Academic journal article Journal of Managerial Issues

A Cross-National Analysis of Corporate Citizenship: Saudi Arabia vs. the United States

Academic journal article Journal of Managerial Issues

A Cross-National Analysis of Corporate Citizenship: Saudi Arabia vs. the United States

Article excerpt

One of the fastest growing themes related to Corporate Social Responsibility (CSR) is the notion of Corporate Citizenship (CC). While many researchers have focused on CSR-related concepts such as environmental issues, transparency, and ethical guidelines, there has been a limited body of research related to CC in an international context (Maignan and Ferrell, 2000; Pies et al., 2010; Ozen and Kusku, 2009; Sison, 2009). Moreover, in the Middle East, very little research has been published on CSR in general and CC in particular. Although scholars have argued that CC is an extension to the body of literature that falls under the CSR realm (Marten and Crane, 2005; Ozen and Kusku, 2009), the extent to which CC has become an established area for business and government remains unclear. To clarify the context within which the term Corporate Citizenship is used, the definition proposed by Matten and Crane is employed, "Corporate Citizenship describes the role of the corporation in administering rights for individuals. Hence we concur with the acknowledgement that the corporation administers certain aspects of citizenship for other constituencies." (2005: 173).

A significant event for the CC movement was the joint statement that was issued by CEOs from 34 of the world's largest firms in 2002 (Matten and Crane, 2005). In their mandate titled, "Global Corporate Citizenship: The Leadership Challenge for CEOs and Boards," executives from firms such as Deutsche Bank and Coca-Cola attempted to raise the bar for corporate governance standards while increasing awareness in the global public arena. Many large MNCs have now published formal statements related to their CC posture. Examples include ExxonMobil, "We pledge to be a good corporate citizen in all the places we operate worldwide" and Toyota, "With the aim of becoming a corporate citizen respected by international society, Toyota is conducting a wide range of philanthropic activities throughout the world" (Matten and Crane, 2005).

Corporations and governments of developing economies have also become increasingly appreciative of the importance of CC as well. As Levine (2008) notes, China's stock exchanges and agencies have started issuing regulations on corporate social responsibility, which are providing businesses in China a new incentive to implement CSR and CC-related programs. Failure to abide by CSR standards may result in fines and punishments in China. Indeed, major Chinese stock exchanges have issued guidelines that encourage firms to assume responsibility for social development, protect the natural environment and other resources, and commit to advancing the interests of multiple entities such as shareholders, creditors, employees, customers, consumers, and others involved with their business. A similar pattern has occurred in other developing and emerging economies, and the rise of multinationals in the Middle East has attracted the interest of many scholars and practitioners (Mellahi et al., 2011). For example, the recent requirements set forth by the Capital Market Authority in Saudi Arabia embody the trajectory of this movement in the Middle East. Nonetheless, the extent to which managers from developed and emerging economies vary in their perceptions of corporate citizenship principles is essentially unknown.

To ground this study in an established framework, Davenport's (2000) principles of corporate citizenship are utilized. Davenport (2000) employed a stakeholder approach to defining corporate social performance and developed valid measures to assess her theoretical premise. Prior to Davenport's (2000) work, academicians had struggled with appropriate methodologies that could be used to measure CSR and other social performance indices (Maignan and Ferrell, 2000). Davenport (2000) utilized a Delphi survey approach and interviewed 169 experts to ascertain their opinions related to the most fundamental principles related to Corporate Citizenship. …

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