Corporate Social Responsibility Policy of MNCs: The Defining Parameters - Essay Example

Running Head: Corporate Social Responsibility of MNCs Corporate Social Responsibility Policy of MNCs: The Defining Parameters Konstantin Mikhaylov [Your Uni], Management Department 2007 Abstract Business makes a huge contribution to economic and social development. Companies are becoming more eager to encourage environmental and social progress by remaining true to their own business principles. Whether these are formal or informal, they play an important role in bridging cultural diversity within companies and in enhancing awareness of societal values and concerns. Voluntary principles of Corporate social Responsibility are much more effective than prescriptive regulation because self-regulation is far more easily adaptable to the vast differences in circumstances, objectives, operating methods and resources of individual companies. Principles that are freely adopted without external constraint enable companies to find solutions and make improvements that regulations alone could not achieve. Recommendations require the commitment of executives running the business and the development of expertise and internal processes. Above all, responsible business conduct requires a sustained effort by everybody in the company. A key element of a company's organizational development is promoting the importance of responsible business conduct and ensuring that new managers are well versed in this area. "The brands that will be big in the future will be those that tap into the social changes that are taking place." - Sir Michael Perry, Chairman of Centrica PLC Corporate Social Responsibility Policy of MNCs: The Defining Parameters Introduction If contemporary business trends were made the yardstick, it would not be an exaggeration to state that business communities have become more homogenous. Multi National Corporations (MNCs) serve as perfect instances of this shift. MNCs are investing in major parts of the world, and the boundaries between nations are melting. The channels of communication have become open, and globalization is the norm. However, amidst this entire happening, there are serious concerns that overshadow the race towards more finances, profit and successes. Theses concerns are oriented toward a 'greater common good,' or in a more formal jargon, 'Corporate Social Responsibility'. The World Business Council for Sustainable Development defines Corporate Social Responsibility (CSR) as, "The continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large" (The World Business Council for Sustainable Development, 2006, p. 10). The European Commission advocates that CSR not only means fulfilling legal expectations, but also going beyond compliance and investing more into human capital, environment and relations with stakeholders. This paper will present a review of the recent literature regarding MNC investment into Corporate social Responsibility policies and practices. First, a review of the purpose for public policy development by management will be outlined. Next, several theories of the conceptualization of CSR shall be presented. Thirdly, MNCs and CSR in developing nations shall be detailed in terms of quantitative and qualitative empirical evidence. Finally, a conclusion shall synthesize the main points of the argument and show the value of MNCs investing in Corporate Social Responsibility with regard to maintaining a competitive edge in the market place and aligning with the social norms of a globalized world. A Survey of the Literature An Overview of the Topic Post-modern business discourse is focused on the economic and social consequences of corporate practices (Lantos, 2001). The need for MNCs to adopt a Corporate Social Responsibility approach and to implement it in spirit is immense in the current business scenario. The competition and corporate warfare in the business environment not only makes their focus very self-centered, but also robs them of all the attention they need to provide accountability in the social context. Griswold (2000), who began where others feared to start, offers a short definition of globalization as "the growing liberalization of international trade and investment, and the resulting increase in the integration of national economies" (p.53). It is this mad race toward growth and profit which needs to be controlled in regard to social and environmental issues. This is a necessary step, because at present business competition can catalyze the de-structuring of the social edifice based on values, morals and a sense of social responsibility. There have been grave losses within the environment, as well as people and their lives, as more and more MNCs diversify their areas and reach of operations. It is these concerns that have triggered a major thought process to streamline potential chaos. Group-wide policies provide a standardized approach to corporate governance, employment, health and safety and welfare of all stakeholders, ethical trading and responsible business practices (Lantos, 2001). All of which illustrate a post-modern socially responsible and accountable organization. Time is saved and accuracy increases when colleagues are able to trust each other to complete a task, and when the company takes an accountability stand for how their decisions and activities affect their stakeholders. Environmental awareness reduces risks and negative impacts as well as adds value to the company by virtue of it being able to enhance its commercial operations. This is of benefit to shareholders in that the public will have more confidence in the brand which will increase purchasing behaviors and so increase the market price and subsequent dividends. The implementation of a Steering Committee provides leadership with regard to CSR issues. And can contribute to the defining of clear strategies and be responsible for the management of development and