The impacts of institutional distance on corporate social responsibility "glocalisation" : evidence from international construction

Abstract

Recent years have seen burgeoning construction activities expanding into the international arena. Simultaneously, international construction companies (ICCs) are faced with growing concerns for various global or local issues, such as climate change, human rights, and poverty. ICCs have to strategically deal with these global and local issues to sustain and win in a competitive business world. When setting in international markets, their corporate social responsibility (CSR) implementation will be more complicated. It has been observed that ICCs adopt various “global” and “local” CSR strategies. Borrowing the term “glocalisation”, this thesis is probing into the CSR phenomenon in international markets. Intuitively, apart from the impacts of the institutional environment from host countries, countries-of-origin should have an influence on ICCs’ CSR practices. CSR is conducted with the needs to be localised to gain legitimacy in host markets on the one hand, and to address issues with the worldwide considerations on the other. The aim of the research is to explore the relationships between institutional distance of home and host countries and ICC’s CSR, particularly CSR “glocalisation” patterns.

By conducting content analysis with both text mining and manual coding approaches, patterns of CSR practices are described and classified into four types involved in CSR “glocalisation”: CSR globalisation, standardisation, localisation and contextualisation. CSR globalisation describes a pattern that CSR practices are seldom mentioned in the overseas markets; CSR standardisation describes a pattern that CSR practices are widely emphasised over almost all the host markets; CSR localisation describes a pattern that CSR practices are conducted largely depending on host countries; and CSR contextualisation describes a pattern that CSR practices are widely emphasised over the host markets but in different forms adapting to the local environment.

Mixed research methods combining a quantitative approach such as logistic regression with a qualitative approach based on content analysis are then applied to explore the research aim. It is found that the institutional distance has impacts on the patterns of CSR glocalisation, by affecting (1) the market choice of ICCs, (2) establishment of legitimacy, (3) willingness or the ability of ICCs to conduct CSR. The institutional distance has (1) no impacts on CSR globalisation, (2) negative impacts on CSR standardisation, (3) negative impacts on CSR localisation, and (4) positive impacts on CSR contextualisation. It is also tested that the CSR glocalisation would be promoted by the degree of internationalisation of ICCs, but have no statistically significant relationships with the firm size of ICCs.

This research has significant scholarly, practical and methodological impacts. On the academic sphere, it brings new insights by proposing the construct of CSR “glocalisation” to refute the “one-size-fits-all” view that ICCs implement either global or local CSR, and by considering both sides of the home and host countries. On the practical side, this research gives ICCs a view on how to make behaviour plans in international markets in the CSR-desired world. This research also makes methodological contributions by incorporating text mining approach in the content analysis for CSR reports, and test the hypotheses by using mixed methods.