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How corporate social responsibility and sustainable development functions impact the workplace: A review of the literature

This report sets out to analyse the emergence and distinctive impact of corporate social responsibility and sustainable development (CSR/SD) functions and professionals within organizations. By evaluating the literature on this topic, it seeks to clarify how leveraging the already established CSR/SD functions and professionals across organizations can contribute to the International Labour Organization’s (ILO) objective of achieving a future of work that provides decent and sustainable work opportunities for all.

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• Published: 26 April 2023

Exploring the factors affecting the implementation of corporate social responsibility from a strategic perspective

• Chao-Chan Wu   ORCID: orcid.org/0000-0002-3891-310X 1 ,
• Fei-Chun Cheng 2 &
• Dong-Yu Sheh 1  

Humanities and Social Sciences Communications volume  10 , Article number:  179 ( 2023 ) Cite this article

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In general, the objective of a company is to pursue higher returns for its shareholders. Corporate social responsibility (CSR) is an ethical practice that seems to be contrary to the objectives of companies; as a result, companies lack sufficient motivation to implement CSR. Academics and practitioners have recently begun considering CSR from a strategic perspective. However, the definition and scope of strategic CSR have not been clearly defined or discussed in previous studies. This study uses the strategic triangle perspective as a theoretical basis to explore the key factors affecting the implementation of strategic CSR. Three main factors and ten sub-factors were summarized to form a hierarchical network structure based on a literature review. The weights of each factor and sub-factor were then prioritized using the analytic network process (ANP). The results of this study show that “company” is the most important main factor, while “corporate image”, “innovation ability”, “reputation risk”, “financial capacity”, and “investment intention” are the top five important sub-factors. The hierarchical network structure and critical factors suggested in this study contribute to implementing strategic CSR. The findings of this study will also help the theoretical development in the field of CSR.

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Introduction

The purpose of businesses is to produce products or services that meet consumer demand. However, with the depletion of resources and environmental pollution, people have gradually realized the importance of sustainable development. Furthermore, with better living standards, people pay attention to social issues such as health and human rights. Various factors have led to higher expectations regarding the role of businesses in society (Huang, 2014 ). In addition to their growth, companies need to consider the overall well-being of society and make moral contributions beyond economic and legal aspects. Enterprises are not only economic entities that operate for profit but also exist to create an ideal society (Carroll and Shabana, 2010 ). Therefore, corporate social responsibility (CSR) has become an important research topic in recent years (Yuan et al., 2020 ).

The motivation for CSR implementation changes with the social environment (Bergquist, 2017 ). The goal of an enterprise is to make profits and maximize shareholder value. Thus, it is necessary to establish formal regulations to enforce the implementation of environmental protection and social issues by enterprises. Nevertheless, if CSR is merely a response to legal requirements, companies will not realize the value and benefits of this action. For organizations such as businesses that pursue economic benefits, implementing CSR may be viewed as a cost. This reactive motivation prevents companies from effectively implementing CSR (Bansal, 2022 ).

Social responsibility and corporate benefits do not conflict. This means that companies should not treat CSR as an expense incurred by contributions to fulfill public interest. Instead, companies should transform CSR from an ethical practice to one of their strategies (Porter and Kramer, 2006 ). If CSR is combined with a company’s strengths and strategies, its potential will maximize the benefits to society and the company (Branco and Rodrigues, 2006 ; Yuan et al., 2020 ). A strategic vision of CSR will allow companies to avoid seeing it as a cost or expense when implementing CSR, but will instead consider the relationship between CSR and the company’s core business and how to help the company achieve its strategic goals (Lepoutre and Heene, 2006 ; Manasakis, 2018 ). Strategic CSR can help companies achieve a win-win situation regarding economic benefits and social responsibility.

To implement strategic CSR, companies must identify the capabilities and resources that influence their social responsibility (Branco and Rodrigues, 2006 ). In addition, resources are limited to businesses, so selection and prioritization are important parts of strategic thinking (Porter, 2008 ). Identifying the key factors affecting the implementation of strategic CSR and recognizing the relative importance of these factors will help companies plan their strategic CSR activities. Therefore, it is important to explore the key factors that influence the implementation of strategic CSR. According to the strategic triangle perspective proposed by Ohmae ( 1982 ), the strategic thinking of a business is mainly based on company, customer, and competitor aspects. From the company aspect, the main description is the importance of internal resources in implementing a strategy. The customer aspect focuses on how a company uses its resources to provide attractive products and services to satisfy its customers. The principle of the competitor aspect is that a company should create as much competitive advantage as possible to enable it to compete with its competitors (Ohmae, 1982 ; van Vliet, 2009 ). The strategic triangle perspective can be used to develop a conceptual framework for strategic CSR.

This study aims to explore the key factors affecting the implementation of strategic CSR. Based on a literature review of the CSR concept and the strategic triangle perspective, this study identifies the main factors and sub-factors affecting the implementation of strategic CSR and establishes a hierarchical network structure for these factors. This study then uses the analytic network process (ANP) method to prioritize the relative weights of each factor and sub-factor in the hierarchical network structure. The results of this study contribute to determining the important factors that influence the implementation of strategic CSR to plan relevant strategies.

Literature review

This study examines the key factors influencing companies’ implementation of strategic CSR. In this section, we first review the general altruistic view of CSR. Second, the essence of corporate strategy was discussed within the framework of the strategic triangle. Then, we explain how to incorporate the strategic triangle perspective into the CSR concept to form strategic CSR. Finally, factors affecting the implementation of strategic CSR were selected to build a hierarchical network structure.

The concept of CSR

With the rise in sustainable development, CSR has become a popular topic. CSR means that enterprises are responsible for promoting social interests while pursuing their benefits (Carroll and Shabana, 2010 ; Josiah and Akpuh, 2022 ). The concept of CSR is a company’s response to social welfare and its responsibility to stakeholders affected by its development (Chang et al., 2014 ). CSR is strongly related to customers, investors, the government, and other stakeholders. Companies with social responsibility balance the needs of the company and stakeholders when making decisions so that they can contribute to society and stakeholders while pursuing profits (Hopkins, 2012 ). CSR mainly focuses on the positive actions of enterprises on social and environmental issues while paying attention to the rights and interests of stakeholders. However, it is difficult to link the ethical behavior of these companies to their own operations (Sheh, 2022 ). The traditional concept of CSR focuses on public interest but ignores the necessity of continuous profitability of companies (Matytsin et al., 2023 ). Companies must learn to integrate CSR actions into their operations rather than viewing CSR as additional philanthropy (Zollo, 2004 ). The current meaning of CSR is that companies must voluntarily incorporate social and environmental issues and interactions with stakeholders into their operations (Commission of the European Communities, 2001 ). Therefore, companies must consider both social responsibilities and operational performance, as well as their complementary strengths.

Strategic perspective and CSR

The purpose of strategy is to efficiently achieve the specific goal of an individual or organization, given the resources and capabilities. Strategic thinking integrates internal and external resources to achieve a competitive advantage in an uncertain and high-risk environment (Khalifa, 2020 ). In other words, the execution of strategy considers not only the current state within the company but also the situation of the external environment to choose the most appropriate way to achieve the goal (Hambrick and Fredrickson, 2005 ). Furthermore, Ohmae ( 1982 ) suggests a strategic triangle perspective and indicates that enterprises should focus on three factors when formulating their strategies, including the company, customer, and competitor. Companies must consider their own conditions and customer needs to provide products or services that are consistently better than those of their competitors and consider the interrelationships among the three factors.

In general, companies play a passive role in CSR implementation (Lindgreen et al., 2009 ). The main reason is that companies lack the motivation to implement CSR. The altruistic behavior of a company does not necessarily bring benefits to the company, and even the implementation of CSR conflicts with corporate profitability (Sprinkle and Maines, 2010 ). In this context, CSR is more of a moral act implemented by a company based on social expectations after making a profit. Even when CSR is linked to business operations, companies do not know how to convert it into business value and competitive advantage. If long-term investment in CSR does not give a company a competitive advantage, CSR will likely be seen as the cost of doing business. Companies tend to lack the motivation to implement CSR, which is not conducive to long-term sustainable development. In fact, companies rarely implement social responsibility purely from an altruistic perspective (Wang et al., 2016 ). The core concept of a company is to pursue performance; therefore, companies should rethink CSR through strategic thinking and select social issues or goals that enable them to fully utilize their core competencies to implement CSR (Porter and Kramer, 2006 ). In this way, companies can turn social responsibility issues into business opportunities, creating more benefits and competitive advantages (Drucker, 1984 ; Padgett and Galan, 2010 ; Manasakis, 2018 ).

Previous studies have mentioned that it is necessary to use a strategic perspective to examine CSR (Porter and Kramer, 2006 ; Wang et al., 2016 ). When thinking strategically, companies usually need to consider how they are positioned against their competitors and how they can use their resources and capabilities to achieve their goals (Porter and Kramer, 2002 ). In other words, companies must assess their internal resources and capabilities, evaluate the stakeholders and competitors involved, and develop appropriate strategies to achieve the desired CSR outcomes (Husted and de Jesus Salazar, 2006 ). Nevertheless, strategic CSR remains a relatively abstract concept requiring further exploration of its specific elements and components.

Therefore, the strategic triangle perspective can be used to establish the structure of strategic CSR and to form a precise concept. From a strategic triangle perspective, companies must take stock of their core competencies and resources, and then consider how to meet the needs of their customers. By integrating this perspective into CSR, strategic CSR can impact customers and stakeholders related to the company. Based on the above discussion, this study explicitly focuses the concept of strategic CSR on three main factors, including company, stakeholder, and competitor. The company factor refers to the resources and assets owned by the company, the stakeholder factor refers to stakeholders who interact with the business, and the competitor factor refers to the competitive advantage over competitors (Husted and Allen, 2007 ). The three main factors that affect the implementation of strategic CSR and the sub-factors within these main factors were discussed below.

From a strategic triangle perspective, the resources within a company can be considered the basis for strategy execution. According to the resource-based theory, valuable resources are the main source of a company’s competitive advantage (Barney, 1991 ). Promoting CSR is not only the responsibility of senior management or specific departments but also the recognition and participation of all employees in the company. Hence, human resources play an important role in CSR implementation (Arnaud and Wasieleski, 2014 ). Adequate professional manpower is a condition for companies to implement CSR (Meyer, 1999 ; Cohen et al., 2010 ). It ensures that sustainability-related strategies and proposals are sufficiently driven to help organizations achieve their goals and ultimately improve their effectiveness (Paillé et al., 2014 ; Voegtlin and Greenwood, 2016 ).

In addition to human resources, companies with sufficient financial resources to support the execution of operational strategies can significantly increase their likelihood of achieving their goals. Similarly, CSR implementation requires sufficient financial capacity (Branco and Rodrigues, 2006 ; Lepoutre and Heene, 2006 ). Moreover, the Fortune 500 spent $19.9 billion on CSR-related activities (Business Backs Education, 2015 ). This not only shows the importance that companies attach to CSR but also reflects that the implementation of CSR requires considerable financial resources.

On the other hand, corporate image is more abstract than other tangible resources because it is an overall performance composed of many factors related to a company (Moon, 2007 ). It is most widely defined as the reputation of a company, the overall impression of the company in the public’s minds (Agyei et al., 2014 ; Huang et al., 2014 ; Li et al., 2022 ). A great corporate image can be built based on a company’s ability, that is, the reputation that a company has built by consistently providing high-quality products or services. Thus, corporate image can also be derived from a company’s contribution to CSR (Vo et al., 2019 ). The image formed by CSR refers to the subjective feelings, attitudes, and evaluation of the public towards the social responsibility implemented by the company (Berens et al., 2005 ; Pérez and Rodríguez del Bosque., 2013 ). By engaging in charitable activities, such as protecting the environment, caring for community issues, and making charitable donations, a company can strengthen its public perception. A company’s image can be used as intangible capital for future public relations strategies to help it gain a competitive advantage.