implementation of policies shows the commitment to responsible business practices (Lantos, 2001). An effective method to this madness can only step in when large corporations begin to understand their role encompasses a more responsible perspective to all stakeholders, and not just shareholders. The gamut of this perspective should not be limited to the stakeholders alone, but involve society as a whole, and this requires a more global, rather than local approach to business management. The Purpose of CSR Initiated strategic business issues of management had enabled many parties, such as activists, government and the business community to find a common ground on which to negotiate better management practices (Heath, 1997; Rotmans, Kemp, & Asselt, 2001). At the present time management is more interested at looking for assessment criteria and factual information so that the stakeholders can determine a company's willingness and ability to meet societal expectations in their decision and actions. It is by way of public policy a beneficial relationship can be struck with stakeholders through the effective and efficient management of resource allocation adding value to the company (Lyon & Maxwell, 2004). So that the implementation of policies that develop mutual benefits and allow differing opinions to collaborate and resolve issues. This collaboration can also inform decision-making processes as to standards of professional practice, as well as contribute to research into other management issues. Best practices in the area of public policy include a company dedicating itself to conducting its operations with honesty, integrity and openness; and a commitment to the respect of the rights and interests of employees, shareholders and other stakeholders within the community. This requires that the firm also obey the law, such as complying with the legislation of the nations within which a company operates (Carroll & Carson, 2003). Public policy also addresses the provision of target markets and suppliers with products, systems and services that are of good value in terms of price and quality. Effective public policy ensures that operations of a firm are conducted as required by set principles as to what makes good corporate governance (Buysse & Verbeke, 2003; Lages & Montgomery, 2003). This entails timely, regular, reliable and accurate information of activities, its financial situation and its performance across all the shareholders. As such, public policies assure the community that a firm will act in good faith in all of its business decisions and actions. Transparency also extends to accounting records and supporting documents that provide a description of transactions made by and to a firm. An important feature of public policy that is steadily encouraged in present times is that companies seek those they are in business relationships with to also be committed to a high level of business integrity. Such considerations clearly demonstrate that the processes of globalization are a major challenge for the formation of public policy by MNCs. Especially for MNCs in developing nations, where they may have a great amount of power due to the host nation's reliance on foreign direct investment (FDI) (Archibugi & Iammarino, 1999). Of particular importance, is the argument that MNCs policies that seek to reinforce a host nation's competence; for example with technological innovation, which does not require consideration with regard to resources of the MNC, which would not necessarily benefit the host nation. An alternative argument is that more input and consideration is required from MNCs to better educate and equip developing nations which are faced with socio-cultural changes, such as those that arise through the introduction of innovative technology, as well as from other factors directly related to the rapid advancement of globalization. Part of public policy also involves the company acting as a trusted corporate citizen, and actively engaging in its responsibilities to both society and to the diverse groups that make up the community wherever it, or its subsidiary companies, is located. Also, the company actively seeks to align its business operation with that of its business objectives and legal obligations. Sometimes, a firm will seek to support a charity on an ongoing basis as part of their corporate governance (Carlsson & Mudambi, 2003). There is also a commitment to the environment by the firm, in terms of aiming for continuous improvement in management of environmental impact. With regard to competition in the market, a company's policy would detail how it will comply with competition law, and will actively seek to promote compliance with laws and regulations. The moral obligation of managers, which is also known as agent morality, has been investigated using the moral implications of agency theory. The principal-agent model of the company, now requires that managers develop policies with reference predominantly to moral duties, and secondly to shareholder wealth (Quinn & Jones, 1995). Conceptualization of CSR There have been many studies into the concept of 'Corporate Social Responsibility'. There are many schools of thought on the subject. One approach is to characterize CSR as an extension of the brand-building efforts of companies; another approach attaches a serious functional connotation to the concept (Ogrizec, 2002). George Goyder in his book The Future of Private Enterprise (1951) argues that; Industry in the twentieth century can no linger be regarded as a private arrangement for enriching shareholders. It has become a joint enterprise where workers, management, consumers, locality, trade unions and government all plays a part. If the system which we know by the name of private enterprises to continue, some way must be found to embrace many interests who go to make up industry in a common purpose (p. 23). Milton Friedman (Nobel Prize winning