How is csr related to globalization




















Government funded CSR programs are also expanding internationally and deal with international development challenges; this is initiated by various programs such as Dubai Cares, which is the largest CSR initiative in the Middle East supporting social welfare in low-income countries in fields of education, health, water and sanitation, and school infrastructure [ 20 ].

The government also encourages employees to participate and volunteer in social projects through an initiative called ENGAGE [ 21 ]. Other UAE-funded national and international initiatives support SMEs by promoting CG and raising awareness on issues of transparency, responsibilities of board directors, auditing, and sustainability practices [ 20 , 21 ].

Lastly the Dubai Ethics Resource Centre specifically targets issues of CSR in the Gulf markets by planning forums and seminars in collaboration with business leaders and Gulf executives; their training sessions focus on improving knowledge of CSR targeted at professionals with the aim of enhancing CSR programs, strategies and infrastructures [ 21 ].

UAE governmental initiatives have yielded tangible results, evident through the increased awareness by consumers in the country, and specifically in Dubai and Abu Dhabi Emirates, where responsible business programs are concentrated [ 20 ]. Qatar is also a country rich in oil and gas with other booming sectors, with Qatar recently serving as the largest exporter of cement and steel [ 22 ]. It is a small country with the second highest migration rate and the first GDP per capita in the world [ 23 ].

The Qatari government has been according importance to accountability and transparency issues in the country, setting fertile ground for the disclosure of information, specifically related to socially responsible behavior [ 24 ].

While financial reporting has improved in the past decade, CSR disclosure is still a voluntary practice in Qatar, and not enforced by law. Companies lack a broad scope of CSR disclosure that mostly focuses on human resources; state regulations by the Qatari Government would help enhance CSR activities and set clear environmental disclosure standards in line with global sustainability trends [ 22 ].

Through initiating semi-governmental institutions, Qatar has participated in national and international philanthropy and community outreach programs [ 23 ]. In the country put forth the Qatar National Vision setting clear sustainable development goals with economic, social, and environmental targets. To further promote CSR activities and disclosure, the government should apply legal regulations for private sector involvement based on international and professional standards and criteria [ 14 , 26 ].

Oman is an emerging mixed market economy that also highly relies on the oil and gas sector with a salience of joint ventures with international corporations [ 27 ]. Private sector partners along with the civil society are expected to collaborate with the government to maintain national competitiveness and equality. The state has set local development targets through the national socio-economic development plan Vision , launched in ; these collaborations are also in line with national inclusion, where all sectors are expected to be involved in steps for development planning [ 27 ].

Kuwait has a large oil economy and therefore the recent oil production cuts have affected economic growth [ 10 ]. The government is attending to this issue through plans of economic diversification; a privatization plan was put in place to shift dependence from the oil and gas sector. Due to its legal context, it is up to the firm to participate in socially responsible activities such as human and labor rights. While some companies studied had assigned a board committee, others do not even have a selected board committee to look over governance issues [ 28 ].

There is no legal framework for social responsibility issues; however, some large sized companies exhibit some kind of participation in CSR practices [ 28 ]. This would be more organized and enhanced with well-structured legal regulations for accountability, CG, and social responsibility. GGC governments are playing an integral role in putting the basic infrastructure and groundwork for securing a path towards a sustainable future in the region.

Some GCC countries are trying to enhance and monitor CSR practices by diversifying national economy and supporting the private sector and civil societies, by launching philanthropic programs to aid sustainable development and reducing poverty and by establishing international networks to help other low-income countries.

However, not all governments are as much involved, some are still lacking laws that enforce CSR practices and legal regulations for accountability. Normative and institutional pressures resulting from belief systems have a great impact on CSR practices in the GCC [ 17 ]; Islamic teachings salient in the region, view social responsibility as an obligation to business activity [ 18 ], namely through the Zakat obligatory tax to be given to the poor on an annual basis, and a general requirement by Islam to enhance social welfare and preserve environmental ecosystems [ 29 ].

However, these traditional efforts fall short of the global CSR standard, as they are usually private, fragmented, lack accountability and a clear strategy to maximize effectiveness of business philanthropic efforts [ 21 ]. This section will discuss the religion-CSR logics and draw recommendations on the best course of action for sustaining traditions while moving towards sustainable development. Companies in Saudi Arabia have been following a religious tradition of Zakat which is charitable giving that requires companies and individuals to give an annual endowment of 2.

