Over the past 30 years, research on corporate social responsibility (hereafter CSR) has focused on examining the nature of the relationship between CSR and corporate financial performance (hereafter CFP). By doing so, scholars have tried to answer the ...

Over the past 30 years, research on corporate social responsibility (hereafter CSR) has focused on examining the nature of the relationship between CSR and corporate financial performance (hereafter CFP). By doing so, scholars have tried to answer the question of whether corporations should engage in CSR. Extensive empirical studies on this relationship have been carried out, reporting significantly positive (Parket and Elibirt, 1975; Waddock and Graves, 1997; Carter et al, 2000; Ruf et al, 2001; Schnietz and Epstein, 2005; He et al, 2007), negative (Griffin and Mahon, 1997; Boyle et al, 1997; Brammer et al, 2006), non-significant (Alexander and Buchholz, 1978; Guerard, 1997; Van de Velde et al, 2005) and mixed or nonlinear (Barnett and Salomon, 2006; Brammer and Millington, 2008) relationships. Several articles reviewed the CSR and CFP relationship research in recent years. Margolis and Walsh (2003) found that among 127 empirical studies that they reviewed, 55% pointed to a positive CSR and CFP relationship; 6% found a negative relationship; 24 % reported non-significant relationships, while 18% found a mixed set of findings. Orlizaky, Schmidt and Rynes (2003) conducted a meta-analysis of 52 CSR and CFP studies from 1970 to 1997 and confirmed a universally positive association between CSR and CFP across industries and across study contexts. Although many scholars still consider the results inconclusive, empirical studies and reviews in the past 30 years seem to point to a positive link between CSR and CFP. Moreover, despite the lack of conclusive evidence that proves "CSR pays", an increasing number of corporations integrate CSR into their core business. Whether corporations should engage in CSR seems to be on its way to becoming a somewhat outdated question.
In contrast to the fact that most CSR research have focused on investigating the CSR and CFP connection, a group of studies pointed out that the literature had badly ignored the non-economic factors that might affect CSR (e.g., Campbell, 2007). Rather than continuing to ask the question of whether corporations should adopt CSR, scholars argued that it is time to find out why corporations would engage in CSR behavior and how society can make institutional changes to promote CSR.
As attention to the impact of institutional factors is urgently called for, this study attempts to examine the impact of an institutional environment on CSR behavior in a global context, focusing especially on the role of CSR-related institutional pressures of home country of multinational corporations. By doing so this study will provide clues to the questions as to "why would corporations engage in CSR?" and "how can society make institutional changes to promote CSR?"
Specifically, the objectives of this study are to: 1) explore and test the relationship between corporate competitiveness and CSR to fill the empirical void in corporate competitiveness and CSR link research; 2) investigate the moderating effects of institutional conditions on the relationship between corporate competitiveness and CSR, focusing especially on the institutional pressures of home country of multinational corporations.

The results in this study will demonstrate the moderating effects of the institutional environment of home country of multinational corporations on the corporate competitiveness - CSR relationship. If the hypotheses are found significant, governments ...

The results in this study will demonstrate the moderating effects of the institutional environment of home country of multinational corporations on the corporate competitiveness - CSR relationship. If the hypotheses are found significant, governments and societies that aim to constrain socially irresponsible corporate behavior and promote CSR may find it useful to create good institutional conditions that both force and enable CSR behavior. Particularly, methods like establishing formal institutions such as state regulations, rules and strengthening enforcement capabilities of these formal institutions will prove to be effective and efficient in promoting CSR. Thus governments and policy makers will have to perform their duties faithfully to create adequate formal institutions. Informal institutions such as social values and normative calls for CSR will also have substantial influence in shaping corporation's social behavior. It will be of great help to promote the idea of CSR to the society, including both key stakeholders and the general public. Finally, since NGOs, social movement organizations and the press may play an important role in monitoring and forcing corporations to comply with both formal and informal institutions, press freedom and civil liberties are to be implicated.
This study will aid in filling the void in the empirical research of the corporate competitiveness - CSR link. Also, it will contribute to the empirical research of CSR from the institutional perspective by making one of the first attempts to empirically examine the moderating effects of institutional environment on the relationship between firms' economic conditions and CSR. Moreover, the study will not only answer the first question as to "why would corporations engage in CSR?" by demonstrating a significant impact of institutional conditions on CSR. but also answer the second question as to "how can society make institutional changes to promote CSR?" by implying that the governments should establish CSR relevant formal institutions and strengthen enforcement capabilities of those institutions while societies should reinforce normative calls for CSR and strengthen the power to monitor and enforce CSR behavior. Finally, the final results would be valuable resources for developing instructional materials on the subjects of corporate ethics and CSR in international business classes and promoting the growing importance of socially responsible behavior to Korean multinational corporations as they expand their business boundaries globally.

Responding to researchers' calls for more attention to the institutional mechanisms that may influence corporate social responsibility (hereafter CSR) behavior and the society's responsibility in keeping corporations accountable, this study intends to ...

Responding to researchers' calls for more attention to the institutional mechanisms that may influence corporate social responsibility (hereafter CSR) behavior and the society's responsibility in keeping corporations accountable, this study intends to conduct an empirical test that examines the effects of the institutional environment of home country of multinational corporations on their competitiveness and CSR. The purpose of this is to provide clues to two intriguing questions raised by existing CSR literature as future research directions: "Why would corporations engage in CSR?" and "How can society make institutional changes to promote CSR?"
Based on the institutional theory, this study builds a model that tests whether multinational corporations' competiveness has an inverted U-shaped relationship with CSR and also whether the institutional environment moderates the curvilinear relationship of competiveness and CSR through a quadratic-by-linear interaction with competitiveness. The moderating effects are postulated as follows: when institutional pressures of home country are low, the competitiveness and CSR relationship is an inverted U-shaped one. The downward curvilinearity diminishes as institutional pressures of home country increase linearly; when institutional pressures of home country reach a high level, the competitiveness and CSR relationship changes into a positive linear one. Further investigations will be conducted into the respective moderating effects of three elements of institutional pressures of home country ？ government pressure, corporate pressure and social pressure.
The results are expected to answer the first question of "why would corporations engage in CSR?" from the institutional perspective by arguing that institutional pressures corporations encounter force and induce them to engage in CSR for the purpose of avoiding social punishments as well as reaping competitive benefits. The test results will answer the second question of "how can society make institutional changes to promote CSR?" by suggesting that the government should establish CSR-relevant formal institutions and strengthen the enforcement capabilities of these formal institutions, as well as that the society, competitors, suppliers, buyers, and other stakeholders should reinforce normative calls for CSR and the power of monitoring corporate behavior and enforcing CSR. In conclusion, this study purports to make a first attempt to empirically clarify the relationship between corporate competitiveness and CSR and examine the impact of the institutional environment of home country on this relationship. After completing methodologically rigorous, but managerially implicative tests, this study will be able to aid in filling the void in the empirical research of the corporate competitiveness and CSR link and thus contribute to the CSR research literature by testing a model based on the institutional theory.