussing on the negative corporate governance practices gives us an opportunity to have a more focused approach, there are other important aspects of CSR such as environmental practices, employment issues, and accounting practices that are not addressed in this study.

This paper can serve as a testament to the value of investing in political strategies to the practitioners. The results indicate that firms can manage their image and reputation through political spending and this is especially true for firms that are more visible and have more organizational slack.

Much of the previous literature explores the relationship between market factors such as financial status of the firm and political strategies. This paper contributes to the literature by showing that other non-market forces such as poor social standing can also motivate companies to invest in political strategies.