Convergence or divergence? A comparative analysis of CSR communication by leading firms in Asia,Europe, and North America

Through the lens of the communicative institutionalism and an extensive content analysis of corporate websites, this study compared corporate social responsibility (CSR) institutional messages by firms across three macro regions. The findings show that Asian firms do not present significant differences in how they expose their orientation to sustainability (i.e. “CSR identity” messages) than Western counterparts. However, Asian firms seem significantly less inclined to engage in CSR messages concerning “organization and management”, messages on “CSR interactivity” and those regarding “CSR as business case” compared with European firms. The difference between Asian and North American firms mostly concerns the former’s less salient use of “business case” messages for CSR. The comparative study sheds light on the pattern of CSR crossvergence across the West and East, reflecting hybridized CSR expressions across forms of CSR institutional messages.     

The role of corporate social responsibility in strong sustainability

The aim of this paper is to analyze to what extent corporate social responsibility (CSR) contributes to strong sustainability, i.e. to what extent the use of natural resources and the environment is possible, given the current level of economic activity. We therefore examine responsibilities that corporations should take in order to fulfil the requirements of strong sustainability. Based on current CSR practices and theory as well as on businesses motivations regarding environmental and social investments, we will introduce the role of corporations in influencing consumption patterns. Furthermore, we will attempt to answer to what extent responsible corporate behaviour is determined by the current economic system.     

Investing in Turbulent Times: The Investment Behavior of Polish Firms in the Early Transition

We examine the investment behavior of a sample of Polish industrial firms over the period 1991–1993 by means of a model that views investment flows as part of the firm’s effort to adjust its assets and liabilities so as to maximize the returns to the firm. We argue that the application of neoclassical models of investment is more appropriate in cases where net investment is positive and where the returns to other assets and costs of liabilities are stable. If firms are seeking to reduce their capital stock, then the major constraints are not financial but rather set by the speed of physical depreciation. If the returns to other assets or the costs of liabilities change, then the firm will be forced to reconfigure its balance sheet in a way that may be inconsistent with the neoclassical model of investment. This paper examines the adjustments undertaken by Polish firms and shows that firms that did make positive net investments in this period were influenced by their capital intensity, profitability and by their costs of and returns to financial assets. The explanatory power of the model is relatively high when compared to previous studies of the investment behavior of firms in the early years of transition.     

Labor union effects on innovative activity

Union rent-seeking is considered a tax on firm returns from investments in innovative activity. We examine this proposition by considering the responses of firms in a 1985 survey on R&D and product innovation. Consistent with our model, we find that innovative activity is significantly less important for union than for similar nonunion firms. We conclude that innovative activity may be an important route through which union rent-seeking affects the long-run performance of firms. We appreciate the helpful assistance and suggestions received from our colleague Terry Seaks, Barry Bozeman at Syracuse University, and participants in the Vanderbilt Microeconomics Workshop.     

MEASURING THE INTERDEPENDENCE OF MULTINATIONAL FIRMS' FOREIGN INVESTMENTS

Earlier work found evidence for geographic linkages of aggregate foreign direct investment across countries and country‐pairs. From a theoretical point of view, such linkages at the macroeconomic level may root in between‐firm as well as within‐firm linkages and originate from information spillovers across or within firms in exploring unknown markets, and vertical linkages between production plants across different locations within the firm. We use data on the universe of German multinational enterprises (MNEs) to empirically explore how marginal investments at one foreign affiliate depend on investments at other affiliates within the same MNE. The empirical approach employs two channels or modes of cross‐affiliate interdependence: mere geography (capturing horizontal linkages through correlated learning and horizontal competition within the firm) and input–output relationships within or across industries (which capture vertical linkages). Adding to earlier findings at the aggregate level, we find evidence of a significant interdependence of investments within the firm. In the firm‐level data at hand, vertical linkages appear to be more important than horizontal ones. Investments at one location tend to stimulate investments at other locations of the same MNE, particularly if input linkages are strong. The opposite seems to be true for output linkages. Beyond vertical linkages, mere geographic proximity matters only to a minor extent. This suggests that evidence of linkages through geographic closeness at aggregate data levels accrue mainly to reasons of vertical linkages within networks of affiliates. (JEL C31, D22, F21, F23, F68, G31, H32)     

Understanding Reputational Crisis: Definition,Properties, and Consequences

To better understand the nature of reputational crisis, this study examined two crisis events using the corporate ability (CA) and corporate social responsibility (CSR) crisis categorization frameworks. This scenario-based experimental study validates the usefulness of the CA–CSR crisis categorization by demonstrating that not only do people actually discern differences between these two types of crises, but their awareness of a crisis type also influences their interpretation of the crisis, as well as their perceptions of and attitudes toward the target firm. In particular, this study shows that a CSR crisis, versus a CA crisis, is interpreted more seriously and, consequently, causes heavier damage to the evaluation of the firm. In addition, the halo effect of a favorable prior reputation was found in the CA crisis condition, but not in the CSR condition. Based on these findings, this study suggests that the recognition of CA and CSR crises provides a boundary condition, which determines divergent effects of crises on perceivers' evaluation of the target firm.     

