CSR and stakeholder salience in MNE subsidiaries in emerging markets

Abstract

The purpose of this study is to identify the key stakeholder groups pressuring multinational enterprises (MNEs) in emerging markets (EMs), also if the pressure is global or local, to develop corporate social responsibility (CSR) strategies. Drawing on stakeholder salience and institutional theories, all the stakeholder groups acknowledged and analysed in the literature were identified and examined to understand if they were perceived by MNEs in China as effective in pressuring them to engage in CSR strategies and activities. Results demonstrate that only stakeholder groups with power – government power or voting power – are perceived as having enough pressure to make MNEs’ Chinese subsidiaries engage in CSR, which is contrary to current theories. Our results allow us to theorise on an extension of the concept of utilitarian power and political power when analysing stakeholder salience in EMs. This research has important implications for managers as balancing and working with limited resources and correctly identifying and prioritising key stakeholders are vital to successfully improving performance.