Corporate social responsibility in emerging economies: Investigating firm behavior in the Indian context

• Date: 01 March 2019
• DOI: http://doi.org/10.1002/tie.22021
• Author: Derrick E. D'Souza,Swati Panda,Charles Blankson
• Published date: 01 March 2019

AREA PERSPECTIVES: ASIA AND SOUTH-EAST ASIA

Corporate social responsibility in emerging economies:

Investigating firm behavior in the Indian context

Swati Panda

1

| Derrick E. D'Souza

2

| Charles Blankson

1

1

Department of Marketing and Logistics,

College of Business, University of North Texas,

Denton, Texas

2

Department of Management, College of

Business, University of North Texas, Denton,

Texas

Correspondence

Swati Panda, Department of Marketing and

Logistics, College of Business, University of

North Texas, Denton, Texas.

Email: swati.panda@unt.edu

Scholars have questioned the appropriateness of using a western-centric framework to investi-

gate corporate social responsibility (CSR) in emerging economies. This study assesses the appro-

priateness of using such a framework in one emerging economy—India. More specifically, the

drivers of CSR and their impact on firm-level CSR activity in the Indian context are investigated

and compared with those in developed economies. Content analysis of 369 CSR policy state-

ments of publicly traded Indian firms revealed the factors that drive CSR activities of Indian

firms are similar to those found in developed economies. However, the ways firms respond to

the drivers of CSR are surprisingly different in the Indian context, and these differences can be

traced to attributes of the Indian socio-cultural context. Implications and recommendations for

future research conducted in India, and in other emerging economies, are offered.

KEYWORDS

corporate social responsibility, dharma, emerging economies, firm, framework, India

1|INTRODUCTION

In an increasingly global marketplace, firms are under significant

pressure to deliver on the expectations of their stakeholders. They

must differentiate themselves to maintain a competitive advantage

and remain profitable. However, they cannot achieve these deliver-

ables on their own, and must work symbiotically with their

stakeholders—their employees, consumers, suppliers, and society in

general—to survive and grow. Consequently, more than ever before,

businesses are actively incorporating corporate social responsibility

(CSR) activities into their strategic and day-to-day business

endeavors (Elkington, 1998).

Scholars have investigated this business trend for several years.

Most of this research has been conducted in developed economies,

primarily North America and Europe (for example, see Dobers &

Halme, 2009; Egri & Ralston, 2008; and Visser, 2008). The general

consensus is that in developed economies an organization's CSR activ-

ities are driven by “forces”emanating from four contexts (economic,

regulatory, ethical, and social), and there are recognizable patterns of

organizational CSR activities that occur in response to these four con-

textual forces. However, despite substantial progress made toward

understanding CSR activities in developed economies, little is known

about them in emerging economies (Jamali & Karam, 2018; Kuada &

Hinson, 2012; Okereke, Vincent, & Mordi, 2018; Okpara & Wynn,

2012). This has led to the use of predominantly western-centric inter-

pretations of CSR in the limited number of publications that have

focused on the phenomenon in emerging economies (Jamali & Karam,

2018). Some scholars have argued such western-centric perspectives

may not be applicable to emerging economies because of the nature

of stakeholder engagement, institutional norms, and business system

configurations that tend to be idiosyncratic to the national context

(Azmat & Ha, 2013; Azmat & Zutshi, 2012; Boubaker, Chourou,

Himick, & Saadi, 2017; Jamali & Karam, 2018). In addition, unique

combinations of regulatory infrastructure, corporate norms, civil orga-

nizations, and community groups may result in differing CSR incen-

tives and strategic choices (Campbell, 2007).

Given the gap in the understanding of the CSR phenomenon in

emerging economies, we chose to focus this study on one emerging

economy—India. Our intent is twofold. First, we would like to assess

the appropriateness of western-centric CSR frameworks in the Indian

context, in terms of the contextual forces driving the CSR activities of

firms. Second, we intend to investigate the patterns of organizational

activities that occur as a response to these contextual forces. India is

a fast-growing economy with vastly different social, cultural, and polit-

ical structures from those found in western nations, making it an ideal

case study of CSR in developing economies. India's distinctive roles of

DOI: 10.1002/tie.22021

Thunderbird Int. Bus. Rev. 2019;61:267–276. wileyonlinelibrary.com/journal/tie © 2018 Wiley Periodicals, Inc. 267