Accordingly, human resources, financial capacity, and corporate image were adopted as sub-factors within the main factor of company in this study.

Stakeholder

In conventional business operations, a company operates by meeting its customers’ needs, and the results are ultimately reflected in its performance. As the external environment becomes more complex, the actual operation of a company will involve not only customers but also individuals or groups such as investors, media, and governments, all of whom will be affected by the company’s actions or influence its decisions (Freeman, 1984 ). In general, business strategy mainly focuses on the customer aspect, but strategic CSR affects a wider group of people than traditional strategies. According to previous studies, CSR has a significant relationship with corporate performance and stakeholder responsiveness (Alniacik et al., 2011 ; Ansu-Mensah et al., 2021 ). This means that companies can communicate with more stakeholders through CSR implementation (Manasakis, 2018 ). Several stakeholders that may influence CSR implementation, such as consumers, inventors, media, and governments, were discussed below.

First, Bhattacharya and Sen ( 2004 ) suggest that consumers consider a company’s actions towards the environment and society when making purchase decisions and state that CSR actions can increase consumers’ willingness to purchase a company’s products or services. When a company focuses on and contributes to a specific issue, consumers will likely translate their support for the issue into a willingness to buy its products (Thi et al., 2020 ; Zhang, 2022 ). Companies can choose to invest in CSR because consumers will respond to their efforts on social and environmental issues with a higher willingness to buy (Bhattacharya and Sen, 2004 ; Walker et al., 2021 ).

Second, investors must consider various factors when selecting investment targets. The reason why investors are willing to invest their capital in a company depends mainly on its profitability (Lin et al., 2018 ). Companies that contribute to CSR can manage their relationships with employees, suppliers, and other stakeholders, resulting in more stable operational and financial performance (Platonova et al., 2018 ). Moreover, companies that do not integrate environmental and social issues into their business models have a higher chance of being sanctioned by the government or law, including fines and litigation dilemmas, as well as loss of profits due to revelations of corporate misconduct or the outbreak of major industrial and environmental accidents (Brown, 1997 ). A Company that integrates CSR into its business strategy is less susceptible to negative events, convincing investors that it is a better investment target than its competitors.

Third, with the boom in information technology and media, the public has much faster and easier access to information than in the past, and both positive and negative news can be disclosed at the first opportunity (Dhëmbo et al., 2021 ; Fortunato and Pecoraro, 2022 ). The more prestigious a company, the more likely it is to receive media attention and be maliciously attacked by negative media. Companies that are good at preventing reputation risks use the media as a stakeholder to avoid damaging their reputation and improve their ability to respond to external events by voluntarily implementing CSR (Diageo, 2005 ; Unerman, 2008 ). In addition, by evaluating the results of their investments in social and environmental issues, companies can diagnose the potential risks that may arise in their operations and formulate timely improvement plans to avoid reputational damage (GRI, 2002 ).

Finally, the government is an important stakeholder that can force companies to implement CSR (Zueva and Fairbrass, 2021 ). From a strategic perspective, CSR is more than a passive response to regulatory pressure. By proactively engaging in CSR, companies can build bridges and maintain good relationships with the public sector, thereby increasing their influence on public decision-making. CSR increases trust between businesses and the government; helps companies obtain licenses, permissions, and other official documents faster and more smoothly; and avoids redundant bureaucratic costs (Mathis, 2008 ).

Based on these arguments, this study includes purchase intention, investment intention, reputation risk, and government relations as sub-factors within the main factor stakeholder in the hierarchical network structure.

According to the strategic triangle perspective, companies achieve superior financial performance by leveraging their strengths to satisfy their customers while creating a relative advantage over their competitors (Ohmae, 1982 ). In the competitor aspect, the factor that affects a company’s profitability is the price of product relative to the competitor. CSR is an important evaluation criterion for consumers when making purchases. Companies can make consumers perceive that they are concerned about social issues through CSR, which affects consumers’ perceptions of products (Bhattacharya and Sen, 2004 ). Even though not everyone is willing to pay a higher price for the products of companies that implement CSR, for advocates of social and environmental issues, paying a price premium can symbolize their concern and support for a particular issue and serve as a reward for responsible companies (McGoldrick and Freestone, 2008 ). Accordingly, companies can use this feature to set higher product prices (Danko and Nifatova, 2022 ).

Companies that have already established positions in a specific industry must protect themselves from potential competitors and maintain their market share. From a traditional strategic perspective, companies usually adopt cost-cutting strategies to take advantage of price wars to defeat competitors or invest more resources in research and development to build barriers to entry into the industry (Porter, 2008 ). Furthermore, Buccella and Wojna ( 2017 ) suggest that incumbent companies in the industry can regard CSR as a moat against potential competitors and turn it into a weapon to maintain their market position.

On the other hand, a company’s growth is driven by the continuous development of new products or the improvement of existing business models. Innovation ability has become one of the most important strategic considerations in companies’ decisions (Chkir et al., 2021 ). Innovation ability is the driving force behind the implementation of CSR if companies can integrate CSR thinking into their products (Padgett and Galan, 2010 ). Companies that implement CSR are better able than their competitors to use efficient processes for product development and manufacturing (Husted and Allen, 2007 ).

Based on the above points, this study summarizes price premium, entry barrier, and innovation ability as sub-factors within the main factor competitor.

Methodology

The hierarchical network structure.

When applying ANP, the decision problem needs to be clearly structured, and the interrelationships between the factors must be presented in a network manner. The hierarchical network structure can be established mainly through the literature review and the opinions of experts in the field, which contains goal, main factors, and sub-factors (Saaty, 2005 ). This goal indicates that a decision problem must be resolved. The main factors, sub-factors, and interdependencies among factors can be obtained by reviewing the literature and collecting expert opinions on the decision problem (Saaty, 2004 ).

This study aims to identify the factors that may affect the implementation of strategic CSR. Based on the literature review, three main factors and ten sub-factors were obtained to construct the hierarchy. The main factors contain company, stakeholder, and competitor. Company consists of three sub-factors, including financial capacity, human resources, and corporate image. Stakeholder has four sub-factors, including purchase intention, investment intention, reputation risk, and government relations. Competitor has three sub-factors, including entry barrier, price premium, and innovation ability. Then, this study collects expert opinions on the interdependence of factors through questionnaires to form a network structure based on Ngeru et al. ( 2011 ). To ensure that the experts are sufficiently professional and to improve the quality of the data collected, they were selected from among professionals with experience in the field of CSR. A total of twelve experts have an average of 10 years of experience in public relations, consulting, manufacturing, and financial industries, and they are all engaged in CSR-related work in these industries. Twelve questionnaires were distributed and collected, with a 100% return rate. Finally, a hierarchical network structure, including the interrelationships among factors, was established, as shown in Fig. 1 . The operational definitions of the three main factors and ten sub-factors were described in Tables 1 and 2 .

It includes three main factors, ten sub-factors, and the interdependence of factors.

The procedure of ANP

ANP is a scientific approach to decision-making when factors have dependencies and feedbacks, and is an extension of analytic hierarchy process (AHP) (Saaty, 2004 ). One of the assumptions of AHP is that the factors are independent of each other (Stein and Ahmad, 2009 ). However, in reality, many decision problems cannot be structured hierarchically because elements in the hierarchy involve many interactions and interdependencies. Therefore, the structure of ANP usually includes many networks of elements with interdependent relationships, which makes analysis results more realistic (Lee and Lee, 2012 ). The reason for adopting ANP in this study is that it addresses the complexities of implementing strategic CSR and provides best possible outcome for decision-making. The specific steps of ANP were shown as follows (Chung et al., 2005 ).

Step 1: Constructing the pairwise comparison matrix

In this step, a series of pairwise comparisons were conducted to determine the relative importance of factors. Paired comparisons are two-by-two comparisons of factors based on ANP questionnaire, which uses a scale of one to nine as proposed by Saaty ( 2005 ). As shown in Table 3 , a score of 1 means that two factors are equally important to each other, while a score of 9 means that one factor is extremely important compared to the other. And then, the experts in the given field were asked to judge the relative importance between factors in the questionnaire.

The pairwise comparison matrix was obtained by the judgments of experts using ANP questionnaire. If pairwise comparison matrix M is an n  ×  n matrix, then n ( n  − 1)/2 ratings should be calculated. The matrix M was established as below (Saaty, 2004 ).

where b ij is the comparison value of factor i and factor j for one expert, b ij  > 0; b ji  = 1/ b ij ; i, j  = 1, 2,…, n .

Step 2: Calculating priority vector and eigenvalue

The priority vector (also called eigenvector) and eigenvalue of each pairwise comparison matrix in ANP can be derived as in AHP by solving the following formula (Saaty, 2005 ).

where M represents a pairwise comparison matrix, w is the priority vector (eigenvector), and λ max is the largest eigenvalue of M . The priority vector w and the eigenvalue λ max can be computed by the following sub-steps (Al-Harbi, 2001 ).

Step 2-1: Dividing each comparison value of matrix M by the sum of its column to produce the normalized pairwise comparison matrix.

Step 2-2: The priority vector w can be calculated by dividing the sum of each row in the normalized pairwise comparison matrix by the number of factors in the matrix.

Step 2-3: Firstly, multiplying matrix M by priority vector w to generate the vector Mw . And then, divide the values of the vector Mw by their respective values of priority vector. Finally, the eigenvalue λ max can be calculated by averaging the values generated above.

Step 3: Consistency test

The consistency test must be implemented to ensure that there are no logical fallacies in the judgments. The consistency index (CI) and consistency ratio (CR) can be utilized to check the consistency of each matrix. The CI was formulated as follows (Saaty, 2005 ).

where n is the number of factors.

And then, the CR of each matrix can be computed as below (Saaty, 2005 ).

where the random index RI represents the random consistency of various size of matrices. The values of RI were shown as Table 4 . If CR is less than a threshold value, then the matrix has acceptable consistency. The thresholds value proposed by Saaty ( 2005 ) is 0.1.

Step 4: Building the supermatrix

To address the dependencies between factors in the research framework, ANP uses supermatrix to calculate the relative weights of factors. A supermatrix consists of a combination of sub-matrices, each of which contains dependencies of elements within each cluster and is compared cross-cluster with elements from other clusters. If there is no correlation between the elements, the pairwise comparisons in the sub-matrices are equal to zero (Saaty, 2005 ). In this study, the main factors represent clusters and the sub-factors represent elements.

As shown in Eq. ( 5 ), W ij is the eigenvectors generated by comparing the element in cluster i with the element in cluster j . If the cluster j has no effect on the cluster i , the value is equal to zero. The structure of supermatrix is generated based on this logic (Saaty, 2004 ).

The standard form for a supermatrix was shown in Eq. ( 6 ) (Saaty, 2004 ). In general, each column of this matrix is not normalized or equal to one, which makes this matrix an unweighted supermatrix.

where C h is the cluster of a decision system; h  = 1, 2,…, n , and each cluster h has m h elements, denoted by e h 1 , e h 2 ,…, e hmh .

The supermatrix needs to be column-stochastic in order for convergence to occur. To achieve this, the weighted supermatrix W’ was established after the normalization (Saaty, 2004 ). Furthermore, it is necessary to raise the weighted supermatrix to exponential powers in order to reach stabilization or convergence. The resulting matrix is called limit supermatrix W limit , as shown in Eq. ( 7 ) (Saaty, 2005 ). The form of limit supermatrix is the same as the weighted supermatrix, but each column of the limit supermatrix is the same. Finally, the global weight of each factor can be obtained in the limit supermatrix.

where k is an arbitrarily large number.