This longstanding socially responsible tradition has transformed through business development to an obligatory institutional Zakat tax, commonly labeled by corporations as a CSR activity in recent years [ 29 ]. Therefore, CSR articulation has only come up in recent years in Saudi Arabia; initially there was a general traditional obligation on ethical business activities [ 14 ].

A study by CSR consultants in Saudi Arabia found that businesses are starting to leverage the benefits of CSR beyond merely charitable activities; focusing on a broader CSR scope involving employees, communities, and the environment [ 18 ]. Philanthropy has always been practiced in UAE through Zakat.

This has also been institutionalized and organizations are usually compliant with religious doctrines and practices. Due to the prevalent endowment behavior, organizations believe in their responsibilities towards society, apart from their shareholders [ 20 ].

The religious practices are not centralized and approached merely in an informal and unorganized manner. Unlike Saudi Arabia, a Zakat tax is not enforced or collected by the state. However, some have argued against the effectiveness of a centralized Zakat collection practice; such system does little to better the living standards of the needy [ 20 ].

Zakat has a spiritual end whereas CSR ought to be targeted towards social equality and sustainable development. CSR also includes concepts of preservation of resources, sustainable practices, and involving stakeholders in business operations and strategies [ 21 ]. Qatar also has salient Religion-CSR Logics as it is an Islamic country with high social, cultural, and religious expectations of firms participating in philanthropy; this ultimately influenced the introduction of CSR in the professional realm and encouraged company participation to meet their social responsibility expectations [ 23 ].

Community involvement of businesses in Qatar has always been prevalent through donations such as to orphanages, elderly homes, and particularly sports [ 29 ].

Religious groups in Qatar also act as pressure groups on companies to get involved in the annual Zakat tradition [ 24 , 25 ]. These groups account to a significant portion of investors in the country and may choose to invest in companies that show interest in social development and participate with annual philanthropy [ 24 ].

Islamic values need to be present and emphasized by companies in Qatar to maintain legitimacy and survival; through enhanced communication with local groups and communities, and transparent disclosure of socially responsible behavior [ 25 ]. However, one study focused on social responsibility reporting of Islamic financial institutions based in Bahrain. There is evidence of voluntary philanthropic practices in Islamic financial institutions which signifies a commitment to social welfare issues in the country [ 31 ].

Similar to other countries in GCC, Oman is a Muslim nation characterized with philanthropic practices to low income groups, which has contributed to the assimilation of CSR concepts [ 27 ].

There is evidence of a merger in Oman of traditional philanthropic traditions with strategic CSR practices integrating economic, social and environmental challenges [ 27 ]. Islamic religion in the GCC countries views social responsibility as an obligation to business activity mainly through the Zakat tax. However, the Zakat tax was practiced way before the CSR concept came to light and is considered as only one of the secondary pillars of CSR practices which is philanthropic.

Social responsibility is present in the GCC in Islamic financial institutions as well. Market-CSR interface creates various logics depending on the market dynamics of the specific context. International market integration greatly influences CSR logics and expressions. The local context has an even greater impact, for instance in case of monopolies or other peculiar ownership contexts. Moreover, the pursuit of market growth might produce operational negative externalities impacting society or the environment.

Despite the fact that Saudi Arabia is an Islamic state following Islamic law and practices, a study found that companies pursue CSR beyond charitable and philanthropic activities [ 32 ]. Indeed economic, environmental, and social pillars are addressed through CSR, marking a qualitative shift in the country.

However, companies through these practices are in pursuit of higher economic value with higher profits and long-term success [ 32 ]. Therefore, it seems that although a developmental approach is prevalent in some companies in Saudi Arabia; the guiding principle is in line with economic priorities. Saudi Arabia has strong connections politically and economically to the west, and western market logics have manifested in the country [ 14 ]; It is emphasized by many authors that this particular Saudi CSR expression is inspired by western free-market economy influences, and plays a significant role in shaping business practices and economic priorities [ 14 , 32 ].

In this way, it has changed from being an economic activity to a political priority. Consequently, multiple governmental projects took place including generous philanthropic assistantship to low income groups in the Kingdom, as well as a housing development project where the government built half a million residential units for the needy [ 14 ].

