Corporate Social Responsibility Preferences in South Africa

Abstract

What leads firms in South Africa (SA) to prefer specific CSR initiatives over others? The researchers analyzed secondary data from publicly available information of 231 listed firms on the Johannesburg Stock Exchange. To determine national/institutional level preferences, ten CSR activities were identified among all firms and ranked in terms of their mean score of whether each firm participated in an activity or not. To determine industry/stakeholder influence, CSR activities were regressed against the firms’ industry. The preference for two CSR activities, education and training and enterprise development, are common across industries. This demonstrates the institutional effect of SA’s national Black economic empowerment (BEE) policy, which promotes such activities. Charitable donations, infrastructure provision, employee voluntarism and efforts in arts, culture and sports prevail in certain industries. The preferences of firms in the mining and construction industries stand out relative to other industries. Managers have to carefully select CSR activities that respond to various societal pressures. We show an example of management responses to pressures arising from both the national and industry level context. The study is the first to rank CSR activities of South African firms. We also reveal the promise of institutional theory to examine the phenomenon of CSR in the South African context.