Some studies have revealed the difference in CSR practice among countries (Matten &
Moon 2008, Maignan &Ralston 2002). There is a difference in the level of dedication to being perceived as socially responsible, and the emphasis on CSR issues and their level of importance (Maignan & Ralston 2002). This is particularly important nowa-days, as companies are operating in different countries and continents, and such a dis-tinction in comprehension and practice can result in conflicts and challenges. Thus, the factors that contribute to such differences will be discussed.
Factors affecting CSR in practice
While there are some disagreements regarding the definition of CSR, the understanding and practicing CSR vary among countries due to other factors. According to Whitley (1997) every country has historically grown institutional framework which shapes and constitutes a “national business systems” (NBS) (Matten & Moon 2004, 348). Some theories including this concept were adopted by Matten and Moon (2008), who have devised a framework for the comparative analysis of the corporate social responsibility in order to identify the reasons of the distinctions. The comparison was based on the United States and Europe. The authors claim that there is a difference between North American and European CSR, however, the evidence suggests the US-style of CSR is spreading to Europe. Matten and Moon have argued the US-style of CSR is a more
explicit form of the corporate responsibility, while the European countries are less mo-tivated in adopting an explicit CSR style. Therefore, two elements of CSR, the explicit and implicit, have been distinguished.
Explicit CSR refers to the form of the corporate policies that usually involve voluntary programs to address issues perceived as the social responsibility of the company. It is usually turns into a strategic decision of the corporation and motivated by the expecta-tions of different stakeholders. Implicit CSR consists of values, codified norms and rules that form rather mandatory and customary requirements and obligations of corporations to address stakeholders` issues (Matten & Moon 2008, 409).
The conceptual framework for a comparative analysis, devised by Matten and Moon, identifies the key features causing the distinction among countries. The features are the following.
Political systems focus on the power of the state and the engagement of gov-ernments in the economic and social activities.
Financial systems define the stakeholders that play an important role to corpo-rations [stock markets as the main source of obtaining the capital (more common in the US), which makes corporations more accountable to shareholders-inves-tors, compared to banks (more of the case in Europe) and the European model of stakeholders].
Educational and labor systems illustrate the levels (national versus corporate) of resolving the issues related to education and labor (eg, in the US education has become the area of strategic decisions, as the presence of American govern-mental policies are relatively weak, as well as the role of unions in the US is weaker than in Europe).
Cultural systems involve the level of reliance on representatives like political parties, unions and associations, churches and the state (Matten & Moon 2008, 407-408).
FIGURE 1: CSR and Institutional Context of the Corporation. (adapted from Matten & Moon, 2008, 413)
Matten and Moon (2008) have also argued the four features influence on the national business systems (NBSs), in terms of the nature of the firm, the organization of market processes, and coordination and control systems.
Nature of the firm focuses on the form of ownership coordination. For instance, the authors compared the contract-based ownership, more common in the An-glo-Saxon countries, and a direct ownership through networks of banks and in-surance (Matten & Moon 2004, 348). Such a distinction can result in the ac-countability of the firms to different stakeholders. Contract based ownership makes corporations more susceptible to be responsible to shareholders (inves-tors), while direct ownership implies a more expanded list of stakeholders be-yond shareholders (Matten & Moon 2008, 408).
Organization of market processes represents the economic relations that is constrained between two extremes: markets and alliances. This feature is im-portant for CSR as it touches upon the issues like consumer protection, product stewardship, and liability for products (Matten & Moon 2008, 408-409).
Coordination and control systems characterize the employer-employee rela-tions involving the degree of trust, the level of employees’ autonomy, and the
degree of managers’ responsibility towards employees (Matten & Moon 2008, 409).
Other components of the framework developed by Matten and Moon are the drivers of an explicit CSR. They have identified the following drivers.
Coercive isomorphism is a response (a change) to the pressure from the party that the corporation may depend on or to the pressure derived from the expecta-tions of the society. The codified rules and norms produced by other actors com-pel corporations to adopt the initiatives like a code of conduct, or the compliance with environmental regulations (Matten & Moon 2008, 411-412). For example, clients and customers may expect and demand from corporations to adopt ISO-standards.
Mimetic processes occur when a corporation tries to imitate (mimic) the prac-tices of other organizations, usually in an uncertain or complex environment.
Normative pressures refer to the change occurred in an organization due to the standards set by educational or professional bodies (Matten and Moon 2008, 412). For instance, educational programs for managers that have the same con-tent for different organizations.
This model is particularly useful, as it provides the framework for the analysis of the factors and drivers influencing the company’s choice to practice CSR, and the choice of doing so explicitly or implicitly.
CSR in the Russian context
Kuznetsov et al (2009) have studied CSR in the Russian context. The authors identified the economic and financial situations that may partly explain the institutional frame-work in Russia in relation to CSR. In the 1990s, the privatization of public assets in Russia was a questionable and dark business, which resulted in financial damage, and in the tarnished reputation of business. The corporations’ status of legitimacy and re-spectability is still an issue in Russia. The author cited the results of public opinion polls supported the common perception that the stigma of fraud and corruption surrounds the Russian market (Levada-Center 2006). The business success correlates to the fraud in the minds of the Russians. The lack of trust is prevalent between the people, business
and the state, which is the critical aspect for the country. More recent public opinion polls show only 11% of Russians believe the business runs honestly, while others think the violations and torts are inevitable in making profit. At the same time, the attitude towards business in Russia is improving. It can be possibly explained by the fact that new post-soviet generation has come, who are free from the bias towards a business, as well as the improvements of the economic situation of Russians is a result of the con-tribution of a business. In other words, it is assumed that Russians see the benefits for the society because of a business (Churakova 2014). The authors, who investigated the CSR in the Russian context, suggest the Russian companies have to overcome the un-favorable image. Moreover, the existence of the state in the market is challenging for companies (Kuznetsov et al. 2009, 39).
The same research has found several key aspects. First, the interpretation of CSR is different in Russia in comparison to the Western countries. While the compliance with laws and regulations is perceived to be the norm and is not regarded as something spe-cial, the study of the Russian firms draws a different picture. Paying the taxes and offi-cial wages on time, abiding the law are the popular choices of the representatives of the Russian firms answering to questions about responsible business practices. At the same time, in the Russian weak institutional environment, the compliance with the laws and tax regulations is suggested to be a manifestation of CSR in the Russian context. The survey also revealed the financial component has the highest importance for the Russian managers. In other words, the Russian firms favour profit-maximizing activities, while the environment and society are not prioritized. The explanation can be found in the weak economic freedom, corruption, and insecurity of property rights (see more Kuz-netsov et al. 2009). Another challenge of incorporating the social responsibility into the Russian firms is their desire to be separate from the state, but engaging in social activi-ties may create a wrong impression (Kuznetsov et al. 2009, 41-44).