Determinants of corporate social responsibility activities in multinational enterprise subsidiaries in Ghana

Abstract

In recent years, corporate social responsibility (CSR) of multinational enterprises (MNEs) in developing and emerging countries have increasingly attracted scholars' attention and has been the subject of policy debate. Most studies on MNE CSR have focused on large emerging economies, such as Brazil, Russia, India, China or Indonesia. Consequently, African countries have been largely neglected in the MNE CSR literature. Moreover, a critical review of the literature shows that the topic is often approached from a single level, for example, the institutional, organisational or individual level. Few studies have examined MNE CSR engagement across multiple levels. Further, little is known about individual-level factors and how these influence CSR in less developed countries, particularly in Africa. Prior studies have shown that single theories fail to provide a holistic understanding of CSR determinants. Integrating multiple theories is considered to provide a better explanation of CSR engagement. Therefore, the study examines how these variables are influenced from multiple levels. The study adopted a quantitative methodology. Secondary data on CSR, corporate governance and financial information were sourced from the annual reports of 44 MNEs operating in Ghana. Information on CSR expenditure and key financial and corporate governance attributes was used to construct the dataset. The final sample included 365 firm-year observations between 2008 and 2018. This study contributes to the MNE CSR engagements literature on emerging countries by providing insights into the MNE CSR activities of an African country. By investigating Ghana, this study responds to the call of Kolk and Rivera-Santos (2018) for further MNE CSR research in Africa. Second, the study provides extensive evidence on multiple determinants of MNE CSR engagements. Prior studies suggest that while local expectations shape MNE CSR engagements in Africa, there is no single factor explaining the CSR activities of firms. The study complements the literature by providing evidence on factors at the home country, firm and individual levels. Further, by investigating the impact of the home country's culture, the study provides empirical support for the framework proposed by Matten and Moon (2008). This framework distinguishes implicit and explicit CSR and conceptualises the impact of cultural systems on CSR. The study also contributes to the literature by identifying the CSR foundation as a new driver of MNE CSR engagement.

Date of Award	2022
Original language	English