This study examines the important factors for companies to implement strategic CSR. As companies consider many aspects in practice, and each factor may be related, ANP was used to obtain the relative weight of each factor. The weights of factors in the hierarchical network structure were generated according to the steps proposed in the methodology section.

In step 1, a series of pairwise comparisons were conducted to construct pairwise comparison matrices. Paired comparisons are two-by-two comparisons of factors based on ANP questionnaire using the scale of 1 to 9 shown in Table 3 . The experts were asked to make three levels of pairwise comparisons in the questionnaire, including the comparisons between main factors, comparisons between sub-factors within each main factor, and comparisons of dependencies for main factors or sub-factors. A total of fifteen experts working in the field of CSR were selected to fill out the questionnaire. These experts have an average of 12 years of CSR-related experience, with ten from industry and five from academia, as shown in Table 5 . After collecting fifteen questionnaires, the data were imported into Excel to form the pairwise comparison matrix of each expert. Next, the pairwise comparison matrices of fifteen experts were integrated into the aggregated pairwise comparison matrices using the geometric mean method, and then imported into Super Decisions V3.2 software for subsequent analysis. Table 6 presents the aggregated pairwise comparison matrix of main factors. Table 7 , Table 8 , and Table 9 describe the aggregated pairwise comparison matrices of sub-factors within each main factor, respectively.

In step 2, the priority vector and eigenvalue λ max of each pairwise comparison matrix was computed by Eq. ( 2 ) using Super Decisions V3.2 software. And then, CR value of each matrix was calculated by Eqs. ( 3 ) and ( 4 ) in step 3. The priority vector and CR value for each matrix was also shown in Table 6 , Table 7 , Table 8 , and Table 9 . Since all CR values are less than 0.1, the consistency of each matrix is acceptable (Saaty, 2005 ). Finally, the limit supermatrix was generated based on Eqs. (6) and ( 7 ) in step 4 and shown in Table 10 . Considering the dependencies among factors and sub-factors, the global weights of sub-factors were computed using Super Decisions V3.2 software.

Table 6 shows the relative importance of three main factors without considering dependencies. “Company” has the highest weight (0.4992), “stakeholder” has a weight of 0.3310, and “competitor” has a weight of 0.1698. Tables 7 to 9 present the relative importance of sub-factors within the main factors of company, stakeholder, and competitor, respectively, regardless of the dependencies. In the “company”, the sub-factor “financial capacity” possesses the highest weight (0.4650). Within the main factor “stakeholder”, “purchase intention” is the most important sub-factor (0.4125). In the main factor “competitor”, the most critical sub-factor is “innovation ability” (0.4783).

The global weights of sub-factors were listed in Table 11 . “Corporate image” has the highest weight (0.1779), followed by “innovation ability” at 0.1653, while “reputation risk”, “financial capacity”, and “investment intention” also have higher weights at 0.1282, 0.1264, and 0.1237, respectively. These five sub-factors are key elements that companies need to consider when implementing strategic CSR. In addition, the three sub-factors at the “company” level account for 0.4028 (0.1264 + 0.0985 + 0.1779) of the global weights. The weights of sub-factors in the “stakeholder” adds up to 0.3766 (0.0944 + 0.1237 + 0.1282 + 0.0303). It can be seen that main factors “company” and “stakeholder” account for nearly 80% of the weight, and these two factors have a significant impact on the implementation of strategic CSR.

This study aims to identify the key factors affecting the implementation of strategic CSR. First, the main factors and sub-factors affecting the implementation of strategic CSR were selected based on a literature review. Subsequently, a hierarchical network structure was constructed for these factors. The ANP method was then utilized to prioritize the relative weights of each main factor and sub-factor in the hierarchical network structure. Based on the results of analysis, this section discusses three aspects of company, stakeholder, and competitor.

“Company” has the highest weight among all main factors in this study. In this main factor, “corporate image” and “financial capacity” are among the top five sub-factors with the highest weights. Primary, “corporate image” has the highest weight among all sub-factors. This finding confirms previous research that corporate image is an important factor related to CSR (Arendt and Brettel, 2010 ; Vo et al., 2019 ). The public’s overall opinion of a company is key to its sustainable operation, and intangible assets such as corporate image can provide the basis for strategic planning. Therefore, building a corporate image is an inevitable incentive for operators when planning CSR strategies.

Furthermore, “financial capacity” is ranked fourth in weighting among all sub-factors. This highlights that the financial resources available to companies impact the implementation of strategic CSR. The result is consistent with previous studies that have made similar arguments about CSR, company size, and financial situation (Branco and Rodrigues, 2006 ; Choi et al., 2018 ). Large enterprises typically have more resources, stable financials, and mature business models than start-ups; therefore, they do not need to worry about the impact of implementing CSR on their financial performance, and their solid foundation increases the likelihood that they will invest in CSR (McGuire et al., 1988 ; Brammer and Millington, 2006 ). Companies should reserve appropriate budgets for CSR strategies in advance according to their financial situation and formulate corresponding CSR strategies based on the available resources.

External groups are one of the factors that influence companies when planning CSR strategies. In this study, “stakeholder” is given secondary weight in all main factors. Among all sub-factors, “reputation risk” within the main factor “stakeholders” has the third highest weight, indicating that companies view CSR as a way of risk management. Avoiding reputational damage is one of the main motivations for enterprises to implement CSR (Branco and Rodrigues, 2006 ; Choi et al., 2018 ). The reason is that if a company’s long-established reputation is destroyed by media coverage, it will cause a great loss to the company. The best way to deal with this risk is to review and improve the company’s negligence in business processes through CSR so that the media cannot criticize the company’s reputation.

“Investment intention” has the fifth highest weighting of all sub-factors. This indicates that when a company pursues its CSR outcome, it is expected to be seen by investors as a company with greater growth potential and ultimately creates higher value for shareholders. This feature allows companies to obtain more capital from investors to support their operational activities and strategic planning (Malik, 2015 ). In fact, CSR investment has already made its mark on the financial market. Investors prefer to invest in responsible companies (Brown, 1997 ; Msiska et al., 2021 ).

Corporate strategy aims to gain a competitive advantage. The second highest weight is given to “innovation ability” among all sub-factors. The result supports the idea that a company’s ability to innovate helps implement CSR strategies and develop more business opportunities by considering the connection to environmental and social issues (Husted and Allen, 2007 ; Padgett and Galan, 2010 ). There is already a precedent for companies combining corporate innovation with social responsibility. Toyota launched a range of innovative vehicles with hybrid fuel and electric engines to address growing environmental concerns and vehicle emissions through product innovation (Iyer and Soberman, 2016 ).

Conclusions

This study integrates the strategic triangle perspective with the concept of CSR to generate strategic CSR and identify the key factors that affect the implementation of strategic CSR. The strategic CSR proposed in this study emphasizes that companies should take the initiative to integrate social responsibility with their own goals and core business while considering internal resources, stakeholders, and the competitive environment to formulate the most appropriate strategic plan. This enables companies to achieve their strategic goals while fulfilling CSR.

This study has several important managerial implications. First, by integrating strategic thinking into CSR, the scope of social responsibility is not only to fulfill the civic duties of enterprises to benefit society but also to maintain relationships with stakeholders and gain competitive advantages. Second, the hierarchical network structure proposed in this study can help CSR practitioners think about strategic CSR from a holistic perspective so that the concept of CSR can be better integrated into business strategies and become an issue to be considered when companies conduct strategic planning.

Third, the findings of this study will enable CSR practitioners to understand the relatively important factors that influence the implementation of strategic CSR and to invest resources and effort in areas related to these key factors. This enables strategic CSR to be implemented more efficiently and ultimately has the greatest impact. Finally, these results help companies comprehend how the implementation of CSR relates to their own goals and performance, and the benefits it can bring them. In this way, CSR will no longer be seen as a cost or expense but as a strategy that can help companies achieve their goals. From this perspective, companies will be more motivated than ever to fulfill their CSR, leading to better social and economic development.

Concerning its methodological contributions, the ANP method has some advantages. Primarily, ANP is an appropriate technique for solving multi-criteria decision-making problems in which there are dependencies among factors. This can simplify complex problems and effectively identify the key factors that affect the implementation of strategic CSR. Next, by applying the ANP method, which combines both qualitative and quantitative information, a precise hierarchical network structure was proposed to systematically examine these factors. Finally, because ANP uses pairwise comparisons derived from the judgments of experts, accurate weights of the main factors and sub-factors can be generated based on professional considerations.

Nevertheless, this study has some limitations that should be examined in future research. Primarily, the main factors and sub-factors were selected from the literature review, which may have confined the range of factors that could be selected. Future research could combine a literature review with other methods, such as focus group, nominal group technique, and in-depth interviews, to identify additional factors. Furthermore, this study uses ANP as a single method to establish a hierarchical network structure for determining the key factors influencing strategic CSR implementation. Future research could further consider the ambiguity associated with the judgments of experts and incorporate fuzzy numbers into the ANP method to evaluate the relative weights of factors.

Data availability

The datasets generated during and/or analyzed during the current study are available from the corresponding author on reasonable request.

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Wu, CC., Cheng, FC. & Sheh, DY. Exploring the factors affecting the implementation of corporate social responsibility from a strategic perspective. Humanit Soc Sci Commun 10 , 179 (2023). https://doi.org/10.1057/s41599-023-01664-4

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ORIGINAL RESEARCH article

The impact of corporate social responsibility on sustainable innovation: a case in china’s heavy pollution industry.

• 1 School of Economics and Management, University of Science and Technology Beijing, Beijing, China
• 2 The Institute of Low Carbon Operations Strategy for Beijing Enterprises, Beijing, China

Exploring the impact of corporate social responsibility (CSR) fulfillment and disclosure on enterprises’ sustainable innovation capacity can not only expand the research boundary of factors of sustainable innovation and the impact of CSR, but it can also serve as a reference for the decision-making of listed companies in increasing pollution problems. Using a sample of 224 Chinese A-share businesses in the heavy pollution industry listed between 2016 and 2020 and employing an ordinary least square regression, the results provide empirical evidence that CSR is positively associated with sustainable innovation. Second, the business environment can serve as a moderator of the relationship between CSR and sustainable innovation, and the positive relationship between CSR and sustainable innovation is more pronounced in regions with better macroeconomic conditions. Additionally, the improvement of CSR for sustainable innovation is more clear in state-owned firms than in non-state-owned enterprises. After a series of robustness tests that eliminate marketization, law enforcement, and macro-political unpredictability, the results still hold. This study broadens the scope of CSR and sustainable innovation research. In addition, the theoretical and practical significance of this study’s findings is referenced in this paper.

Introduction

Environmental and climate concerns caused by the intensification of global industrialization are irreversible. Corporate social responsibility (CSR) is a successful approach that encourages businesses to take on additional duties to support social and sustainable development, given the growing consensus in modern global business on the value of sustainable development ( Bauman and Skitka, 2012 ). Innovation is one of the primary drivers of boosting sustainability development ( Silvestre and Neto, 2014 ) and positively impact green performance ( Sharma et al., 2021 ). Scholars pay close attention to the expanding literature on CSR and sustainable innovation ( Shakeel et al., 2020 ).

