A comparative analysis of corporate social responsibility in the strategic planning of South African and Australian Companies

Abstract

Corporate social responsibility (CSR) has assumed a place in the forefront of every stakeholder's thinking. Particularly the recent global financial crisis has led to a resounding debate among the corporate sectors about their role and responsibility towards their stakeholders. Firms can enhance their corporate profiles with investors by addressing stakeholder demands. Due to their good global reputation and high global ranking, JSE listed companies are expected to be seen as socially responsible and managing CSR issues proactively. Literature indicates that formal strategic planning and firm humanistic culture guide management in determining appropriate strategies for the organization to address stakeholder demands for CSR that could lead to benefits for the organization. Hence, the study aims to determine to what extent JSE listed companies consider formal strategic planning and humanistic culture into CSR practices to address stakeholder demands for CSR. Furthermore, CSR literature suggests that CSR activities in the country depend on country's economic development and social needs which are different from one country to another. Hence, the study aims to compare CSR demonstration between a developing and non-OECD country (i.e. South Africa) and a developed and OECD country (i.e. Australia) in the context of formal strategic planning, humanistic culture and different national perceptions. CSR, formal strategic planning and humanistic culture are measured using multiple scale items with a five-point Likert scale. Confirmatory factor analysis was performed to test the hypotheses. In addition, an extensive search of South African and Australian literature is conducted to outlined similarities and differences between the two countries. Results show that JSE listed companies are very positive about CSR practices in order to satisfy the stakeholder demands for CSR. Findings reveal that the majority of JSE listed companies

strongly emphasized the use of the multiple inputs in the formal planning process and reported a strong demonstration of humanistic culture in the workplace. The study reveals that all items of formal strategic planning and humanistic culture are statistically significant and positively linked to CSR. Due to the similarities that exist in both countries, this study postulates that companies' perceptions of CSR demonstration in South Africa and Australia emerge in a similar manner that leads to a similar motivation for adopting CSR into company practice in both countries. The study also reveals that CSR activities in these two countries are demonstrated through different perspectives and approaches due to the fact that the two countries social demands are developed on very different levels. Thus, this study posits that informational differences have different effects on CSR. Following the data analysis, this study developed a new CSR framework to enhance CSR demonstration in order to improve firms ' CSR performance which may lead to attracting more investors. This comparative study contributes a deep intuitive knowledge of the companies' perceptions of CSR demonstration with respect to formal strategic planning and firm culture in two different jurisdictions (OECD and non-OECD). However, the study posits that much work needs to be done for South African companies to engage in more CSR activities and practices that can make them good corporate citizens which is very important for purposes of accountability and sustainability.