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The role of government in corporate social responsibility acitons by enterprises: systematic review of literature
1. The impacts of Corporate Social Responsibility
A systematic review of the effects of government supported
interventions on the corporate social responsibility (CSR) behaviour of
enterprises in developing countries
For the Policy and Operations Evaluation Department (IOB) of the Netherlands Ministry
of Foreign Affairs
Verina Ingram, Karin de Grip, Giel Ton, Marieke Douma, Marieke de Ruijter de Wildt, Koen Boone 24-10-2012
2. Aim
Find out what have been the outcomes and results of Dutch
government’s efforts to influence the way companies
approach CSR in developing countries.
Systematically explore & analyse effectiveness of public
policy support for enhancing or supporting CSR in private
sector development programs in developing countries
Different pathways for generating CSR behaviour explored
that could have effects on employment relations, human
rights, fair operating practices (combat of bribery and
corruption), environmental care, consumer interests,
community involvement and organizational governance
(including information disclosure
4. Review methods & results
Figure 1
7 = Dutch policy
18 = policy in other country
10 = NGO
policy
20= National
legislation
14 = supranational policy/
convention
5. Quality of evidence: weakness a problem.....
Quality parameter
Independence
of evidence
10
Not independent
authors
Independence not
clear
Clear
23
52
74
30
71
2
7
5
12
7
5
19
6
14
7
47
16
59
23
55
8
53
10
37
18
43
Strong
8
53
10
37
18
43
4
27
6
22
10
24
Unclear
4
1
27
7
5
2
19
7
9
21
3
7
12
80
23
85
33
79
Mixed methods
b
2
13
3
11
4
10
Included
counterfactual
No counterfactual
2
12
0
0
2
5
14
82
21
78
32
80
Largely quantitative
Largely qualitative
Counterfactual
analysis or
reasoning
17
63
67
20
3
20
1
Total
number of
publications
n
%
Weak
Type of study
33
Independent authors
a
Rigour of analysis
5
Publications with no
information on policy
intervention/support
N
%
Unclear
Reliability
Peer reviewed
Publications with
information on policy
intervention/support
n
%
•reliability of information sources; representativeness of results, outcome indicators assessed .
•clear indicators and steps in pathway , clear description of intervention strategy, consistency between results and conclusions.
Note: Shaded rows indicate good quality, unshaded rows indicate lower quality.
6. Results: Location of evidence – HD level
total %
3 = medium
development
country
No information
policy %
2 = Low - medium
development
1 = Low income
country
Information
policy %
0%
50%
100%
M (48%) LM (18%)
57%
-
UNDP Human Development Index (HDI)
rankings 2011
7. Evidence on CSR behaviours
80%
70%
60%
50%
40%
Information policy %
No information policy %
30%
total %
20%
10%
0%
Communication Relationships
Voluntary
/ disclosure on building CSR
codes /
CSR
certification on
CSR
CSR policy
internal in
enterprise
External
reviewing /
improving
enterprise
Enhancing
credibility
regarding CSR
9. Pathways : with & without mention of policy
32%
42%
32%
HUMAN RIGHTS
32%
ENVIRONMENT
OTHER
FAIR OPERATING
PRACTICES
63%
37%
LABOUR
PRACTICES
CONSUMER ISSUES
ORGANISATIONAL
GOVERNANCE
COMMUNITY
INVOVLEMENT
WITH INFO ABOUT POLICY
COMMUNITY
INVOVLEMENT
HUMAN RIGHTS
44%
24%
ENVIRONMENT
44%
FAIR OPERATING
PRACTICES
OTHER
44%
LABOUR
PRACTICES
COMMUNITY
INVOVLEMENT
24%
CONSUMER
ISSUES
NO INFO ABOUT POLICY
ORGANISAITONAL
GOVERNANCE
10. Pathways : with & without mention of policy
Other
community involvement / development
consumer issues
fair operating practices
total %
No information policy %
labour practices
Information policy %
human rights
organisational governance
environmental
0%
10%
20%
30%
40%
50%
60%
70%
11. Evidence from specific sectors: implications
for target ting policy & corporate interest?
60%
50%
40%
Information policy %
30%
No information policy %
total %
20%
10%
0%
Industry and trade
Business & commerce
manufacturing
agriculture, livestock, timber
services
other
16. Results:
Q1. What are the effects (impacts, outcomes and
cost-effectiveness, directly or indirectly) of government supported
interventions on the corporate social responsibility (CSR) behaviour
of enterprises in developing countries?
Some evidence of impact of certain policy types, through
specific pathways and in specific sectors on specific impact
themes
Evidence of indirect impacts clustered around particular
high profile concerns …. (e.g. Oil and gas impacts etc...)
Evidence on cost effectiveness extremely limited &
generally anecdotal. Suggests positive cost effectiveness:
CSR activities benefit access to finance, shareholder &
customer goodwill and consumer acceptance. Some limited
counterfactual evidence to support this.
Some literature with costs was excluded (eg corporate CSR
reports) as did not mention policy drivers or impacts.