This marks an evolution in CSR in the country moving away from western market logics and into new applications rooted in socio-economic rationales. Market logics in UAE are driven by high economic growth and international integration and competitiveness. This open market environment aiming for rapid economic growth may result in socially irresponsible behavior.

Indeed, due to opportunistic attitudes permeating the UAE, business practices have been characterized with poor labor rights, low customer safety standards, unequal welfare distribution, and environmentally damaging activities [ 15 ]. Governmental laws and structured regulations regarding business conduct exist but their implementation depends on institutional monitoring and enforcement capacity [ 15 ]. Although positive state-CSR logics prevail, there are several challenging factors that inhibit proper stakeholder engagement in the UAE market.

Due to the high rate of economic development and international market integration, CSR in Qatar is growing exponentially as western-centric CSR is diffused to relevance in the local context [ 26 ]. Due to the high percentage of international firms in Qatar, CSR global standards and reporting are followed, especially in the energy sector [ 23 ].

The energy sector in Qatar however does not follow the same type of CSR disclosure seen in western energy sectors. On another note, the recent governmental privatization program is attempting to enhance local investments.

A study revealed that post the implementation of this program, a high association between shareholder percentages and CSR reporting prevailed [ 25 ]. Shareholders in Qatar prefer investing in socially responsible firms that prioritize social and environmental challenges [ 25 ]. The Omani market enjoys joint ventures and a majority natural resources sector. This has had a significant effect on shaping CSR expressions in the country, where they are found to be consistent with other emerging economies with similar characteristics [ 27 ].

The best type of CSR practiced in Oman is through philanthropy; this could be due the traditional charitable activities. Due to the economic structure in Kuwait where the market is dominated by major shareholders with a weak legal system, there exists a lack of accountability, proper shareholder rights, and transparent disclosure [ 28 ].

As GCC markets became more open and engaged internationally due to globalization, western logics penetrated CSR practices that shifting the focus away from economic activity to political priority such as in Saudi Arabia and Qatar. In other countries, such as the UAE, the open market led to the inflow of foreigners looking for opportunities and this created a challenging factor facing social responsibility. Corporation-CSR logics constitute of two main paradigms: Corporations pursuing CSR for the aim of higher profits and economic priorities; and corporations focusing on integrating local and global development challenges through CSR strategies.

However, due to the cultural context in the country, businesses and citizens view social responsibility and development as the primary goals of the state structure [ 18 ]. The fact that businesses in Saudi Arabia view CSR as voluntary stands in the way of the governmental plans to make CSR strategies the norm of doing business. Saudi Arabian corporations also showed a high correlation between improved CSR disclosure and board independence and firm size [ 13 , 34 ], signifying that companies with higher financial liquidity and independent audits, are more willing to invest in a CSR strategy and disclosure.

However, small and medium sized enterprises face structural challenges in integrating CSR into their business operations; such companies do not create high employment nor do they follow strategic developmental approach to CSR, rather they merely stick to paying the annually ensued Zakat tax [ 14 ].

MNCs in the UAE tend to follow sustainability pathways through supporting society and the environment in their CSR practices; the majorities of these firms operate in free trade zones of the country [ 20 ]. In a study on CSR perceptions of UAE corporates in free trade zones revealed some linkage between CSR and business performance; most respondents believe in the high economic value that CSR produces such as reputational gains, higher profits, and long-term success [ 21 ].

Nonetheless, clearly targeted and structured CSR strategies are not salient in UAE; this is due to the lack of understanding of how CSR practices should be formulated and what constitutes an effective CSR strategy [ 21 ].

Despite the high awareness of the significance of CSR and importance of following international standards, firms do not have the knowledge of how to implement these standards.

The highest amount of reporting is recorded in large companies [ 25 , 35 ]; as they have higher financial resources to be able to apply CSR strategies, in addition to being more visible to the public eye and so need to maintain a responsible corporate image for long-term success [ 25 ]. Large companies are also more likely to secure funds from banks and other financial funding institutions and therefore they tend to disclose detailed information to convince investors [ 25 ].

Skip to main content Skip to table of contents. Advertisement Hide. This service is more advanced with JavaScript available. Editors view affiliations Jean J. Topic of great interest to all countries, developed and developing, as economic growth is created primarily through companies and corporations International focus Deals with CSR in several countries.

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