CSR in multiple environments: the impact of headquartering

Abstract

Purpose – This paper aims to argue that the on-going professionalization and dissemination of the current wave of corporate social responsibility (CSR) concepts and instruments leads to a headquartering effect, i.e. the concentration of CSR-related decision-making within corporate headquarters. This headquartering effect casts doubt on earlier studies suggesting that the “transnational” or “glocal” model can effectively address the multitude of global and local CSR challenges modern multinational companies (MNCs) face. Design/methodology/approach – This conceptual paper uses a stakeholder lens, in turn, drawing from resource dependence theory and organizational legitimacy theory to develop under which conditions claims of Southern stakeholders will be considered by Northern MNCs. It provides evidence for the existence of a headquartering effect as a defining characteristic of mainstream CSR approaches. Findings – The authors argue that the increasing professionalization and dissemination of mainstream CSR approaches among MNCs reinforce the headquartering effect, with strategic decision-making increasingly confined to the companies’ headquarters, while the scope of action within the subsidiaries and the supply chain of MNCs becomes increasingly restricted over time. Ultimately, this headquartering effect strengthens a Northern CSR/sustainability agenda and fails to empower developing country stakeholders. Originality/value – The paper contributes by exploring how international CSR follows a different underlying rationale than international business. While international business research follows an instrumental perspective, international CSR is driven by both instrumental and normative considerations. Thus, international business theories may not be directly applicable to international CSR contexts.