Economy ( Al-Hadi et al., 2019 ), legislation ( Lau et al., 2018 ), morality ( Mikulka et al., 2020 ), society, and the environment should be firms’ primary responsibilities ( Amor-Esteban et al., 2019 ). It highlights that CSR is not only to fully consider stakeholders and execute the comprehensive social contract but also to increase economic performance ( Cho et al., 2019 ) while assuming environmental obligations. In recent years, there have been many forms of studies on CSR’s influence and influence elements. National culture and corporate governance ( Garcia-Sanchez et al., 2016 ; Mohamed Adnan et al., 2018 ), social media ( Grygiel and Brown, 2019 ), ethics ( Galvão et al., 2019 ; Smith et al., 2021 ), corporate reputation, and customer satisfaction ( Li et al., 2019 ; Yu and Liang, 2020 ; Bogdan et al., 2021 ), corporate integrity culture ( Wan et al., 2020 ; Khan et al., 2022 ). Sustainability strategy, performance, stakeholders, developing nations, climate change, and supply chain management are the research keywords for CSR ( Ye et al., 2020 ). An innovative and sustainable organization respects the environment’s capacity to support and protect its ecosystem’s resources while pursuing economic efficiency ( Severo et al., 2017 ). The research model incorporated CSR as the direction of future development, and sustainable innovation aimed at the environment can boost the economic and environmental performance of businesses ( Ahmad et al., 2021 ).

As a fundamental aspect of sustainable development, the importance of sustainable innovation is self-evident ( Silvestre and Ţîrcă, 2019 ). Prior research shows the connection between people, businesses, and creativity. Environmental sustainability has actively supported the innovation of sustainable business practices ( Shahzad et al., 2020 ). Higher enterprise innovation success is associated with greater CSR ( Wu et al., 2018 ). In recent years, however, there have been few studies on the relationship between sustainable innovation and CSR. Based on social capital and stakeholder theories, CSR impacts innovation performance in an inverted U-shape. The direction of CSR’s influence on innovation may vary among industries ( Liu et al., 2021 ). The association between sustainable innovation and CSR, therefore, requires additional study. Additionally, from an industry perspective, businesses in different industries require different fundamental resources for innovation; therefore, CSR data must be distinguished according to the industry in the study. Existing literature focuses mostly on the fashion sector ( Arrigo, 2013 ), the semiconductor business ( Lu et al., 2013 ), the banking industry ( Istianingsih et al., 2020 ), and the energy industry ( Arrigo, 2013 ; Lu et al., 2013 , 2019 ; Istianingsih et al., 2020 ).

It is common knowledge that significantly polluting companies have a far greater detrimental influence on the ecological environment than others do ( Xie et al., 2022 ). Because of China’s large consumption of traditional fossil fuels, the country’s environmental quality has worsened significantly, attracting the international community’s utmost concern ( Dong et al., 2021 ). China is the largest manufacturing nation in the world. According to the China Statistical Yearbook 2021, 68% of total energy consumption is attributable to enterprises with elevated levels of pollution. To advance the aims of “carbon peak” and “carbon neutral,” more studies must be undertaken on industries with elevated levels of pollution. Since the reform and opening of China 40 years ago, China’s industry has boomed. The prior development, however, was overly reliant on energy and resource input and production scale expansion. China’s industrial expansion followed a broad pattern of growth, inflicting serious environmental and ecosystem harm ( Zhang J. et al., 2017 ). Traditional industries with high energy consumption, high emissions, and high pollutants will have a considerable influence on the environment. Innovation is one of the driving forces for China’s sustainable industrial development ( Yuan and Zhang, 2020 ). In recent years, China’s environmental rules and regulations have been increasingly stringent, and the sustainable development of China’s heavy pollution sectors has steadily become dependent on green development that considers innovation and environmental considerations. However, Fang et al. (2019) discovered in their research that heavy pollution sectors face the conundrum of “effective but not environmentally friendly innovation.” Consequently, it is vital to investigate further the performance of China’s heavy polluting sectors in terms of sustainable development.

This article picks Chinese A-share listed firms from 2016 to 2020 as its research object and empirically examines the impact of CSR on enterprises’ sustainable innovation capacity. The findings show that the output of green innovation considerably enhances business sustainability. Given the sustainable development of businesses, the following questions are posed in this study. How can CSR foster innovation and sustainability? Does the influence of CSR on the capacity for sustainable innovation vary by corporate environment? What is the state of CSR in the Chinese heavy polluting industry?

The following are the primary contributions of this work. First, it expands the literature on sustainable innovation and CSR, which contributes to the development of a fresh perspective for the study of the factors influencing the sustainable innovation capacity of businesses. Existing studies have investigated more CSR-influencing aspects, however, there remains a dearth of studies on CSR’s role. As opposed to undertaking a standard analysis at the firm or national level, this study focuses on publicly traded enterprises in China’s heavy pollution industry. This study can therefore serve as a substantial contribution to the research on the sustainable development of the heavy pollution sector and give theoretical support for the heavy pollution industry to realize its low-carbon transformation goals. Third, most previous research has ignored the societal dimensions of CSR in general ( Chen and Wan, 2020 ). In this study, the business environment is included as a moderating variable in the research model to investigate the impact of macroeconomic conditions on the relationship between sustainable innovation and CSR. The data passed the test for robustness. Thus, our findings may be useful to policymakers by identifying social normative force and illuminating how it drives businesses. Given that CSR has a significant impact on the interests of stakeholders, this study can also assist stakeholders in making more informed judgments about the sustainable innovation of businesses.

The organization of this investigation is as follows: The literature review and research hypotheses are provided in Section “Literature Reviews and Research Hypotheses”. The third section of this study describes the research design, including the variables, sample, and model selection. The section “Robustness Tests” consists of empirical analysis, findings reporting, and comments. Section “Conclusions and Policy Recommendations” highlights the theoretical and practical implications’ conclusions and policy recommendations.

Literature Reviews and Research Hypotheses

Sustainable innovation and csr.

According to the stakeholder theory, (CSR) entails that the development of businesses should include stakeholders, including employees, consumers, suppliers, and communities ( Turker, 2009 ). By adhering to principles of CSR, businesses can foster confidence and excellent connections with internal and external stakeholders and effectively drive innovation ( Lins et al., 2016 ).

Everything related to CSR can have a favorable effect on shareholder profitability ( Pucheta-Martínez and Gallego-Álvarez, 2021 ). CSR provides shareholders with economic profits, management and operational knowledge, and motivation to work on CSR. Shareholder-related CSR can increase shareholder confidence in innovative investment opportunities ( Iyer and Soberman, 2016 ). Employee-focused CSR can facilitate employee identification with the organization. When employees acknowledge a firm’s commitment to environmental sustainability, they encourage the organization to regard environmental preservation as a competitive advantage-enhancing opportunity ( Ernst and Jensen Schleiter, 2021 ). Enterprises boost social and environmental performance through pro-environment behavior and stimulate employees’ green behaviors, which has a favorable effect on employees’ innovative technology exploration ( Xu et al., 2022 ). Green human resource management may promote the sustainability of enterprises as an essential technique for influencing the green behavior of employees ( Amjad et al., 2021 ; Zhu et al., 2021 ). Employee green creativity is regarded as the driving force behind company green innovation, and employee green behavior is a crucial metric for measuring employee green creativity ( Jiang et al., 2020 ). Gaudencio et al. (2017) found that CSR increases employee job satisfaction and organizational commitment and has a beneficial effect on the establishment of a stable innovation team ( Ho, 2017 ). CSR receives greater attention the more optimistic the customer’s attitude. Customers like to buy products that perform well in terms of social responsibility ( Iyer and Soberman, 2016 ). Because of client desires, businesses produce added items through technological innovation. In addition, CSR can influence the behavior and selection of suppliers ( Kumar et al., 2014 ; Zhang M. et al., 2017 ; Govindan et al., 2018 ). Companies in a supply chain that apply CSR-related practices can enhance not just their performance, but also that of their supply chain partners ( Yang et al., 2020 ). Businesses may develop societal trust and a positive public image by engaging in CSR. Because of these factors, businesses can foster economic performance and innovative conduct.

Many researchers have conducted studies on sustainable innovation. Sustainable innovation is described as an innovation model with sustainable innovation goals in the creative development process ( Cagliano and Behnam, 2019 ). It exemplifies innovation that is advantageous for environmental quality improvement and social collaboration ( Zhang et al., 2022 ). The enterprises’ green innovation behavior can be considered the performance of sustainable innovation. Important to sustainable development, green innovation promotes innovative technology and concepts ( Liao et al., 2022 ). In addition to ensuring efficient resource usage and effective pollution reduction, the competitive advantage of green innovation rests in achieving optimal economic performance ( Fernando et al., 2019 ). Studies have shown that CSR can assist stakeholders in increasing their profitability and further promote green investment and pro-environment behavior, which is reflected in sustainable innovation’s success. Consequently, we suggest our initial hypothesis:

H1 : The output of CSR can significantly enhance the corporate sustainable innovation performance.

The Moderating Role of the Business Environment

Environment and resources limit the development and operation of heavy pollution industries, which are specialized sectors. In other words, high pollution businesses operate in an environment that is dynamic and constantly changing. Instead of operating in a vacuum, organizations are formed by their surroundings ( Harrison and Pelletier, 1998 ). The environment of an organization is its means of survival. Considered one of the aspects determining the sustainable performance of a corporation is the business environment ( Alqudah et al., 2021 ). The optimization of the business environment can foster technological innovation and enhance the product quality and technological level of businesses. In addition, the optimization of the market environment facilitates firm entry and enhances market rivalry, hence interesting incumbent enterprises to do technological research and development. The development of environmental technologies can foster sustainable innovation in industries with high pollution levels.

Based on the preceding study, the following is the second hypothesis:

H2 : The promotion effect of the output of CSR on sustainable innovation performance is more significant when the business environment is poor.

Materials and Methods

Sample selection and data sources.

This study focuses on the Chinese A-share firms involved in severe pollution industries from 2016 to 2020. Two thousand sixteen is the most recent year for which we have comprehensive data. Given that some data are unavailable at the time of this study, 2020 has been chosen as the conclusion date. The scope of sample selection refers to the CSMAR database and the classification standards of heavily polluting industries in The Guidelines for Environmental Information Disclosure of Listed Companies by the Chinese Ministry of Environmental Protection. To assure the validity of the empirical research, the sample is treated as follows. First, to avoid the influence of outliers, firms with anomalous financial status, ST, * ST, suspended listing, and delisting between 2016 and 2020 were omitted from this study. Second, we eliminate samples devoid of CSR and other variable values. Third, to prevent the influence of extreme values, we eliminate the samples from 2016-to 2020 for which the value of sustainable innovation is zero. The CSR statistics are from the social responsibility reports of HeXun Net-listed enterprises. The data on sustainable innovation comes from the National Intellectual Property Patent Database and the Green List of International Patent Classification maintained by the World Intellectual Property Organization (WIPO). Other data sources include the China Statistical Yearbook, the China Environmental Statistical Yearbook, the annual reports of publicly traded enterprises, and the RESSET database.

Dependent Variable (Sustainable Innovation)

According to the current body of research, there are no accepted criteria for measuring the sustainable innovation of businesses. The patent data of an enterprise directly reflects its technological innovation accomplishments, and the number of patents can be used to gauge an enterprise’s innovation level ( Abraham and Moitra, 2001 ; Albino et al., 2014 ). This study selects patent applications for green inventions and green utility models as indicators of sustainable innovation.

Independent Variable (CSR)

The social responsibility assessment system of HeXun Net comprises fifty subdivision indicators. The entire system is based on shareholder responsibility, employee accountability, supplier, customer, consumer responsibility, environmental responsibility, and social responsibility. The findings represent CSR compliance and transparency.