INTERNATIONAL DEAL EXPERIENCE AND CROSS‐BORDER ACQUISITIONS

I show that corporate directors' human capital facilitates international investments. Directors' experience with cross‐border transactions positively influences firms' decisions to conduct their first cross‐border acquisitions. Cross‐border acquirers are more likely to buy firms headquartered in countries with which the directors have prior deal experience. This effect is strongest for target firms headquartered in culturally and institutionally dissimilar countries. Announced cross‐border acquisitions are received more favorably by financial markets and are more likely to be completed successfully when the announcing firm has a director with cross‐border acquisition experience. These effects are not driven by investment bank involvement in the deal process or by other forms of directors' human capital, and they are robust to endogeneity of director hires. (JEL F23, F21, J24, L23)     

Innovation, workers skills and industrial relations: Empirical evidence from firm-level Italian data

The shifting of labour demand toward relatively more skilled workers has been a hot issue in the economic field for many years. A consolidated explanation for the upskilling phenomenon is that technological–organisational changes have driven the labour demand with detrimental consequences for less skilled workers (skill-biased technological–organisational change). In order to upgrade the skill workforce the firm has at least two main channels at its disposal: the external labour market strategy, mainly based on hiring and firing mechanisms; the internal labour market strategies, which improve the skill base of the employees through training activities.The main objective of the present work is to verify the relations between innovative strategies and both the workforce composition and the training activities, within an integrated framework that also leads us to consider the role of specific aspects of the industrial relations system.The firm level analysis is based on original datasets which include data on manufacturing firms for two Italian local production systems, located in the Emilia-Romagna region.The results suggest that the firms use both the two channels to improve their skill base, which is actually related to the innovation activities, although there is weak supporting evidence of the use of external labour markets to upgrade the workforce skills: the upskilling phenomenon seems to be associated to specific innovative activities in the technological sphere, while specific organisational aspects emerge as detrimental for blue collars. On the side of internal labour market strategies the evidence supports the hypothesis that innovation intensity induces the firms to implement internal procedures in order to upskill the workforce, confirming the importance of internal labour market strategies. Moreover, we have recognized the important role of firm level industrial relations in determining the training activities for the blue collar workers.     

The Sociology of Innovation: Organizational,Environmental, and Relative Perspectives

Innovation is risky. New products and firms are subject to high failure rates. To minimize the risk associated with innovation, most scholars agree that firms should engage simultaneously in two types of activities: exploring new alternatives and exploiting existing competencies. Firms that simultaneously engage in explorative and exploitative activities are called ambidextrous organizations. Research on ambidextrous organizations, however, inadequately considers the importance of the environment in which organizations operate for innovation success. The sociological view of innovation fills this gap by emphasizing the importance of social context for explaining innovative outcomes. The sociology of innovation highlights, first, the structural arrangements – characteristics of social networks, organizations, and institutions – that influence innovation and, second, the relative nature of innovation – whether an object is considered novel depends on one's vantage point. Drawing on the relative view of innovation, I develop a typology that outlines several paths to innovation with respect to two vantage points: the organization and the environment. I argue that minimizing the risks associated with innovation is most likely to occur when firms follow the path of innovation that consists of generating novel solutions that simultaneously exploit knowledge and resources that are both available to the firm and in the firm's environment.     

INDEPENDENT AGENCIES,POLITICAL INTERFERENCE,AND FIRM INVESTMENT: EVIDENCE FROM THE EUROPEAN UNION

Investment in network infrastructure is crucial for economic growth. This article studies the impact of the presence of independent regulatory agencies (IRAs) on the investment of European regulated firms. We account for measurement error in formal independence of IRAs by exploiting cross‐country heterogeneity in the quality of political institutions. Results show that regulatory independence increases firms' investment rate by around 1.2%–3.3%. The positive effect survives when we control for social capital accumulation, investor protection, and market liberalization. However, the effect of IRAs is not immune to politics, as we find that political interference in regulatory functions persists in the European Union and is detrimental to firm investment. (JEL D78, L50, D92, H1)     

Baoren Baoguo: Zhongguo Xinwenshi De Lingyizhong Dufa [To Serve the Nation: Journalists as Prisms of Chinese Press History] edited by CHIN-CHUAN LEE

