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How mandatory corporate social responsibility can help governments with development goals

Sodhi, M. ORCID: 0000-0002-2031-4387, Kumar, C. and Ganguly, A. (2021). How mandatory corporate social responsibility can help governments with development goals. Business Strategy and Development, doi: 10.1002/bsd2.181

Abstract

Many governments seek the private sector to meet their development goals. One possible means to enlist this support is to impose mandatory or “hard” corporate social responsibility (CSR) requirements on large companies. To shed light on how mandatory CSR could be helpful in this regard, we study the case of India, where the government has required large companies to spend a fraction of their income toward development as CSR since 2014. We analyzed the expenses of leading Indian companies and found statistically significant similarities among these companies in their spending pattern across the different categories, which we interpret as isomorphism. By looking for the government's motivation and the companies' motivations—both perceive the priorities in unmet social needs—we present a conceptual model to explain this isomorphism in CSR expenditure across different categories. The model suggests that governments may find mandatory CSR helpful to direct corporations in achieving development goals.

Publication Type: Article
Additional Information: This is the peer reviewed version of the following article: Sodhi, M. , Kumar, C. and Ganguly, A. (2021). How mandatory corporate social responsibility can help governments with development goals. Business Strategy and Development,, which has been published in final form at https://doi.org/10.1002/bsd2.181. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions.
Publisher Keywords: Development goals, mandatory CSR, India, isomorphism, conceptual model
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HG Finance
Departments: Business School > Management
Date available in CRO: 10 Aug 2021 15:17
Date deposited: 10 August 2021
Date of acceptance: 1 July 2021
Date of first online publication: 10 August 2021
URI: https://openaccess.city.ac.uk/id/eprint/26581
[img] Text - Accepted Version
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