Moderating Variable (Business Environment)

The business environment is selected as the moderating variable in this study. The concept of conducting business is derived from the World Bank’s Doing Business Report. The World Bank evaluates the business climate from a national and regional standpoint. This study requires more granular indicators for provincial regions. Consequently, this article utilizes the research on the evaluation index system of the business environment ( Yang and Wei, 2021 ) to objectively calculate the business environment index of the city where the firms are located. This index system comprises per capita GDP, average salary level, consumption rate, per capita fixed asset investment, and GDP growth rate as indicators and takes into consideration disparities in economic development level and human capital from the standpoint of the macroeconomic environment.

Control Variables

Drawing on the previous empirical research on CSR ( Ali and Frynas, 2017 ; Su, 2019 ; Chen and Wan, 2020 ; Wan et al., 2020 ), this study also selects control variables as follows: the size of the company (SIZE), price-to-book ratio (PB), profitability (LEV), return on total assets (ROA), years of establishment (AGE), cash flow (CASH), shareholding nature (SOE), managerial shareholding ratio (MSH), board independence (INDEP), and duality (DUAL).

The definitions and interpretations of all variables are shown in Table 1 .

Table 1 . Variable definitions.

Empirical Models

Based on the previous studies ( Chen and Wan, 2020 ; Chen and Ji, 2022 ; Liao et al., 2022 ; Xie et al., 2022 ), this study establishes Equation 1 and use the OLS regression method to investigate the impact of CSR on the sustainable innovation.

Results and Discussions

Descriptive statistics.

The variables’ descriptive statistics for the entire sample are presented in Table 2 . As shown in the table, the mean and median values are 1.887 and 1.0986, respectively, whereas the 25% levels and maximum CSR are 0.0000 and 8.9200, showing that there are considerable disparities in SI performance among the studied organizations. The mean and median CSR values are 24.7164 and 19.8650, respectively, while the minimum, 25%, 75%, and maximum CSR values are −11.7700, 15.3025, 26.4050, and 85.7700, indicating that the sampled organizations perform poorly on CSR. Both the capacity for sustainable innovation and performing CSR among the samples have a significant space for development. The 25% and 75% thresholds of ENVIR are 0.3833 and 0.5445, respectively, showing that the macroeconomic contexts in which the studied enterprises operate are distinct. The minimum and maximum CASH values are −7.7700 and 17.5900, respectively, indicating that there are significant variances in operational capability among the examined organizations. The mean for independent SOEs is 0.4375, meaning that 43.75% of the studied enterprises are government-owned. Moreover, there are significant variances in many sample parameters, such as SIZE, PB, LEV, ROA, and MSH, necessitating the inclusion of these control variables in this model. Table 2 additionally provides descriptive analysis results for other variables.

Table 2 . Descriptive statistics.

Correlation Analysis

The Pearson correlation coefficients between the variables are displayed in Table 3 . Consistent with hypothesis H1, the correlation study demonstrates that SI is significantly consistent with CSR at the 1% level, providing early evidence that corporate integrity culture is favorably associated with a firm’s CSR performance.

Table 3 . Correlation analysis of variables.

In general, if the correlation coefficients between independent variables are less than or equal to 0.80, the model may not have significant multicollinearity issues. All correlation coefficients between independent variables in this model are less than 0.454. There is hence no multicollinearity issue. The findings of the univariate correlation analysis are shown above, and the results of the multivariate regression analysis will be presented below.

Multivariate Regression Results

Table 4 displays the findings of a multivariate regression on the effect of CSR e on sustainable innovation. Although the modified R2 (0.147) is insufficient, the F -value shows that the models as a whole are significant (18.506). Model (1)'s regression output comprises independent variables and control variables. CSR has a significantly positive impact on sustainable innovation (0.016, t  = 7.018), as shown in the table. This positive correlation implies that hypothesis H1 proposed in this paper’s research hypothesis section has been confirmed by the empirical study. The findings suggest that organizations that prioritize CSR fulfillment and disclosure have a greater capability for sustainable innovation. Since the existing research has identified the influencing factors of CSR, we choose several representative corporate management variables as control variables, and the regression results of the control variables in Model (1) are most consistent with expectations. Among the control variables, the SIZE, AGE, CASH, SOE, and INDEP regression coefficients are significantly positive. A greater number of independent directors, a larger asset size, a longer listing period, more asset liquidity, and more stable equity are all correlated with a higher ability for sustainable innovation. Significantly negative regression coefficients for PB can be observed. The lower the price-to-book ratio, the greater the company’s investment value and growth prospects, and hence its emphasis on sustainable innovation. Several research has previously investigated and proven the inherent positive impact of CSR, innovation, and sustainable development ( Silvestre and Ţîrcă, 2019 ; Sharma et al., 2021 ; Chen and Ji, 2022 ; Liao et al., 2022 ). This study’s findings are consistent with past research in this area. In addition, the data confirm the likelihood that CSR in various industries may have varied effects on sustainable innovation at various times ( Liu et al., 2021 ). This may owe to the various key resources utilized by various sectors. In the context of China’s carbon peak and carbon neutrality objectives, firms in the heavy pollution industry that place a premium on CSR will prioritize their sustainable development and guide stakeholders to engage in sustainable innovation.

Table 4 . Regression results of sustainable innovation and CSR.

The H2 hypothesis investigates the effect of the business environment on the relationship between sustainable innovation and CSR. Before assessing the business environment moderating, we standardize the data. Table 4 displays the regression findings for Model (2). We derived varying business climate scores based on the location of the businesses. The business environment has a considerable impact on the interaction between sustainable innovation and CSR. The enhanced R2 of 0.203 indicates that the model has a better fitting effect. This positive correlation demonstrates that the empirical investigation has confirmed the hypothesis H2 proposed in the research hypothesis section of this work. Objectively, the business environment plays a moderating role. On the one hand, when businesses perform well in terms of CSR, a better macroeconomic climate can bring about greater investment possibilities and human capital to encourage the development of sustainable innovation capability. In contrast, when a business is in a location with a more favorable economic climate, market rivalry and government laws will encourage the business to adhere to CSR and prioritize sustainable development. When businesses are in regions with more favorable economic conditions, they are more likely to have easier access to capital, hence bolstering budgets for sustainable innovation. Consequently, the ability for sustainable innovation may increase. In addition, the coefficients and significance of other control variables in this model are consistent with expectations.

Robustness Tests

Controlling the effects of marketization and law enforcement.

In addition, we control for the effects of marketization and law enforcement, both of which may impact the CSR of local firms. For instance, Du et al. (2016) observed that the amount of law enforcement in an area has a considerable impact on the CSR performance of local businesses and that the enforcement of regulations varies greatly throughout Chinese provinces. Based on a prior study ( Wang et al., 2008 ; Chen and Wan, 2020 ), one should additionally evaluate a region’s marketization. We use the regional marketization index and the legal environment index in conjunction with prior research ( Wan et al., 2020 ) to assess the marketization process and regional law enforcement in China ( Fan et al., 2011 ). Table 5 displays the outcomes. We add the control variable MARKET to the regression model in column (1). In column (2), the control variable LAW is incorporated into the regression model. In column (3), both MARKET and LAW are included as control variables in the regression model. The results of the three models are comparable, showing that the influence of CSR on sustainable innovation remains positively significant. Therefore, the localization of the market for law enforcement has no bearing on our argument regarding the relationship between CSR and sustainable innovation. The empirical findings remain valid.

Table 5 . Controlling for the effects of marketization and law enforcement.

Exclusion of Alternative Explanations

Chen and Ji (2022) discovered that research results may only be confirmed during a period with a negative macro-political environment and fade during other eras. Therefore, it is essential to rule out this other explanation and re-evaluate our samples. In 2017, for instance, the 19th National Congress of the Chinese Communist Party was held. In addition, COVID-19 affected most of China in 2020. Both can be unpredictable macro-political environment elements. As a result, we choose the policy environment index ( Yang and Wei, 2021 ) as a proxy to measure the macro-political environment of a region. To facilitate comparisons, we divide our sample into two groups based on whether macro-political environment uncertainty is high or low and recalculate the regression results. The value of the policy environment index that is below the mean shows macro-political environment uncertainty, whereas a value above the mean indicates political environment uncertainty. The results presented in Table 6 for samples of high and low political uncertainty are consistent with those presented in prior tables. The macro-political environment does not affect our outcomes.

Table 6 . Exclusion for political uncertainty.

Conclusion and Policy Recommendations

In recent years, China has established the goals of carbon peak and carbon neutrality, as well as intensified its efforts to change heavy polluting industries to promote energy saving, emission reduction, and sustainable growth. This research investigates the relationship between sustainable innovation and the CSR of China’s big polluters that are publicly traded. Exploring the impact of CSR on the sustainable innovation capacity of enterprises can not only broaden the scope of research on the impact mechanism of sustainable enterprises’ development capacity and the effect consequences of CSR but also serve as a guide for the decision-making of publicly traded companies in the heavy pollution industry. Based on the data of China’s A-share heavy pollution listed companies from 2016 to 2020, we evaluated the effect of CSR fulfillment and disclosure on green patent applications. Through a series of robustness tests, the results are unaffected by marketization, law enforcement, and macro-political unpredictability.

The outcomes reveal: (1) CSR significantly improves the sustainable innovation capacity of businesses and (2) when a business is in a region with a more favorable macroeconomic environment, the effect of CSR on sustainable innovation capacity is more pronounced. Additionally, the improvement of CSR for sustainable innovation is more clear in state-owned firms than in non-state-owned enterprises. CSR has a more favorable effect on sustainable innovation when the board is more independent. These results also indicate that the government and independent directors can serve as a check, a balance, and a supervisor to encourage stakeholders to prioritize CSR and promote sustainable innovation capacity from the sidelines, particularly in China’s heavy pollution industry.

Policy Recommendations

This study’s findings have the following implications for businesses, their managers, and legislators. In the first place, our empirical findings demonstrate that CSR greatly improves sustainable innovation potential. Therefore, corporate managers must acknowledge the significance of CSR. They should place a greater emphasis on the outcomes of sustainable innovation and realize the sustainable development of businesses through sustainable innovation. Due to the stimulation of macroeconomic environmental conditions, firms in the heavy polluting industry will pay greater attention to the fulfillment and disclosure of CSR and support the strengthening of their capacity for sustainable innovation. Currently, heavy polluting industries, particularly manufacturing, are shifting from China’s economically developed eastern areas to the economically depressed center and western regions. If the government does not prioritize local economic growth, it may negatively affect the local ecology. Moreover, by addressing internal governance characteristics, businesses can mitigate the detrimental impact of the regional transfer on sustainable innovation. Thirdly, green human resource management methods can improve the environmental performance and sustainability of businesses ( Roscoe et al., 2019 ; Bazrkar and Moshiripour, 2021 ). Incorporating sustainability measures into the human resource management system ( Sabokro et al., 2021 ) and recognizing the role of human resource management for the achievement of long-term sustainability in industrial development are therefore options for heavy pollution industries. In conclusion, businesses should integrate green and sustainable practices into their overall development plan.

Limitations and Future Research Directions

This study has limitations that necessitate more investigation. Due to the availability of data, this report only includes information from 2016 to 2020. Due to China’s ongoing efforts in energy saving and emission reduction during the past few years, results may vary over time. In addition, this article examined the impact of CSR on sustainable innovation from the standpoint of CSR. In future, we can also examine the effects of the many components of CSR. Lastly, the proportion of highly educated employees and research and development professionals might be viewed as elements that influence the sustainable innovation capacity of businesses.

Data Availability Statement

The raw data supporting the conclusions of this article will be made available by the authors, without undue reservation.

