Multinationals with a Proactive CSR Approach

Abstract The increasing pressure for social responsibility and sustainability that multinational enterprises (MNEs) are facing in their global operations represents one important emerging phenomenon within the international business field. In this book chapter, we present an in-depth case study on how a fashion MNE develops implements practices market context. focusses MNE’s work related to energy efficiency renewable production of Bangladesh. purpose chapter is advance understanding about particular pertinent proactive approach corporate (CSR). contributes ongoing discussions field role MNEs driving implementing practices. We add CSR undertaken by MNE, Keywords Proactive Emerging markets Multinationals Case Sustainability Stakeholder Citation Hånell, S.M., Tolstoy, D. Tarnovskaya, V. (2023), "Multinationals with Approach", Ghauri, P.N., Elg, U. S.M. (Ed.) Creating Sustainable Competitive Position: Ethical Challenges International Firms (International Business Management, Vol. 37), Emerald Publishing Limited, Bingley, pp. 93-109. https://doi.org/10.1108/S1876-066X20230000037006 Publisher: Limited Copyright © 2023 Sara Melén Daniel Tolstoy Veronika Tarnovskaya License This published under Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate create derivative works these (for both commercial non-commercial purposes), subject full attribution original publication authors. terms licence be seen at http://creativecommons.org/licences/by/4.0/legalcode. Introduction have become subjects polarized debates responsibilities running fair sustainable (Jamali, 2010; Wettstein et al., 2019). Given managerial capacities outreach, some argue should play leading roles (Ghauri, 2022; van Tulder 2021). Studies also stated disappointment over rather reactive nature diffusing around world (van approaches develop mainly as response public discourse stakeholder (e.g. Asgary & Li, 2016; Barin Cruz Pedrozo, 2009; Egels-Zandén, 2014). Such take actions comply laws standards minimum levels but not necessarily convinced importance actions. contrast among MNEs, recent studies requested more research could proactive, (Tarnovskaya 2022b). Some even claim it our scholars investigate depth can practices, particularly context 2022). respond such calls. CSR. operate multiple different across world. A recurrent challenge corporations relates cultural contextual forces. For markets, challenges tend pronounced. Earlier emphasized what considered ethical desired behaviour certain correspond values held actors another part (Bondy 2012; Elg 2015). Tetra Pak’s operation Indian market, al. (2015) showed struggled obstacles consumers’ scepticism towards packaged milk. needed increase awareness health advantages packaging technology milk local well trust Pak brand technology. Swedish implementation living wages Bangladesh, was shown suppliers factories were hesitant engage dialogue buyer MNE. Local Bangladesh did see logic raising or discussing wages, buyers 2022a). Based earlier studies, is, therefore, clear differences between home put severe There growing stream CSR-related focus, examined MNEs’ subsidiaries (Kim 2018; Park 2015; Rathert, Reimann 2012). show evidence taking approach. These demonstrate economically socially motivated strategy enables them embedded communities stay ahead competitors (i.e. approach) Baumann-Pauly 2013; Beckman 2009). make investments communities, example, education. They educate customers topics, including safe (Yin Jamali, 2016). When stock extant literature, discern opportunity greater depth, where advocated stronger economy 2019), suggest those useful insights discussions. study, will build upon very literature review 2022b) been identified analysed. use conceptual from empirically explore adopted markets. Theoretical Framework has often cited legitimacy forces firm’s pursuits. Among pressures influences (Luo Bhattacharya, 2006), employees (Park 2015), investors society whole (Galbreath Shum, underlying view firms pursue agenda only after they exposed pressured external stakeholders society. Hence, activities predominately reactive, force approach, illustrates engaging reasons philanthropy, transparency, enhance firm reputation (Surroca 2010), ties governments and, doing so, value through efforts. Value generated comprise sense instilled managers company enhanced which can, eventually, into economic profits. settings, change initiatives affect well-being conditions industries (Lind 2020). focus specifically used its market. To do draw two identified, strategic Although collectively exhaustive, find using developments enable us analysis theoretical framework, outline approaches, portrayed (2022b). describing (i) involved delimited set broad range stakeholders, link value-chain operations) (ii) impact activities). developing framework concepts interchangeable. While need sharpened Bansal Song, 2017), others interchangeably Similar guiding interchangeably. Approach – Strategic Perspective One so-called relation reflects shift passive compliance externally imposed expectations engagement environmental matters (Husted Allen, Yin Companies pursuing proactively evaluate issues outperform competitors, areas human rights, workplace safety, (Baumann-Pauly 2013). however, immediately concern If attended properly, likelihood companies favourably evaluated. way, relate significantly arguments made Porter Kramer (2006). key source competitive advantage corporations. involvement, implies attention carefully selected groups engagement. development orientation determined realities, than pure interest creation. Jamali (2016) focussing multinationals Chinese designed close fit company’s mission objectives. assessing economic, technological, political trends engaged government, customers, non-governmental organizations (NGOs) design programmes. Common involve training staff (Child Tsai, 2005), partnerships other civil negotiating regulations authorities 2005; Dang include making covering, education (Hadjikhani Furthermore, demonstrated supply-chains involving