Social networking sites (SNS) have become an important vehicle for corporate communication. However, there has been little research on how East Asian firms use international SNSs to communicate with global stakeholders. This study compares the communication strategies of Chinese and Japanese companies on Facebook and Twitter and analyzes the public responses and complaints on these corporate SNSs. The results revealed that in addition to the traditional strategies of corporate ability (CA) and corporate social responsibility (CSR), Chinese and Japanese firms adopted the human interest (HI) strategy. The results showed that the Chinese companies in the study sample had a stronger preference for the CSR and interactive strategies, and they responded faster to online complaints compared with the Japanese firms, which were more likely to adopt the strategy of transferring in handling complaints. Moreover, “inviting participation into events” and “seeking specific feedback” were two types of interactive messages that received the highest numbers of responses from the public on Facebook, whereas “promoting sales” showed the highest engagement on Twitter. This study is the first to compare the effectiveness of different corporate response strategies for specific complaint topics on social media. Thus, it contributes to the literature on stakeholder–company interactions.     

Factors affecting stakeholder’s levels of satisfaction with community partnership association in Rayong Province,Thailand

ABSTRACT

Corporate social responsibility (CSR) studies have investigated the differences among five parameters: gender, age, education, income, and occupation; however, the findings are generally dissimilar. For instance, no comprehensive concordance has been reached on the performance and importance of the differences among those five parameters regarding stakeholder expectations and perceptions of CSR activities. Some voluminous investigations have revealed that the literature does not discuss the essential importance of the differences among the five parameters, and as a consequence, the magnitude of such differences is unexplained. This research analyses the quantitative and qualitative significances of the differences among the five parameters in stakeholder satisfaction level and perceptions of CSR activities conducted by the Community Partnership Association in Rayong Province, Thailand. Overall satisfaction levels positively correlated with education and age, indicating that intellectual background and personal experiences considerably influence the perceptions of CSR activities. This study assists policymakers and industrial sectors to launch the most practical strategies for plotting, scheming, implementing, and evaluating sustainability initiatives.     

Social Impact Investment Behavior in the Nonprofit Sector: First Insights from an Online Survey Experiment

This study investigates the social impact investment behavior of private investors in a nonprofit setting. In particular, the influences of three effects—financial return, social impact, and age—on social impact investment behavior are tested in an online survey experiment. The study sample includes bank clients (N = 145) from Germany’s first and largest bank exclusively focused on social and ecological investments. The results with regard to the financial return effects are in line with for-profit research that social impact investors are willing to accept 1% lower financial returns. In addition, younger philanthropists are more likely to contribute part of their money to social impact investments. Further findings reveal that the perceived innovativeness of the project has a consistently positive effect on social impact investment behavior. People with certain profile characteristics (e.g., entrepreneurial spirits) also are more likely to participate in social impact investments.     

The role of local stakeholders in transforming economic upgrading into social upgrading in Ethiopian textile and garment firms

The authors examine the links between economic and social upgrading in a developing country with stringent industry policy and employment legislation, focusing on the strategies of local firms participating in global apparel production networks. Based on the 2015 case studies of five textile and garment firms in Ethiopia, they find that employment security and physical well-being were driven mainly by government labour regulations negotiated by local employers, workers and trade unions rather than by global buyers and conclude that upgrading and downgrading can occur simultaneously within a firm.     

Firm-level training in local economic systems: Complementarities in production and firm innovation strategies

The paper presents a conceptual review over the main aspects concerning the role of human capital investments and training activities within production processes, followed by empirical evidence on two local economic systems in Northern Italy, based on recent survey data. Theoretical and empirical considerations are brought together in order to provide new insights on the role of training and the factors associated to training activities at firm level.The potential driving factors of training here analysed compounds structural characteristics, labour demand dynamics, human resource management practices, workforce features, and firm performances. We observe that training activities emerge positively associated with high-performance practices, innovative labour demand features, workforce skill level, firm size, and are affected by labour flexibility in various directions. Empirical evidence confirms most previous results but also adds further important insights. The analysis suggests that a widening gap, between few innovatively evolving and many stagnant firms, could characterise the future dynamics of the Region. The high relevance of structural variables, labour demand factors and HRM/innovation practices shows that regional industrial policies and labour policies should be jointly implemented for increasing potential firm productivity. This is a key concern for the current debate on local systems economic development in the European and Italian environment.     