Author Contributions

XL: investigation, data curation, modeling and experiment. RY: methodology, supervision, and writing. XZ: review and editing. All authors contributed to the article and approved the submitted version.

The work was supported by the National Natural Science Foundation of China (no. 71802021, no. 71602008), Beijing Natural Science Foundation (no. 9184023), Beijing Municipal Education Commission Foundation (BJSJ2020001, BJSJ2019001, BJSJ2018009), the Fundamental Research Funds for the Central Universities (no. FRF-BD-20-15A, no. FRF-BR-20-01C) and Beijing Philosophy and Social Science Planning Project (no. 21JCC089).

Conflict of Interest

The authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

Publisher’s Note

All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article, or claim that may be made by its manufacturer, is not guaranteed or endorsed by the publisher.

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Keywords: sustainable innovation, corporate social responsibility, heavy pollution industry, business environment, sustainable development

Citation: Yan R, Li X and Zhu X (2022) The Impact of Corporate Social Responsibility on Sustainable Innovation: A Case in China’s Heavy Pollution Industry. Front. Psychol . 13:946570. doi: 10.3389/fpsyg.2022.946570

Received: 17 May 2022; Accepted: 09 June 2022; Published: 04 July 2022.

Reviewed by:

Copyright © 2022 Yan, Li and Zhu. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY) . The use, distribution or reproduction in other forums is permitted, provided the original author(s) and the copyright owner(s) are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

*Correspondence: Xiaoning Zhu, [email protected]

Disclaimer: All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article or claim that may be made by its manufacturer is not guaranteed or endorsed by the publisher.

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Research Article

Impact of the Sustainable Development Goals on the academic research agenda. A scientometric analysis

Roles Conceptualization, Investigation, Supervision, Validation, Writing – original draft, Writing – review & editing

Affiliation Research Institute on Policies for Social Transformation, Universidad Loyola Andalucía, Córdoba, Spain

Roles Conceptualization, Investigation, Methodology, Supervision, Validation, Writing – original draft, Writing – review & editing

Affiliation Public Policy Observatory, Universidad Autónoma de Chile, Santiago, Chile

* E-mail: [email protected]

Affiliation Department of Finance and Accounting, Universidad Loyola Andalucía, Córdoba, Spain

Roles Conceptualization, Investigation, Supervision, Writing – original draft, Writing – review & editing

Affiliation Social Matters Research Group, Universidad Loyola Andalucía, Córdoba, Spain

• Antonio Sianes, 
• Alejandro Vega-Muñoz, 
• Pilar Tirado-Valencia, 
• Antonio Ariza-Montes

• Published: March 17, 2022
• https://doi.org/10.1371/journal.pone.0265409
• Peer Review
• Reader Comments

Today, global challenges such as poverty, inequality, and sustainability are at the core of the academic debate. This centrality has only increased since the transition from the Millennium Development Goals (MDGs) to the Sustainable Development Goals (SDGs), whose scope is to shift the world on to a path of resilience focused on promoting sustainable development. The main purpose of this paper is to develop a critical yet comprehensive scientometric analysis of the global academic production on the SDGs, from its approval in 2015 to 2020, conducted using Web of Science (WoS) database. Despite it being a relatively short period of time, scholars have published more than five thousand research papers in the matter, mainly in the fields of green and sustainable sciences. The attained results show how prolific authors and schools of knowledge are emerging, as key topics such as climate change, health and the burden diseases, or the global governance of these issues. However, deeper analyses also show how research gaps exist, persist and, in some cases, are widening. Greater understanding of this body of research is needed, to further strengthen evidence-based policies able to support the implementation of the 2030 Agenda and the achievement of the SDGs.

Citation: Sianes A, Vega-Muñoz A, Tirado-Valencia P, Ariza-Montes A (2022) Impact of the Sustainable Development Goals on the academic research agenda. A scientometric analysis. PLoS ONE 17(3): e0265409. https://doi.org/10.1371/journal.pone.0265409

Editor: Stefano Ghinoi, University of Greenwich, UNITED KINGDOM

Received: September 10, 2021; Accepted: March 1, 2022; Published: March 17, 2022

Copyright: © 2022 Sianes et al. This is an open access article distributed under the terms of the Creative Commons Attribution License , which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

Data Availability: All relevant data are within the manuscript and its Supporting Information files.

Funding: The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript.

Competing interests: The authors have declared that no competing interests exist.

1. Introduction

1.1. from the millennium agenda to the 2030 agenda and the sustainable development goals (sdgs).

To track the origins of the 2030 Agenda for Sustainable Development, we must recall the Millennium Agenda, which was the first global plan focused on fighting poverty and its more extreme consequences [ 1 ]. Approved in 2000, its guiding principle was that northern countries should contribute to the development of southern states via Official Development Assistance (ODA) flows. The commitment was to reach 0.7% of donors’ gross domestic product [ 2 ] to reduce poverty by half by 2015. The relative failure to reach this goal and the consolidation of a discourse of segregation between northern and southern countries [ 3 ] opened the door to strong criticism of the Millennium Agenda. Therefore, as 2015 approached, there were widespread calls for a profound reformulation of the system [ 4 ].

The world in 2015 was very different from that in the early 2000s. Globalization had reached every corner of the world, generating development convergence between countries but increasing inequalities within countries [ 5 , 6 ]. Increasing interest in the environmental crisis and other global challenges, such as the relocation of work and migration flows, consolidated a new approach to development and the need of a more encompassed agenda [ 7 ]. This new agenda was conceived after an integrating process that involved representatives from governments, cooperation agencies, nongovernmental organisations, global business, and academia. The willingness of the 2030 Agenda to ‘leave no one behind’ relies on this unprecedented global commitment by the international community [ 8 ].

As a result of this process, in 2015, the United Nations General Assembly formally adopted the document “Transforming our World: the 2030 Agenda for Sustainable Development” [ 9 ], later known as the 2030 Agenda. This new global agenda is an all-comprising strategy that seeks to inform and orient public policies and private interventions in an extensive range of fields, from climate change to smart cities and from labour markets to birth mortality, among many others.

The declared scope of the Agenda is to shift the world on to a path of resilience focused on promoting sustainable development. To do so, the 2030 Agenda operates under the guidance of five principles, formally known as the ‘5 Ps’: people, planet, prosperity, peace, and partnerships [ 10 ]. With these pivotal concepts in mind, the Agenda has established a total of 17 Sustainable Development Goals (SDGs) and 169 specific targets to be pursued in a 15-year period, which reflects the scale and profound ambition of this new Agenda.

The SDGs do not only address what rich countries should do for the poor but rather what all countries should do together for the global well-being of this and future generations [ 4 ]. Thus, the SDGs cover a much broader range of issues than their predecessors, the Millennium Development Goals [ 11 ], and are intended to be universal on the guidance towards a new paradigm of sustainable development that the international community has been demanding since the 1992 Earth Summit [ 7 , 12 , 13 ].

Despite this potential, some criticise their vagueness, weakness, and unambitious character. Fukuda-Parr [ 14 ], see weaknesses on the simplicity of the SDGs, which can lead to a very narrow conception that reduces the integral concept of development. The issue of measurement is also problematic; for some researchers, the quantification of objectives not only reduces their complexity, but leads to them being carried out without considering the interdependencies between the objectives [ 12 , 13 ]. Other authors have identified difficulties associated with specifying some of the less visible, intangible aspects of their qualitative nature such as inclusive development and green growth [ 14 , 15 ]. Finally, Stafford-Smith et al. [ 16 ] state that their successful implementation also requires paying greater attention to the links across sectors, across societal actors and between and among low-, medium-, and high-income countries.

Despite these criticisms, the SDGs have undoubtedly become the framework for what the Brundtland report defined as our common future. Unlike conventional development agendas that focus on a restricted set of dimensions, the SDGs provide a holistic and multidimensional view of development [ 17 ]. In this line, Le Blanc [ 12 ] concludes that the SDGs constitute a system with a global perspective; because they consider the synergies and trade-offs between the different issues involved in sustainable development, and favour comprehensive thinking and policies.

1.2. Towards a categorization of the SDGs

There is an underlying lack of unanimity in the interpretation of the SDGs, which has given rise to alternative approaches that allow categorizing the issues involved in their achievement without losing sight of the integral vision of sustainable development [ 15 , 18 – 23 ]. However, such categorization of the SDGs makes it possible to approach them in a more holistic and integrated way, focusing on the issues that underlie sustainable development and on trying to elucidate their connections.

Among the many systematization proposals, and following the contributions of Hajer et al. [ 19 ], four connected perspectives can strengthen the universal relevance of the SDGs: a) ‘planetary boundaries’ that emphasize the urgency of addressing environmental concerns and calling on governments to take responsibility for global public goods; b) ‘The safe and just operating space’ to highlight the interconnectedness of social and environmental issues and their consequences for the redistribution of wealth and human well-being; c) ‘The energetic society’ that avoids the plundering of energy resources; and d) ‘green competition’ to stimulate innovation and new business practices that limit the consumption of resources.

Planetary boundaries demand international policies that coordinate efforts to avoid overexploitation of the planet [ 24 ]. Issues such as land degradation, deforestation, biodiversity loss and natural resource overexploitation exacerbate poverty and deepen inequalities [ 21 , 25 – 27 ]. These problems are further compounded by the increasing impacts of climate change with clear ramifications for natural systems and societies around the globe [ 21 , 28 ].

A safe and just operating space implies social inclusivity that ensures equity principles for sharing opportunities for development [ 15 , 29 ]. Furthermore, it requires providing equitable access to effective and high-quality preventive and curative care that reduces global health inequalities [ 30 , 31 ] and promotes human well-being. Studies such as that of Kruk et al. [ 32 ] analyse the reforms needed in health systems to reduce mortality and the systemic changes necessary for high-quality care.

An energetic society demands global, regional and local production and consumption patterns as demands for energy and natural resources continue to increase, providing challenges and opportunities for poverty reduction, economic development, sustainability and social cohesion [ 21 ].

Finally, green competition establishes limits to the consumption of resources, engaging both consumers and companies [ 22 ] and redefining the relationship between firms and their suppliers in the supply chain [ 33 ]. These limits must also be introduced into life in cities, fostering a new urban agenda [ 34 , 35 ]. Poor access to opportunities and services offered by urban centres (a function of distance, transport infrastructure and spatial distribution) is a major barrier to improved livelihoods and overall development [ 36 ].

The diversification of development issues has opened the door to a wide range of new realities that must be studied under the guiding principles of the SDGs, which involve scholars from all disciplines. As Saric et al. [ 37 ] claimed, a shift in academic research is needed to contribute to the achievement of the 2030 Agenda. The identification of critical pathways to success based on sound research is needed to inform a whole new set of policies and interventions aimed at rendering the SDGs both possible and feasible [ 38 ].

1.3. The relevance and impact of the SDGs on academic research

In the barely five years since their approval, the SDGs have proven the ability to mobilize the scientific community and offer an opportunity for researchers to bring interdisciplinary knowledge to facilitate the successful implementation of the 2030 Agenda [ 21 ]. The holistic vision of development considered in the SDGs has impacted very diverse fields of knowledge, such as land degradation processes [ 25 , 26 ], health [ 39 ], energy [ 40 ] and tourism [ 41 ], as well as a priori further disciplines such as earth observation [ 42 ] and neurosurgery [ 43 ]. However, more importantly, the inevitable interdependencies, conflicts and linkages between the different SDGs have also emerged in the analyses, highlighting ideas such as the need for systemic thinking that considers the spatial and temporal connectivity of the SDGs, which calls for multidisciplinary knowledge. According to Le Blanc [ 12 ], the identification of the systemic links between the objectives can be a valuable undertaking for the scientific community in the coming years and sustainable development.

