Multinational companies and the corporate social responsibility at home: the stakeholder approach
ISSN: 0025-1747
Article publication date: 23 November 2018
Issue publication date: 16 October 2019
Abstract
Purpose
The purpose of this paper is to integrate stakeholder and international business (IB) theories to explore the relationship between the international diversification of emerging-market multinational corporations (EMNCs) and corporate social performance (CSP) in their home markets. While the IB literature generally assumes a positive effect from international diversification on CSP as a result of global learning, the study aims at investigating the complicated effects in the link to the stakeholder theory.
Design/methodology/approach
This paper used combined sources of public survey data (corporate social responsibility (CSR) of the Korean firms) and archival data (foreign direct investment and corporate data). A truncated regression is used for statistical model.
Findings
International diversification helps MNCs to enhance CSP in their home countries. Thus, EMNCs can develop CSR capabilities at the global level, thereby benefiting domestic stakeholders. Also, significant investment in domestic research and development (R&D) and advertising negatively moderates the relationship between international diversification and domestic CSP. In this regard, expanding R&D and advertising facilitates global competitiveness. Moreover, as international diversification increases, EMNCs may redirect resources and re-orient CSR policies toward foreign stakeholders. Consequently, the relationship between international diversification and domestic CSP weaken.
Practical implications
Acceleration in international diversification may weaken domestic CSP, which arises from transformation into the global enterprises.
Originality/value
The study highlights the difficulties of EMNCs in serving domestic stakeholders effectively when their businesses are increasingly internationalized.
Keywords
Citation
Kim, E.W., Choe, S. and Kwak, J. (2019), "Multinational companies and the corporate social responsibility at home: the stakeholder approach", Management Decision, Vol. 57 No. 9, pp. 2383-2400. https://doi.org/10.1108/MD-01-2018-0109
Publisher
:Emerald Publishing Limited
Copyright © 2018, Emerald Publishing Limited