Local effects of transnational corporate social responsibility (CSR)
Increasingly, transnational companies are expected to contribute to economic and social development in the countries they operate in. In this doctoral thesis I will examine how the Norwegian corporate social investment and CSR activities affect local communities in Indonesia and Canada, and how local stakeholders receive and perceive such investments.
In working with my master thesis at the Department of Geography of Bergen I examined the effects of CSR activities for Norwegian companies in Indonesia. I found that most companies carry out CSR programs targeting communities in order to please key stakeholders, i.e. local or national authorities, customers or workers. However, although the companies did not identify communities as key stakeholders, they still received the main bulk of the social investments.
Now I want to follow the social investments into the local communities, and investigate how these are received locally, what effects they have, and how the local population perceives companies and their expatriate employees.
I also found some interesting similarities between CSR projects and corruption. Both phenomena represent resource transfers from companies to local stakeholders, and thereby "investments " companies make in a geographic area, based on local stakeholders' expectations. The difference is that where corruption is hidden , either through intermediaries or outside the public eye , CSR programs are presented in both budgets and companies' reporting practices internally and externally.
We also see that CSR-activity has its price, and not all companies are interested in such a grounding of their business in local conditions. Most businesses come to Indonesia to make money on the cheap access to resources, be it either natural resources or unskilled labour. For many, it becomes a burden to relate to the local community.
I have therefore developed three research hypotheses that I want to highlight:
- Corruption is a manifestation of the lack of reciprocity between transnational companies, expatriates and the local community
- Corporate Social Responsibility activities may curb expectations of corruption and other irregular resource transfers, and contribute to a more transparent and accountable reciprocity between companies, expatriates and communities.
- Negative sentiments within the ex patriot communities towards local communities represent one of the strongest detachment forces within the companies.
This PhD project is part of the " International Migration and Ethnic Relations (IMER) " program at the University of Bergen.