Following this line, several scientific studies have tried to model the relationships between the SDGs in an attempt to clarify the synergies between the objectives, demonstrating their holistic nature [ 12 , 17 , 20 , 44 , 45 ]. This knowledge of interdependencies can bring out difficulties and risks, or conversely the drivers, in the implementation of the SDGs, which will facilitate their achievement [ 22 ]. In addition, it will allow proposing more transformative strategies to implement the SDG agenda, since it favours an overall vision that is opposed to the false illusion that global problems can be approached in isolation [ 19 ].

The lack of prioritisation of the SDGs has been one of the issues raised regarding their weakness, which should also be addressed by academics. For example, Gupta and Vegelin [ 15 ] analyse the dangers of inclusive development prioritising economic issues, relegating social or ecological inclusivity to the background, or the relational aspects of inclusivity that guarantee the existence of laws, policies and global rules that favour equal opportunities. Holden et al. [ 46 ] suggest that this prioritisation should be established according to three moral criteria: the satisfaction of human needs, social equity and respect for environmental limits. These principles must be based on ethical values that, according to Burford et al. [ 47 ], constitute the missing pillar of sustainability. In this way, the ethical imperatives of the SDGs and the values implicit in the discourses on sustainable development open up new possibilities for transdisciplinary research in the social sciences [ 46 , 47 ].

Research on SDG indicators has also been relevant in the academic world, as they offer an opportunity to replace conventional progress metrics such as gross domestic product (GDP) with other metrics more consistent with the current paradigm of development and social welfare that takes into account such aspects as gender equality, urban resilience and governance [ 20 , 48 ].

The study of the role of certain development agents, including companies, universities or supranational organisations, also opens up new areas of investigation for researchers. Some studies have shown the enthusiastic acceptance of the SDGs by companies [ 22 , 49 ]. For Bebbington and Unerman [ 50 ], the study of the role of organisations in achieving the SDGs should be centred around three issues: challenging definitions of entity boundaries to understand their full impacts, introducing new conceptual frameworks for analysis of the context within which organisations operate and re-examining the conceptual basis of justice, responsibility and accountability. On the other hand, the academic community has recognized that knowledge and education are two basic pillars for the transition towards sustainable development, so it may also be relevant to study the responsibility of higher education in achieving the SDGs [ 47 , 50 ]. Institutional sustainability and governance processes are issues that should be addressed in greater depth through research [ 47 ].

Finally, some authors have highlighted the role of information technologies (ICT) in achieving the SDGs [ 23 ] and their role in addressing inequality or vulnerability to processes such as financial exclusion [ 51 ], which opens up new avenues for research.

Despite this huge impact of the SDGs on academic research, to the best of our knowledge, an overall analysis of such an impact to understand its profoundness and capillarity is missing in the literature. To date, reviews have focused on the implementation of specific SDGs [ 52 – 61 ], on specific topics and collectives [ 62 – 70 ], on traditional fields of knowledge, now reconsidered in light of the SDGs [ 71 – 73 ] and on contributions from specific regions or countries [ 74 , 75 ]. By relying on scientometric techniques and data mining analyses, this paper collects and analyses the more than 5,000 papers published on the SDGs to pursue this challenging goal and fill this knowledge gap.

This article aims to provide a critical review of the scientific research on SDGs, a concept that has emerged based on multiple streams of thinking and has begun to be consolidated as of 2015. As such, global references on this topic are identified and highlighted to manage pre-existing knowledge to understand relationships among researchers and with SDG dimensions to enhance the presently dispersed understanding of this subject and its areas of further development. A scientometric meta-analysis of publications on SDGs is conducted to achieve this objective. Mainstream journals from the Web of Science (WoS) are used to identify current topics, the most involved journals, the most prolific authors, and the thematic areas around which the current academic SDG debate revolves.

Once Section 1 has revised on the related literature to accomplish the main objective, Section 2 presents the research methodology. Section 3 presents the main results obtained, and Section 4 critically discusses these results. The conclusion and the main limitations of the study are presented in Section 5.

2. Materials and methods

In methodological terms, this research applies scientometrics as a meta-analytical means to study the evolution of documented scientific knowledge on the Sustainable Development Goals [ 76 – 81 ], taking as a secondary source of information academic contributions (i.e. articles, reviews, editorials, etc.) indexed in the Web of Science (WoS). To ensure that only peer-reviewed contributions authored by individual researchers are retrieved and that such publications have a worldwide prestige assessment, all of them should be published on journals indexed in the Journal Citation Report (JCR), either as part of the Sciences Citation Index Expanded or the Social Sciences Citation Index [ 82 – 84 ].

Following the recommendations of previous studies [ 85 ], it was decided to apply the next search vector from 2015 to 2020 to achieve the research objectives TS = (Sustainable NEAR/0 Development NEAR/0 Goals), which allows the extraction of data with 67 fields for each article registered in WoS.

As the first step, to give meaning to subsequent analyses, we tested the presence of exponential growth in the production of documented knowledge that allows a continuous renewal of knowledge [ 76 , 86 ].

As a second action, given the recent nature of the subject studied, it is of interest to map the playing field [ 87 ] using VOSviewer software version 1.6.16 [ 88 ], to know which topics are most addressed in the matter of SDGs. This analysis seeks an approach, both through the concentration of Keyword Plus® [ 89 ] and by analysing the references used as input in the production of knowledge, which can be treated as cocitations, coupling-citations and cross-citations [ 90 ], using the h-index, in citation terms, as discriminant criteria in the selection of articles [ 91 – 93 ]. This methodology will allow us to establish production, impact and relationship metrics [ 80 , 85 , 87 , 94 , 95 ].

Finally, it is of interest to explore the possible concentrations that may arise. Using Lotka’s Law, we estimated the possible prolific authors and their areas of work in SDGs, and using Bradford’s Law, we conducted a search of a possible adjustment to a geometric series of the concentration zones of journals and therefore a potential nucleus where a profuse discussion on SDGs is taking place [ 96 – 100 ].

3.1. Configuration of the academic production on SDGs

The results present a total of 5,281 articles for a period of six years (2015–2020) in 1,135 journals, with over 60% of these documents published in the last two years. The total of articles is distributed among authors affiliated with 7,418 organisations from 181 countries/regions, giving thematic coverage to 183 categories of the Journal Citation Report-Web of Science (JCR-WoS). Table 1 shows the distribution among the top ten JCR-WoS categories, highlighting the prevalence of journals indexed in green and environmental sciences and, thus, in the Science Index-Expanded.

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3.2. Existence of research critical mass

Fig 1 shows the regression model for the period 2015–2020, the last year with complete records consolidated in the Web of Science. The results obtained show significant growth in the number of studies on SDGs, with an R 2 adjustment greater than 96%. The exponential nature of the model shows that a ‘critical mass’ is consolidating around the research on this topic, as proposed by the Law of Exponential Growth of Science over Time [ 76 ], which in some way gives meaning to this research and to obtaining derived results.

https://doi.org/10.1371/journal.pone.0265409.g001

3.3. Establishment of concentrations

In accordance with Lotka’s Law, 22,336 authors were identified of the 5,281 articles under study. From this author set, 136 (≈sqrt (22,336)) are considered prolific authors with a contribution to nine or more works. However, a second restriction, even more demanding, is to identify those prolific authors who are also prolific in contemporary terms. Although SDG studies are recent, the growth production rates are extremely high. As previously shown, for the period 2015–2020, 64% of the publications are concentrated between 2019–2020. Based on this second restriction, for 3,400 articles of the 5,281 articles published in 2019 and 2020, and a total of 15,120 authors, only eight prolific authors manage to sustain a publication number that equals or exceeds nine articles. These authors are listed and characterized in Table 2 .

https://doi.org/10.1371/journal.pone.0265409.t002

The analysis shown in Table 2 highlights the University of Washington’s participation in health issues with Murray and Hay (coauthors of eight articles in the period 2019–2020), who are also important in the area of health for the prolific authors Yaya and Bhutta. The environmental SDGs mark a strong presence with Abhilash, Leal-Filho and Kalin. The affiliation of Abhilsash (Banaras Hindu University) is novel, as it is not part of the classic world core in knowledge production that is largely concentrated in the United States and Europe. It is worth noting that other prolific authors belong to nonmainstream knowledge production world areas, such as Russia or Pakistan. Professor Alola also deserves mention; not only is he the only contemporary prolific author producing in the area of economics, but he is also producing knowledge in Turkey.

In the same way, at the journal level, the potential establishment of concentration areas and determination of a deep discussion nucleus are analysed using Bradford’s law.

With a percentage error of 0.6%, between the total journal number and the total journal number estimated by the Bradford series, the database shows a core of 18 journals (2%) where one in three articles published are concentrated (see Table 3 ).

https://doi.org/10.1371/journal.pone.0265409.t003

Regarding the number of contributions by journal, Sustainability has the largest number of studies on SDGs, in which 689 (13%) of the 5,281 articles studied are concentrated. The Journal of Cleaner Production, indexed to WoS categories related to Environmental SDGs, is the second most prominent journal, with 2.7% participation of the articles (147). Both journals are followed by the multidisciplinary journal Plos One, with 2.2% of the total dataset. In terms of impact factor, the 60 points of the health journal The Lancet are superlative in the whole, which in the other cases ranges between 2.000 and 7.246. As shown in Table 4 , we have developed a “Prominence ranking” by weighting article production by impact factor. This metric shows The Lancet, with only 40 articles on SDGs, as the most relevant journal, followed by Sustainability, which becomes relevant due to the high number of publications (689) despite an impact factor of 2.576. These journals are followed by the Journal of Cleaner Production with 147 articles and an impact factor of 7.246.

https://doi.org/10.1371/journal.pone.0265409.t004

3.4. Thematic coverage

Concerning the thematic coverage, Fig 2A and 2B show a diversity of 7,003 Keyword Plus® (KWP), consistently connected to a total of 7,141 KWP assigned by Clarivate as metadata to the set of 5,281 articles studied, which presents a strong concentration in a small number of terms (red colour in the heat map generated with VOSviewer version 1.6.16).

a) Keywords Plus® heatmap and b) heat map zoom to highlight the highest concentration words, data source WoS, 2020.

https://doi.org/10.1371/journal.pone.0265409.g002

Based on this result, a concentration sphere with 85 KWP (= sqrt (7,141)) is established according to Zipf’s Law, which is presented in 50 or more articles out of the total of 5,281. Moreover, a central concentration sphere of 9 KWPs (= sqrt (85)) can be found, with keywords present in a range of 178 to 346 articles out of a total of 5,281. These nine pivotal keywords are all connected in terms of co-occurrence (associated by Clarivate two or more to the same article) and within papers with an average number of citations in WoS that vary from 9.27 to 16.69, as shown in Table 5 . The nine most prominent key words in relation to the study of the SDGs are health, climate change, management, impact, challenges, governance, systems, policy and framework. These terms already suggest some of the themes around which the debate and research in this area revolves.

https://doi.org/10.1371/journal.pone.0265409.t005

The prominence of these keywords is obtained by combining the level of occurrence and average citations (see Table 5 ): on the one hand, the occurrence or number of articles with which the KWP is associated (e.g., Management, 346) and, on the other hand, the average citations presented by the articles associated with these words (e.g., Framework. 9.27). The final score (prominence) mixes both concepts, given the product of the occurrences and the average citations of each KWP in proportion to the mean values (e.g., (330 * 16.69)/(246 * 11.96) = 1.9).

