Professional Documents
Culture Documents
Introduction
The topic of the social responsibilities of business has
been a subject of intense controversy and interest
over the past three decades. In part, this debate is an
outgrowth of the proliferation of different conceptualizations of corporate social responsibility (CSR).
The term CSR has indeed been defined in various
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Ethical Responsibility
Legal Responsibility
Economic Responsibility
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217
Employees
Suppliers
Customers
Community
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A stakeholder approach was also used by Papasolomou et al. (2005) in the context of Cypriot
businesses. Their rationale for using a stakeholder
approach is that stakeholders invariably affect or are
affected by business organizations and therefore can
be seen as imposing on them different responsibilities. They identify six groups as key stakeholders
including employees, customers, investors, suppliers,
the community and the environment and delineate
relevant CSR actions vis-a-vis each cluster respectively as illustrated in Table III. Their findings suggest that Cypriot firms accord the most attention to
employees and consumers in their pursuit of CSR,
moderate attention to the community stakeholder,
TABLE III
CSR actions vis-a-vis key stakeholders (Papasolomou et al., 2005)
Stakeholder
Employees
Consumers
Community
Investors
Suppliers
Environment
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turn an exclusive focus on shareholders. The language of stakeholder theory was also easier to grasp
by managers/practitioners as most organizations
understood and defined obligations and responsibilities vis-a-vis their traditional stakeholders (Clarkson,
1995). Stakeholder theory seems also easier to
maneuver in collecting and analyzing CSR data as
evidenced by the proliferation of empirical studies
that have essentially integrated a stakeholder approach as outlined in the previous section. This
stream of research has also led to the delineation of
relevant stakeholder issues and associated measures of
impacts, which, with further refinement, can serve as
useful guidelines for managers in their pursuit of
CSR actions and interventions (Davenport, 2000).
The next section highlights how a stakeholder CSR
approach the EPS proposed by Spiller (2000) was
used to collect and analyze CSR data in the context
of a sample of Lebanese and Syrian firms, allowing in
turn to draw relevant implications regarding the
usefulness of a stakeholder CSR approach.
Research methodology
Research hypotheses
The research methodology is consistent with
descriptive stakeholder theory, which seeks to
outline participants views of what the business
organization is doing vis-a-vis its stakeholders, as
well as the mechanisms through which different
views come into being (Brickson, 2007). This
descriptive stakeholder methodology will be supplemented in turn by reference to the two other
veins of stakeholder theory, namely instrumental
stakeholder theory and normative stakeholder
theory. In the framework of these three branches of
stakeholder theory, the following research hypotheses are derived and tested after being presented here
in the context of the corresponding CSR literature
in which they are respectively anchored.
Developing country firms prioritize their stakeholders based primarily on
instrumental considerations.
Hypothesis 1 (H1)
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Hypothesis 2 (H2)
Hypothesis 3 (H3)
Hypothesis 4 (H4)
Hypothesis 5 (H5)
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TABLE IV
Sample profile
Company name
Type of industry
Lebanese sample
Company A*
Company B
Company C*
Company D
Company E
Company F
Company G*
Company H
Company I*
Company J*
Company K*
Company L*
Company M*
Financial services
Banking and financial services
Banking and financial services
Banking and financial services
Insurance
Internet services
Multimedia services
Food and beverage
Food and beverage
Hospitality
Hospitality
Tobacco
Pharmaceuticals
Company N
Syrian Sample
Company O
Company P
Company Q
Telecommunications
Telecommunications
Management information systems
Company
Company
Company
Company
Company
R
S
T
U
V
Line of business
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TABLE V
The EPS (Spiller, 2000)
Stakeholder
Community
Environment
Employees
Customers
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TABLE V
continued
Stakeholder
Suppliers
Shareholders
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Research findings
The EPS ratings for each of the case study companies
are presented in Tables VI and VII. These ratings
are not intended as a definitive statement of the
performance of the companies vis-a-vis core stakeholders, but simply report the findings compiled
based on the interviews conducted. The EPS results
reflect the pioneering work of Company A, which
stands out for its successful balancing of the interests
and concerns of all six stakeholder groups. It also
reflects the consistent efforts of Company L at
managing successfully the spectrum of stakeholder
relationships. A question arises here as to whether
the legitimacy of CSR practices can and should be
questioned because of the nature of the industry in
question (e.g. tobacco).
As illustrated in Table VI, the EPS scores for the
companies operating in Lebanon (both national and
international) have ranged from a low of 40 to a high
of 114, with an average EPS score of 73. The purpose here is not to consider the EPS scores as
reflective of aggregate social performance, but rather
to gauge stakeholder management patterns vis-a-vis
the different stakeholders. Companies operating
in Lebanon seem to be according the most attention
TABLE VI
Ethical performance scores Lebanese sample
Company Name
Company A*
Company B
Company C*
Company D
Company E
Company F
Company G*
Company H
Company I*
Company J*
Company K*
Company L*
Company M*
Company N
Lebanese sample averages
Community
Environment
Employees
Customers
Suppliers
Shareholders
Total EPS
14
2
9
12
10
5
3
13
9
15
10
10
10
13
10
20
)2
13
)5
)9
0
0
7
12
4
4
18
2
12
5
20
14
15
8
16
17
12
20
18
18
18
20
20
17
17
20
13
14
13
16
18
9
20
19
16
12
18
18
10
16
20
7
6
7
13
4
6
17
17
14
5
18
14
11
11
20
16
13
9
20
6
10
18
15
16
12
19
16
13
15
114
50
70
44
66
50
40
95
90
83
61
103
80
76
73
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TABLE VII
Ethical performance scores Syrian sample
Company Name
Company O
Company P
Company Q
Company R
Company S
Company T
Company U
Company V
Syrian sample averages
Community
Environment
Employees
Customers
Suppliers
Shareholders
Total EPS
13
18
10
12
)1
11
6
5
9
1
10
)2
6
14
9
12
)16
4
17
18
20
16
8
4
15
6
13
13
18
17
6
9
9
19
16
13
11
14
17
7
0
10
13
10
10
17
20
4
13
0
5
10
9
10
72
98
66
60
30
48
75
30
60
Discussion of findings
An investigation into the application of the
stakeholder approach in the Lebanese and Syrian
contexts suggests a number of interesting findings
and insights. This section will dwell on the findings
TABLE VIII
A comparative benchmark Lebanese vs Syrian samples
Community Environment Employees Customers Suppliers Shareholders Total EPS
Lebanese sample (including *) 10
Syrian sample
9
Lebanese sample (excluding *) 9
Syrian sample
9
* Subsidiaries of International Corporations
5
4
1
4
17
13
15
13
16
13
15
13
11
10
10
10
15
10
14
10
73
60
64
60
Hypothesis 1 (H1)
Hypothesis 2 (H2)
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Hypothesis 3 (H3)
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Hypothesis 4 (H4)
Hypothesis 5 (H5)
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Note
1
With the exception of Reuters, which could be accounted for in light of the nature of the industry (news
provider) and the relatively small size of the subsidiary
firm (comprising only 25 employees).
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