Why do corporate responsibility meanings and practices vary?: Exploring culturally and structurally embedded corporate agency in Australia and Mongolia

Abstract

Firms adopt various corporate responsibility (CR) meanings and practices. Uncovering the underlying causal mechanisms that lead to this variety is, I argue, critical for contributing to the theoretical debate about how CR is a product of both a firm’s agency (i.e., reflexive action) and contexts that embed it (i.e., embedded agency), as well as the practical debate about how to identify and develop new, more effective and socially positive CR meanings and practices. The extant institutional studies of CR – specifically, studies drawing on the comparative institutional and institutional logics perspectives – have begun to theorise this variety as an outcome of firms’ different forms of agency that is embedded in different institutional (i.e., norms, rules, laws and customs) and field settings (i.e., power struggles between these firms and their stakeholders). While these two streams of literature have yielded some important insights into what can cause variety in some forms and foci of CR meanings and practices, they have remained fragmented and separate and so do not offer a complete explanation for why we observe variety in CR meanings and practices. I argue that this incompleteness results from that these institutional perspectives are limited to explain causal mechanisms of CR as a firm’s culturally and structurally embedded agency – or how institutional and field settings and a firm’s agency interplay as distinct yet interdependent entities in informing its CR meanings and practices.

In this study, I fill this research gap both conceptually and theoretically. First, drawing on the insights from the institutional logics perspective, the theory of strategic action fields (SAFs) and the morphogenetic approach, I develop a conceptual framework that offers an alternative, more comprehensive approach to thinking and organising empirical observations on CR as a firm’s culturally and structurally embedded agency. Then, I apply three research questions derived from my conceptual framework to develop empirically driven theorisation of why a mining multinational corporation (MNC) adopts various – in terms of their openness and room for future amendments (i.e., flexible or locked-in) – cross-sector partnership practices around its responsibility towards communities (i.e., impact mitigation and community development practices) both within and across the developed liberal economy of Australia and the developing state-led economy of Mongolia. Framing MNCs’ CR towards communities as the outcome of contestations between MNCs and their stakeholder-challengers (such as, for instance, community NGOs or local and state governments), I identify the crucial role of ‘political reconciliation structures’, which I coin as specific institutional and field arrangements, within which stakeholder-governance units (such as, for instance, international financial organisations or community consultancies) assist, or reconcile, these contestations. This study conceptually and theoretically contributes to the institutional analysis of CR, the institutional logics perspective, the SAF theory and the morphogenetic approach. Also, it has several practical implications for community managers of MNCs, managers of stakeholder organisations, as well as policymakers.