economist) (1962) was a strong proponent of a rigid view of Corporate Social Responsibility. He argued that there is one and only one social responsibility of business- to use its resources and to engage in activities designed to increase its profits, so long as it stays within the rules of the game, which is to say, engages in open and free competition, without deception or fraud. According to this approach, few trends could so thoroughly undermine the very foundations of our free society as the acceptance by corporate officials of a social responsibility other than to make as much money for their stockholders as possible; this is a fundamentally subversive doctrine. Friedman has also discussed how CSR has been critiqued by neo-liberal economists as an aberration from efficient market economics, introducing barriers inimical to choice and enterprise, and subsequently wealth creation. However, it is pertinent to make a note here that anti-globalization academicians view CSR as a defense mechanism driven by public relations and avoidance of more stringent regulations. An alternative model proposed by Ackerman (1975) attempts to describe the development of social responsiveness of a company. Ackerman describes the process as occurring in three stages that begins with top management recognizing the existence of a social problem that needs the company's attention and acknowledges the company's policy towards it. The second stage is the study of the problem and giving suggestions for its redressal. The third and the final stage is the implementation of a social responsibility program. It is argued here that a fourth stage is necessary, an "evaluative" or monitoring stage, that reflects upon the outcomes and empirically compares these to intended goals, to feedback into best practices and policy setting. However, another academician William E. Halal's 'return-on-resources model of corporate performance' recognizes the fact that no corporate social posture would be value-free and this makes corporate social responsiveness a tremendously difficult task (Halal, 1977). Such a view implies that a firm can only attempt to unite the diverse interests of various social groups subject to conflicting social issues. Therefore, the concept of CSR takes time to be implemented, and there are many barriers to its effective execution. A more contemporary view of CSR was put forth by George A. Steiner and John F. Steiner (1991). According to this approach, reasonable Corporate Social Responsibility is as follows; Each business must take into account the situation in which it finds itself in meeting stakeholder expectations. Business is an economic entity and cannot jeopardize its profitability by not meeting social needs. Business should recognize that in the long run, the general social good benefits everyone. The social responsibility expected of a business is directly related to its social power to influence outcomes. Social responsibility is related to the size of the company and to the industry it is in. A business should tackle only those social problems where it has competence. Business must assume its share of the social burden and be willing to absorb reasonable social costs. Other social models have been designed to describe the evolution and extent of social orientation of business corporations. A significant model, among the many proposed, is that of Archie B. Carroll's three-dimensional conceptual model of corporate performance (Carrol, 1991). Carroll describes a three-dimensional perspective as comprising economic, legal/ethical and discretionary responsibilities. As such, it appears that Multinational companies have common corporate policies and procedures but the implementation of these policies differs from one subsidiary to another (Tordoir, 1992). Most of these policies are said to exist on paper but not in practice. This accusation has been attributed to the lack of effective legislation and inadequate regulatory institutions mandated to protect social rights, especially in developing countries. The Commission of the European Communities' Green Paper (2001) identifies two main dimensions of CSR (European Commission, 2002). One is the internal dimension, which relates to the internal functions and processes of a company. The other is the external dimension which involves the external stakeholders. These dimensions are illustrated in Figure 1. There has been a growing acceptance of the plea by social advocates to the business community that corporations should be more motivated toward socially responsible policies and practices. For example, that the business enterprise, which makes use of the resources of society and is dependant on society for its functioning, should discharge its duties and responsibilities in enhancing the welfare of the society of which it is an integral part. Figure 1. The internal and external dimensions of CSR as depicted in the Green Paper (2001) (European Communities, 2002). Several empirical studies have discussed the concept of 'Corporate Social Responsibility'. The different schools of thought explain CSR based on their different experiences and noted consequences. One school of thought emphasizes the model of collective action (Cherian, 2000). A study undertaken by the Kenan Institute, investigated the collective action/institution model and its implementation in Thailand, Egypt and Indonesia, and concluded that the concept of CSR has succeeded in terms of business practices, environmental management and capacity development. This particular perspective talks about the operations of business enterprises as they affect a wide spectrum. Thus, the resources that management makes use of are not limited to those of the proprietors, and the impact of operations are felt by many people across the community who are indirectly connected to the companies; for example. Hence, it is not only the shareholders, suppliers of resources, and the consumers, who