training, capacity building knowledge sharing principle strategic-oriented connected directly goals country area. integration strategy. many like construction schools, education, medical care community closely relationships suppliers, distributors, thus creating valuable outcomes direct relevance development. review, broadly concerns achieving stakeholders. when described ‘authentic’ comparison instrumental lacks authenticity stakeholders’ eyes Engaging ‘commitment contribute goods shape agenda, irrespective value’ following account, firms. Engagement becomes behavioural feature viewed equal partners decision-making process perspective involves organization constellations initiatives, takes precedence value. As Chilean (Beckman 2009), network extended beyond primary It included NGOs (national transnational), various unions, activists regulatory organizations, police organizations. Another Nestle India (Asgary 2016) reached out ‘bottom’ (local farmers) providing nutrition, medicine, technical assistance interactions governments. Moreover, implement principles supply chains. selective choice compliant continuous monitoring, improvement working conditions, strong chain partners, schools employees’ Broad educational welfare (Eweje, 2006). Other highlight types aimed improving diversity workforce inclusion young people (Barin stakeholder-aimed engagement, continuing relationship provides base implemented. stressed (2009), far dialogue. (2009) found worked learn problems eventually co-created solutions challenges. Table 1 summarizes ideas depicted drawing future-proof generation. serves business-critical NGOs) reach targets productivity, profitability growth immediate tied operations. matured inclination organize impact. ‘bottom-level’ workers, members, called upon. 1. Approaches. Stakeholders Serves governments, Takes firm. Even workers suppliers) Example strategic-aimed integrated goals, issues; society; investment relationships. Different Method rests premise there understand address aspects ethics sensitive study. embraced exploratory phenomenological (Ghauri Grønhaug, 2010) further chose conduct qualitative allowed new holistic gain able empirical topic. have, followed purposeful, sampling (see Eisenhardt, 1989). meant chosen reasons, choosing enabled describe manner, pertaining chain. specific example documented experience relatively long time period largest located operating time. order being developed implemented proved interesting relevant. was, thus, revelatory potential information richness accessibility. representativeness Data Collection Analysis overall data collection phases. 2019, entered first phase focussed conducting interviews HQ level responsible tasks work, climate water. conducted physical meetings, length each interview 30 100 minutes. aim policies codes relating matters, learning sustainability, routines interacting offices second phase, began 2020, actual processes team attitudes programmes stories projects unfolded water). possible projects. via Zoom Teams, most interviews, met up four helping Each meeting 60 minutes length. experienced Teams facilitated collaboration coordination gave access local-level dynamics had challenging achieve non-online mode. Primary data, form 10 firm, constitutes main phases collection, secondary annual reports, news articles, press releases websites. sources served anchor points preparing questions. ensured validity provided detailed regarding organized implemented, commitments, etc. collect relevant searched documents available website database Retriever Business. database, newspaper articles 2011 until keywords name, climate, WWF. search vast number items, downloaded reviewed detail. questions guided all headquarters level. covered interacts collaborates commitments throughout support rigorous recorded transcribed. transcribed analysed together documents. analysing open coding anchored question. process, narrative techniques, identifying commonalities differences, exploring recurring themes patterns. line O’Dwyer (2004, 23), based iterative carried parallel collection. category efficiency. looked involved. Finally, region. Empirical Findings Global Fashion Retailer Aiming Become Climate Positive M NE established 1947 single store women’s clothing. city Västerås Sweden. tremendous journey retailer presence just 70 retail 21 basic idea sell trendy apparel affordable prices. explained company, beginning democratize fashion. What means highlighting democratization everyone privileged few. because, report, ‘it way years come’ (Sustainability 2018). generally fast-fashion likes Zara, Topshop Primark. concept fast criticized promotes unsustainable ‘tear wear’ consumption. clothes requires energy, chemicals water thereby, significant negative effects environment. though reliable fashion’s footprint scare, article Guardian clothing industry polluter world, oil (Gunther, Others industry’s carbon emissions flights shipping combined (BCG, Fast-fashion compete quickly responding trends. cycles getting shorter, collections sold year ramped which, turn, accelerates production. innate unsustainability widely media, researchers. companies, question companies’ claims actions, starting garments stores (Stål Corvellec, symbolic any substantive nature. On similar note, report announced progress reducing moving enough counteract rapid if wants sustain rates, must radical action light widespread urgency change, realized harmful model. vision makes attempt explicit articulates intends ‘to lead circular positive industry, while company’. statement, recognizes of. Goal Throughout Entire Chain 2016, launched strategy, presented ambitious goal entire 2040. removing greenhouse gas emits. bold target. At launched, ready becoming positive. head Committing target move. still know exactly get there, rely research, technology, WWF dedication fulfil go. (Source: Anonymized 2018) Despite having ready, priorities already start following: Priority leadership efficiency, little possible. committed stages 2 tackles 100% goal, help ensure sourced group renewable. own directed particul