Organizational innovations,human resources and firm performance: The Emilia-Romagna food sector

This paper studies the relationship between organizational innovation, industrial relations and economic performance at the firm level. It adopts an applied perspective by means of a comprehensive survey on a specific industrial sector, the food industry, with the aim of investigating: (i) the degree of organizational innovation and the diffusion of HRM practices; (ii) the relevance of the interaction between unions and top management in the process of decision-making at an operative, organizational and strategic level; (iii) the relations between the intensity of organizational innovation and the quality of industrial relations; (iv) the effects of organizational changes on firm performance.The focus is on firms with bargaining activity at establishment level where worker committees exist. The dataset is derived from a structured questionnaire submitted to union members concerning structural data on firms and local productive units, production flexibility, organizational models, compensation systems, industrial relations and firm performance.The quantitative analysis highlights the following critical elements.First, the firm governance seems characterized by a strong relevance of industrial relations, in terms of “good quality atmosphere” and “involvement of worker representatives and employees”: their action proves to be a stimulus to organizational changes. The set of industrial relations variables does emerge as a significant factor explaining firm innovation intensity.Second, although we cannot ascertain the causal link given the cross-sectional nature of data, firm performance and organizational innovations arise as two elements which are strictly and positively related to each other.Third, the evidence points out that good industrial relations are important as far as the firm performance is concerned; nevertheless their role is mediated by their effects on organizational changes rather than having a direct impact on performance.     

Social capital and innovation dynamics in district-based local systems

The idea behind this paper is that social capital (SC) is interpreted as a component of an investment, which implies entangled private and public benefits. Within a theoretical framework that considers SC as the public component of the impure public good R&D we show that the ‘civic culture’ of the district in which a firm is located is not a sufficient incentive for the firm to increase its investment in SC, because SC/networking dynamics might positively and complementarily evolve only if the opportunity cost of investing in innovation is sufficiently low. Consequently, we focus our attention on a specialised biomedical industrial district characterised by a strong pattern of innovative activity. We observe that R&D and networking/social capital arise as complementary driving forces of innovation outputs. When the empirical evidence confirms that this complementarity plays a key role, policy efforts should be targeted toward both market and non-market characteristics, rather than solely to the production of local public goods or innovation inputs as independent elements of firm performance. This is very important in terms of policy effectiveness. In fact, we argue that SC/networking dynamics might positively evolve only if the private opportunity cost of investing in R&D innovation is sufficiently low. Nevertheless, this exogenous economic incentive works as long as complementarity, as defined here, holds.     

Social security and firm performance: The case of Vietnamese SMEs

This article investigates how social security provision – a key determinant of formality – impacts on small and medium‐sized firm performance in Viet Nam. Based on enterprise census data covering all registered firms from 2006 to 2011, the authors find that firms which increase their social security coverage by 10 per cent experience a revenue gain of 1.4–2.0 per cent per worker and a profit gain of up to 1.8 per cent, depending on the survival time of the firm. However, given the time lag between “investment” (in social security contributions) and returns (enhanced firm performance), specific policy measures such as initial social insurance subsidies for small firms could increase participation in mandatory schemes.     

The Mean and Lean Firm and Downsizing: Causes of Involuntary and Voluntary Downsizing Strategies

Despite the longevity and pervasiveness of downsizing, our knowledge about this practice is inadequate for at least two reasons. One involves underanalysis of the historical context in which downsizing has evolved and the other involves the tendency to equate downsizings with layoffs even though layoffs represent only one of numerous downsizing strategies. I address the one inadequacy by identifying two institutional factors—the spread of economic competition and shareholder activism—that have motivated large firms to embrace the lean and mean conception of control and thus to implement downsizings. I address the other inadequacy by distinguishing between involuntary and voluntary downsizings and by testing the ability of a theory of downsizing strategies to explain these two kinds of downsizing among Fortune 100 firms from 1979 to 1995. The findings support the theory: Involuntary downsizings occur when firms face economic pressures and when social processes define these acts as natural; voluntary downsizings occur when firms are shielded from economic pressures and when there is a social preference for these acts. There also is support for the hypothesis that the effects of economic factors on downsizings should decrease over time while those of institutional ones should increase. Finally, I emphasize the role that analyses of institutional contexts, conceptions of the firm, and corporate strategies and structures can play in advancing our understanding of the powerful large firm in America.     

Innovation capability: A sociometric approach

To remain competitive worldwide, firms need to focus on their knowledge-based activities and possess specific abilities that allow them to unravel their potential to innovate. This need has led to an increasing interest in understanding the factors that allow a firm to develop its innovation capability. However, given the complexity of the phenomenon, there is no consensus on the nature and definition of innovation capability. Moreover, most existent studies have focused on studying innovation as a psychometric phenomenon; however, this approach neglects the social dimension of the construct. Thus, an exploratory study is conducted to examine a firm’s capability to innovate from a sociometric perspective. To achieve this objective, 61 surveys were distributed in the biotechnology area of a Mexican university. In addition, informal relations and knowledge sharing are analyzed as determinants of innovation capability. Since, the multiple regression quadratic assignment procedure (MRQAP) is applied.The results reveal that friendship relations become the base for knowledge sharing and, at the same time, this factor positively impacts a firm’s innovation capability.