are affected by management strategies, but also the local community wider global society. MNCs and CSR in Developing Nations Quantitative empirical evidence of CSR While investigating the commitment of multinational managements toward CSR, it is helpful to place the issue in the framework of multinational corporate conduct in general, and to take into account those factors usually left unaddressed by researchers of multinational conduct. Some of these factors are, the conditions in the nation in which the multinational company operates, the general factors impacting worker issues in less-developed nations, and the impact of expanding global communications on the interplay between multinational corporations and the people they hire as workers. MNCs are investing in almost all the areas of the world, from mining to fashion to agriculture. Consequently, there is an ever-increasing risk of their entry into conflict-prone zones. There is also a risk of the outbreak of violent conflict linked to certain corporate activities. As the concern about how companies interact with their political and social environments abroad increases, so to does the concern for the development of comprehensive Corporate Social Responsibility strategies. Snow (1979) has noted that (1) that MNC factory investments actually decrease overall job opportunities in a poor nation, and (2) that the jobs which are created are not particularly useful for ongoing national development or for the individuals employed. Another objection is that by modernizing production, MNC factories put traditional producers and crafts workers out of business, and it does so not simply one-for-one, but exponentially. As production is streamlined and automated, fewer workers are needed. For example, the influence of globalization of technology on developing countries has been dramatic (Archibugi & Pietrobelli, 2003). The use of travel, media, scientific, technical workshops and the Internet as well as other communication channels provides an efficient transmission of knowledge at a much more rapid pace than has occurred in the past. However, this increase in availability of generated knowledge does not mean that developing nations will automatically benefit from such advances. Instead, it appears that the characteristics of the technology and the corporate social policies that are implemented across the globe, and not just in developing or developed countries separately, will modulate its affects. As the global trend in the transmission of skills, knowledge and technological competencies increases, its value to the world market economy grows from strength to strength. Technology is grounded in the systematic science of empirical research, and evidence-based commodities are developing into an important component of world trade, foreign direct investment (FDI) and subsequently for MNCs to transmit innovation across the globe (Archibugi & Pietrobelli, 2003). As new opportunities arise for developing nations to benefit from knowledge stocks, it is becoming clear that these nations are not fully participatory, and that it is necessary for MNCs and to take greater responsibility in ensuring that knowledge flows are limited in their impact on local technological capabilities with regard to ways of being that define the host nation as a socio-cultural entity. It is evident that the new opportunities from development offered through technological innovation must be tapered by deliberate policies and practices that actively engage endogenous learning to absorb the innovation. This approach has been supported by numerous other pertinent studies (Janne & Cantwell, 1999; Liu, Wei, Song, & Romilly, 2001). In the research paper, 'Impact Assessment Tools for Multinational Corporations,' (Goulbourne, 2003), concerns regarding socio-political interactions has been discussed in detail. As MNCs invest in other nations, they tend to exploit resources to sustain, grow and gain in profit. Corporate Social Responsibility requires the recognition that nation states and MNCs are two distinct regimes that operate in one global economy; consequently current relationships tend to be acrimonious. While the nation state looks forward to the well being of its people, the MNCs look forward to the interests of their shareholders without necessarily accepting the direct responsibility of their actions. This catalyzes the conflict situation between the two entities. When an MNC makes headway into another country, all may appear positive. However, with time as the MNC expands their operations problems do arise, such as when MNCs invest in conflict-prone areas, Royal Dutch Shell in Nigeria or British Petroleum in Colombia, both of which have suffered damage to their brand image due to the alleged impact of their security arrangements on local communities. Talisman Energy, a Canadian oil company in Sudan, has attracted adverse publicity because of its security co-operation with the field's co-owner, the Sudanese Government, which Amnesty International has accused of grave and systematic violation towards the population of that area. A diagrammatic representation of various MNCs' investment in conflict zones in Figure 2 is an example of such occurrences. Figure 2. Direct investment flows from OECD member countries to selected risky states by year in USA dollars (Goulbourne, 2003, p. 187). Qualitative empirical evidence A series of articles on corporate governance and Corporate Social Responsibility appeared in The Ivy Business Journal (March/April, 2003). Discussing the nuances of corporate governance, they shed light on how Corporate Social Responsibility is becoming a popular norm for most corporations. Though the articles did express serious doubts over CSR being just another form of spin or public relations (i.e., greenwash), they did also cite certain relevant instances of effective implementation of CSR by some companies. Overall, the research