Political embeddedness and corporate social responsibility (CSR) in a state-led developing country: evidence from China

Abstract

In many countries, the government plays a regulative role in corporate social responsibility (CSR) as an external overseer of economic and public market sectors. However, owing to the politically embedded nature of extensive corporations in China, the government's influence over CSR is not only exogenous but may even endogenously shape the general scope of CSR of companies in comparison to the West. To date, this has not been extensively examined. We explore this from the standpoint of the scope of beneficiaries and CSR domains, which accurately depict the welfare effects of business in developing countries. Based on a resource dependence perspective, we conduct a quantitative content analysis on a sample of 160 Chinese listed companies and developed a two-level model of political embeddedness. The results show a complex interaction between politics and business, revealing the opposing influence of political embeddedness at different levels.