17. Results:
Q2. What is known about the effects of CSRbehaviour of enterprises, influenced by government supported
interventions, on poverty reduction in developing countries?
● Vast majority of CSR interventions business practice driven (not policy), majority (61%) also
by corporate philanthropy.
● Most interventions concentrate on internal CSR company policy, followed by voluntary
codes, communication and disclosure and enhanced credibility
● Mainly in low developing countries – but varies over time, with increasing numbers of
publications (perhaps an indicator of CSR behaviour ?– conjecture) now in countries that
have moved up (e.g. Brazil, China, India, South Africa)
● Majority occur in industry and trade, but did have a bias towards specific sectors e.g. oil
companies, consumers retail and those with dramatic histories of media coverage and
academic discussion. Dominated by larger, multinational firms, but some X cases of smaller
firms and national firms located in developing countries
● Evidence tends to be provided of long term (over 5 years) CSR activities. Idicative of longer
time scales, or due to a bias in the studies?
● Main outcomes heavily focussed on labour issues, followed by environment. Could be bias in
peer reviewed literature with a focus on specific topics and companies (e.g. Shell)
● Outcomes tend to be evidenced at firms/company level, followed by sector or chain, and
community. A fifth each give impacts at micro scale (household or individual 18% together)
or a macro/national economy (20%), some studies report on more than one level.
18. Results:
Q3. What are the main gaps in evidence?
The whole pathway from government intervention to poverty alleviating impact in a
developing country
Evidence gaps on a national or regional level: tends to be specific “projects’’ and
geographically local
Weak level of analysis: reliance on anecdotes, difficult to verify
Little quantitative or multi methods based evidence presented: Majority
qualitative, anecdotal with methods and references not provided
Little on (cost) effectiveness either policy or company level of CSR behaviour
Long term time retrospective assessments lacking
Lack of robust evidence that government supported interventions influence company
CSR behaviour in developing countries: Most attention has been on impacts in
developing countries and on outcomes and only 15 policy related studies
Ad-hoc use of indicators and many different ones- limits comparability
19. Looking backwards: What worked well
with policy on CSR in terms of gaining an
impact and what did not?
Worked well
● 75% literature had some indicators, especially for on
HR, labour & environment impact
● Certain impact types were indicated: environment, human
rights, labour, community development
● Evidence especially about endorsing types of policy
support, also mandating
● Influence of supranational policies/conventions and NGOs/ UN
Compact/GRI etc. apparent (ISO not yet)
Didn't work well
Sparse indicators for some impact groups
(consumer, community involvement, organisational
governance)
Robust evidence!
Total pathway linked evidence
20. Looking forward: Recommendations
Policymakers could identify pathways by which a policy and
its intervention mechanisms means seek to impact poverty
alleviation and sustainable development and the scale on
which they can achieve this – and not only the outputs and
outcomes of such interventions.
Developing pragmatic indicators for all assumed CSR
impacts for policy and enterprises
PSOM/PSI Triodos study serves as good model – although
additional focus on poverty impacts and indicators needed
– now outcome based.
Definition of developing country needs to be clearer and
flexible to account for changes over time
Review methods can be improved (broader or more specific
country focus, longer publication date)
21. Conclusions
1. empirical evidence re policy-induced CSR behaviour in
developing countries still scarce and limited, also due
to the long time frame required to generate outcomes.
2. Company CSR behaviour triggered by multiple internal
and external factors - effect of policy incentives difficult
to disentangle. Governments play a key role in
mediating between conflicting corporate and
development agendas.
3. Government policies towards CSR make almost equal
use of all 4 intervention pathways:
endorsing, partnering, facilitating and mandating. Most
positive impacts are documented for facilitating and
partnering policies. Negative or mixed results were
most reported for mandating and endorsing policies.
22. Conclusions (cont)
4. Majority of documented CSR behaviour from industry
and trade sectors (energy, mining, textiles and
crafts), followed by agriculture (good agricultural
practices, fair trade) and manufacturing (consumer
electronics). Impact reporting dominated by large
multinational firms operating in or sourcing from
developing countries.
5. Many indicators used for assessing CSR impact, lack
of standardization makes comparison difficult. Most
frequently used re labour relations (24%), environment
(16%), community involvement (11%) and human rights
(9%).
6. Impact of CSR behaviour on societal outcomes
remains ambiguous, indicating both positive, negative
and sometimes mixed effects.
23. Conclusions (cont)
8. Main reported impact areas of CSR behaviour - in
order of importance - (i) labour practices (ii) community
development, (iii) environment, (iv) human rights, (v)
consumer issues, (vi) fair operating practices and (vii)
organizational governance. Most policy information is
available for the first three. - generally positive
social, economic and/or environmental impacts, but 24%
studies indicated negative and 22% both positive and
negative effects
9. Sustainability of CSR impact is largely unknown, since
few studies devote attention to long-term prospects.
Indirect effects of CSR behaviour at local and sector
level are likely to occur but scarcely documented
10. Little meaningful data re investments in and cost-
effectiveness of CSR. Anecdotal evidence of benefits in
(access to finance, stakeholder and consumer
goodwill, and consumer acceptance.)