provided discussed CSR as being run by three drivers. The first was the economics of reputation. This implied that CSR provided a company with brand image. Some companies were performing badly on account of human rights violation or irresponsibility towards the environment. Textile brand Gap and sports brand Nike suffered on the above grounds and saw a dip in their sales and profit. The second driver is the rapid growth of Social Responsibility Investment Funds (SRI). In the UK alone, SRI funds have increased by a factor of ten in the four years, 1997 to 2001. The third driver has been the blurring of the line between corporate governance and social responsibility, and a growing political consensus on the issue. There has also been a rise in shareholder activism (i.e., the use of their voting rights as shareholders for better execution of CSR). In essence, CSR is emerging in more mature markets of Southern countries, and so far surpasses countries where business cases are less evident (Ivy Business Journal, 2003). Even in advanced developing countries, CSR has remained confined to some select companies and has not penetrated into the business policies of small and medium enterprises. According to the World Bank there are about 1000 buyer codes that exist today and they are rapidly increasing. A study by the World Bank in 2003 have pointed out that duplication of codes disrupts or even prevents full implementation of social and environmental standards at the level of individual supplier. Moreover, inconsistent application of codes also creates a significant barrier to the implementation of CSR practices in global supply chains. Increasingly it is felt that the traditional top-down CSR strategies are not achieving improved CSR implementation and is not sustainable in the long run. Scope for Future Study Social responsibility and social responsiveness appear to be long-lasting concepts that all stakeholders and citizens of the globe must align themselves with. This does not mean that if there are parts of them with which one is not in full agreement that one should not try to do something to correct or modify them. Instead, the issue appears to be not whether a company should become involved in social responsibility activity, but rather how deeply a company should become involved in social responsibility activity. Every company most certainly must obey all social responsibility-oriented laws and requirements. They must also have a minimum code of morals and ethics to which all of their employees must agree and adhere; otherwise, each employee will establish and operate under his or her standards to the possible detriment of the company and society as a whole. Pertinent questions are; What does the notion of social responsibility entail How can it be measured Who are the stakeholders capable of carrying out the assessment Are existing legal requirements are sufficient to ensure that acceptable minimum standards that are achieved by all companies What additional initiatives can companies engage in, over and above legal minimum standards, and how can these be promoted Which degree of transparency is needed to make the process credible How can managers of social funds include or exclude companies from the funds Conclusion The very act of formulating business principles can be of great value in articulating a company's view of its place in society and what can and should be expected of it. Setting and implementing guidelines is not a once-and-for all affair, but a dynamic process. Once established, principles must be subject to continuous review to keep up with the times we live in and the expectations of all stakeholders, especially a company's customers. Corporate policies and their implementation need to be kept under constant review to keep abreast of developments in technology and scientific understanding, customer needs and wider societal expectations. It is for the company to assess its social performance through internal consultation and periodic review by management. Equally, it is the company's responsibility to check that its business principles are being acted upon. The extent and manner of external reporting of performance is, of course, for the company to decide. Given the wide differences between industries and individual companies, the contents of such reports are bound to vary. Various international initiatives are being undertaken to develop a common yardstick for voluntary reporting of the economic, environmental and social impact of company activity. An example is the work being done by the Global Reporting Initiative, which is supported by the UN and other international organizations, to agree on a set of common core indicators. They would enable investors and other stakeholders to make global comparisons. Companies should retain the flexibility to adapt such voluntary indicators to their particular circumstances. A key way for companies to create confidence and trust in their commitment to responsible business conduct is to provide timely and reliable information on their financial, environmental and social performance and to communicate this to their stakeholders. Markets all over the world provide examples of companies who enjoy sustained public goodwill and respect by doing this successfully. Also, government-mandated or other external codes are unlikely to be a viable alternative to voluntary business principles developed by the company itself, although these may have significant value as external benchmarks. Some companies choose to express public support for one or more of these external codes. It is for an individual company or industry sector to decide what the most useful benchmark codes are and to develop their own understanding of how business principles relate to external codes and guidelines, and to societal expectations. Support for external codes can be time-consuming since they may imply additional commitments. This document sets out why it is convincing that it is in a MNCs interest to make corporate responsibility a priority in today's competitive world of instant communication in which stakeholders have access to a wealth of information and enjoy an abundance of choice. Having stated the case for responsible business conduct, and its benefits to profitable business operations, this document aims to provide practical advice on how to make corporate responsibility to society as an integral part of business conduct. References Ackerman, R. (1975). The social challenge to business. Harvard Business Review, 51(4), 88-98. Archibugi, D., & Iammarino, S. (1999). The policy implications of the globalisation of innovation. Retrieved January 15, 2006, from http://www.danielearchibugi.org/downloads/papers/Globalisation_of_techn_and_science/Policy_implications.pdf Archibugi, D., & Pietrobelli, C. (2003). The globalisation of technology and its implications for developing countries: Windows of opportunity or further burden Retrieved January 15, 2006, from http://www.danielearchibugi.org/downloads/papers/Globalisation_of_techn_and_science/Globalisation_of_technology.pdf Brown, R. L., & Holmes, H. (1986). 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The Ivy Business Journal, (March/April), Retrieved on December 6, 2006, from http://www.questia.com The World Business Council for Sustainable Development (2006). Ecosystem Challenges and Business Implications. Retrieved January 15, 2006, from http://www.wbcsd.ch/templates/TemplateWBCSD2/layout.asptype=p&MenuId=ODU&doOpen=1&ClickMenu=RightMenu Twose, N. & Cramer, A. (2004). Corporate Social Responsibility Initiatives [Message 2], Message posted on http://rru.worldbank.org/Discussions/Discussion.aspx Summary Table Lantos (2001) The international community requires that those participating in the market economy must take greater responsibility and be accountable for the outcomes of globalization that the MNCs contribute to; these include social, cultural and environmental outcomes. Carroll & Carson (2003) MNC public policy needs to be realized as essential to the best practices of strategic management, and in the goal of achieving a competitive market edge. This requires management to introduce inclusive policies and practices that are orientated toward honesty, integrity and openness of operations, and a commitment to the rights and dignity of all stakeholders, who are both directly and indirectly associated with the company. Archibugi & Iammarino (1999) Within developing nations MNCs must be aware of their power to influence host government policies and practices, and MNCs must be responsible and accountable for the power that they have by virtue of their investments in the host nation. Carlsson & Mudambi, 2003 MNCs need to act as citizens in the host nations, and actively seek to fully participate in the communities of which they are a part of. Such participation includes aligning corporate values with the socio-cultural norms of the host nation. Goyder (1951) Industry is no longer about benefiting shareholders alone. The scope of the global market is much broader, and industry must acknowledge the joint enterprise and inclusive practices that are required to integrate the needs and expectations of workers, management, consumers, locality, trade unions, government, and the wider global community. Friedman (1962) Felt that CSR extended only to shareholders and to the goal of profit making to benefit shareholders. Further, that extension of the role of CSR beyond the shareholders actually undermine democratic processes that enabled a free society. Ackerman (1975) Promotes a three stage process of social responsiveness of companies; acknowledgment of social issues, critique and evaluate the issue, and finally implement a socially responsible program. Halal (1977) Developed the 'return-on-resources model of corporate performance' requires companies to be aware that CSR will always be value laden, and that acknowledgment of this fact will aid in more comprehensive consideration of policy and practice evaluation and changes. Steiner & Steiner (1991) Companies need to be aware of social issues and to realize that strategic management and competitive edge necessitates the exploring, evaluation and remedy of social concerns pertaining to the company. Carrol (1991) Developed the ' three-dimensional conceptual model of corporate performance' to describe the orientation toward CSR; this involves economic, legal/ethical and discretionary responsibilities considerations. European Commission (2002) Developed the Green Paper in 2001 to delineate the two dimensions of CSR; internal and external. And so realize that companies have social responsibilities by virtue of being a part of a society. Cherian (2000) Advocated for collective action; recognizing that it is not only the shareholders, suppliers of resources, and the consumers, who are affected by management strategies, but also the local community wider global society. Archibugi & Pietrobelli (2003) Focus on technological innovation as an example of the need for CSR among MNCs, especially with regard to developing nations. Companies need to be aware that transmission of knowledge, skills and competencies does not automatically means that the host nation will benefit. Goulbourne (2003) Corporate Social Responsibility requires the recognition that nation states and MNCs are two distinct regimes that operate in one global economy; consequently current relationships tend to be acrimonious The Ivy Business Journal (March/April, 2003) Acknowledges the trend for companies to adopt a more focused view of CSR in policies and practices. The three primary reasons identified for this adoption are; the economics of reputation, the increase of Social Responsibility Investment Funds, and the blurring of the line between corporate governance and social responsibility, and a growing political consensus on the issue. Read More