3.5. Relations within the academic contributions

The coupling-citation analysis using VOSviewer identifies the 5,281 articles under study, of which only those found in the h-index as a whole have been considered (the h-index in the database is 81, as there are 81 articles cited 81 or more times). The bibliographic coupling analysis found consistent connections in only 73 of these articles, gathered in seven clusters. Such clusters and unconnected articles are represented in Fig 3 .

Data source WoS. 2020.

https://doi.org/10.1371/journal.pone.0265409.g003

In simple terms, discrimination belonging to one cluster or another depends on the total link number that an article has with the other 80 articles based on the use of the common references. Table 6 specifies the articles belonging to the same publication cluster in relation to Fig 3 .

https://doi.org/10.1371/journal.pone.0265409.t006

Bibliographic coupling analysis can also be used to link the seven clusters that use common references with the field document title (TI), publication name (SO), Keyword Plus-KWP (ID), and research areas (SC). This allows the identification of the main topics of each cluster. As shown in Table 7 , cluster 1 (red) concerns environmental and public affairs; cluster 2 (green), health; cluster 3 (blue), economics; cluster 4 (yellow), health–the burden of disease; cluster 5 (violet), economics–Kuznets curve; cluster 6 (light blue), energy; and cluster 7 (orange), soil—land.

https://doi.org/10.1371/journal.pone.0265409.t007

3.6. Outstanding contributions in the field

The cocitation analysis identified a total of 232,081 references cited by the 5,281 articles under study. It suggests taking as references to review those that present 44 or more occurrences in the database (232,081/5,281). This method results in 34 articles that have been used as main inputs for the scientific production under analysis, cited between 44 and 504 times. A result worth highlighting is that one in three of these documents corresponds to reports from international organisations, such as the United Nations (UN), United Nations Educational, Scientific and Cultural Organization (UNESCO), United Nations International Children’s Emergency Fund (UNICEF), United Nations Fund for Population Activities (UNFPA), World Bank Group (WB) or World Health Organization (WHO). However, it is also possible to identify 21 peer-reviewed scientific contributions. These papers are identified in detail in Table 8 .

https://doi.org/10.1371/journal.pone.0265409.t008

The cocitation analysis yields the degree of relationship of these 21 most cited research articles. It is how such references have been used simultaneously in the same article. Fig 4 displays this information (to help readers, it has also been included in Table 8 , centrality in 21 column).

https://doi.org/10.1371/journal.pone.0265409.g004

According to the relationship level in the most cited article’s selection, the graph ( Fig 3 ) has been clustered in three colours: cluster 1 in red colour groups the highest articles proportion (9) published between 2013 and 2017 in 7 journals. These journals present an impact factor (IF) quite heterogeneous, with values ranging from 2.576 (Sustainability) to 60.39 (Lancet) and indexed in one or more of the following WoS categories: Environmental Sciences (4 journals), Green & Sustainable Science & Technology (4), Environmental Studies (2), Development Studies (1), Medicine, General & Internal (1), Multidisciplinary Sciences (1) and Regional & Urban Planning (1). Three of these articles are cited 130–150 times in the 5,281-article dataset and, at the same time, show a connection centrality of 95–100% with the other 20 articles in the graph, implying a high level of cocitation. The other two clusters group six articles each. The articles of cluster 2 (green colour) are included in a widespread WoS category set: Environmental Sciences (3 journals), Geosciences, Multidisciplinary (2), Ecology (1), Economics (1), Energy & Fuels (1), Environmental Studies (1), Green & Sustainable Science & Technology (1), Materials Science, Multidisciplinary (1), Meteorology & Atmospheric Sciences (1) and Multidisciplinary Sciences (1). The research of Nilsson [ 101 ] was used as a reference in 176 of the 5,281 articles under study, showing a centrality of 100%. This great connection level is also featured in another less cited article [ 17 ] published in Earth’s Future. Finally, cluster 3 (blue) highlights six articles concentrated in three highly cited journals in the WoS categories: Medicine, General & Internal (Lancet) and Multidisciplinary Sciences (Nature and Science), whose IFs range from 41.9 to 60.4. In general, they are articles less connected (cocited) to the set of 21, with centralities of 30–90%. Two of these articles were referenced 140 times or more, although one was published in 2009. Thus, cluster 3 concentrates the references mainly in journals on environmental issues with scientific-technological orientation, as well as classic and high-impact WoS journals (The Lancet, Nature and Science). It is worth noting that some of these top journals may not be listed in Table 4 as they are not included in the Bradford’s nucleus, due to their comparatively low number of contributions published.

Finally, continuing with the thematic study, a cross-citation analysis was developed. Considering only the 81 articles that are part of the h-index of the total set of 5,821 articles under study, the citations that are presented among this elite article set are explored using VosViewer. The cross-citation analysis detects existing relationships between 37 of these 81 articles. Once the directionality of the citations has been analysed, a directed temporal graph is generated using Pajek 64 version 5.09, which is presented in Fig 5 .

https://doi.org/10.1371/journal.pone.0265409.g005

Fig 5 shows how these 37 highly cited articles are related to each other (the number after the name is the publication year), considering that some of these articles are cited as references in other articles in this set. The relationships between the articles in Fig 5 are complex and should be understood under a temporal sequence logic in the citation between two articles. However, some trends can be highlighted.

On the one hand, some contributions stand out for their centrality. Lim et al. [ 102 ] is connected with eight of the 37 articles (21.6%) on citing relationships, as is Fullman et al. [ 27 ], which relates to seven of the 37 articles (18.9%). Both authors researched health issues and are also coauthors of nine articles of the dataset under study. On the other hand, according to the SDG segmentation proposed, Hajer et al. [ 19 ] and Le Blanc [ 12 ] are recognized as seminal articles in social SDGs, since they contribute to the production of other subsequent articles in the set of 37. On the other hand, in health matters, seminal articles are Norheim et al. [ 103 ] and You et al. [ 104 ], two articles published in The Lancet whose citations also contribute to the production of the set introduced as Fig 5 .

4. Discussion

The main purpose of this paper was to develop a critical and comprehensive scientometric analysis of the global academic literature on the SDGs from 2015 to 2020, conducted using the WoS database. The attained results have made it possible to comprehend and communicate to the scientific community the current state of the debate on the SDGs, thus offering insights for future lines of research.

To achieve the objectives, the present study analysed a broad spectrum of 5,281 articles published in 1,135 WoS journals. A first aspect that is striking is the great diversity of topics addressed in these studies, which reflects the multidimensionality of the SDGs. Despite this, more than half of the articles are concentrated in two JCR-WoS categories (Environmental Sciences and Green Sustainable Science Technology), a percentage that exceeds 80% if the categories Environmental Studies and Public Environmental Occupational Health are added. Thus, on the one hand, the size of the body of literature and the broad spectrum of topics more than covers the four perspectives of analysis that are relevant in research on the SDGs, according to Hajer et al. [ 19 ]: planetary boundaries, the safe and just operating space, the energetic society and, last, green competition. However, on the other hand, results also highlight a strong focus on the environmental aspects of the SDGs, which undoubtedly concentrate the most contributions.

The Sustainable Development Goals constitute an area of research that has experienced exponential scientific growth, a tendency already suggested by previous studies [ 81 , 105 ], thus complying with the fundamental principles of Price’s law [ 76 ], which suggests the need for this exponential growth to manifest a continuous renewal of knowledge on the subject under study. The results of this study highlight a significant increase in the number of articles published in the last two years, given that six out of ten articles were published in 2019 or 2020. This tendency confirms how the SDGs continue to arouse great interest in the scientific community and that the debate on the interpretation of sustainable development is still open and very present in academia.

The variety of knowledge areas from which science can approach the SDGs demonstrates the different avenues that exist to address different research questions and their multidimensional nature, as anticipated by Pradhan et al. [ 17 ], a dispersion not far from the traditional fields of knowledge or the conventional dimensions of sustainability. Investigating the reasons for this dispersion in academic research on the SDGs may be a topic of great interest, as anticipated by Burford et al. [ 47 ] and Le Blanc [ 12 ], since understanding the phenomenon of development can only be achieved if the main challenges, both current and future, can be viewed holistically and comprehensively. Along these lines, Imaz and Eizagirre [ 106 ] state that the complexity of the study of the SDGs is undoubtedly marked by their aspiration for universality, by their broad scope encompassing the three basic pillars of sustainable development (economic development, environmental sustainability and social inclusion) and by their desire for integration, motivated by the complexity of the challenges and by the countless interlinkages and interdependencies.

This natural multidimensionality of the SDGs calls for strong cooperation and collaboration between researchers, universities, and countries. In this sense, the scientometric analysis provides good news, as more than a hundred prolific authors (defined as those authors who have published nine or more articles on this topic) have been identified, although these are reduced to eight in contemporary terms (2019 or 2020). This select group of eight authors who lead research and publishing on the SDGs (sometimes with dual or triple affiliations) produce knowledge for universities and research centres both in the global north and the global south: Canada, the U.S., the UK, Germany, Pakistan, Turkey, India, Benin, Russia and Cyprus. The protagonist role played by research institutes in countries in the north has already been acknowledged by previous studies [ 81 , 105 ]. However, the emergence of top scholars producing academic knowledge from developing countries is a more recent tendency, which underscores the pertinence of this analysis.

A closer look at the academic and research curricula of these authors leads to the conclusion that the study of the SDGs does not constitute a final field of research at present. These researchers come from very heterogeneous disciplines, so their approach to the SDGs is also multidisciplinary. To illustrate it with an example, the most cited article by Professor Abhilash of Banaras Hindu University (the most published contemporary prolific author along with Christopher Murray of the University of Washington), with 363 WoS citations in February 2021 alone, is on the use and application of pesticides in India.

In more concrete terms, following Wu et al.’s [ 23 ] classification as a frame of reference, the eight most prolific contemporary authors approach the SDG research problem from two main domains, one of an environmental nature (Abhilash, Leal-Filho, Alola and Kalin) and the other related to health (Murray, Yaya, Bhutta, and Hay). The most common journals where these authors publish on environmental issues are the Journal of Cleaner Production, Higher Education, Water and Science of the Total Environment. Health researchers, on the other hand, tend to publish mainly in the journals of the BMC group, The Lancet and Nature.

This wide diversity of academic fora can be clarified with the application of Bradford’s laws, which identified a core of 18 journals that bring together the debates and academic discussions about the SDGs. It is worth noting that the 18 journals that form the core are distributed in 16 different thematic areas or WoS categories: Development Studies; Ecology; Economics; Education & Educational Research; Engineering, Environmental; Environmental Sciences; Environmental Studies; Green & Sustainable Science & Technology; Hospitality, Leisure, Sport & Tourism; International Relations; Medicine, General & Internal; Multidisciplinary Sciences; Public, Environmental & Occupational Health; Regional & Urban Planning; and Water Resources. On the one hand, this wide dispersion in terms of areas of knowledge suggests that research on the SDGs can be studied from different approaches and disciplines, which opens up a wide range of possibilities for researchers from different branches of scientific knowledge, as well as an opportunity for multidisciplinary collaborations. On the other hand, this heterogeneity might also hinder the communication and dissemination of learning from one field to another. The cross-citation analysis provided in Fig 5 suggests this possibility, as seminal works are related to thematic disciplines more than to the seminal contributions identified in Table 8 .

In this sense, it is interesting to analyse the top-cited articles in the database, as they provide a clear picture of the field of knowledge. One-third of these contributions are provided by international institutions, such as the United Nations Development Program or the World Bank, which provide analyses of a normative nature. This prevalence reflects some weaknesses in the academic basis of the analysis of the SDGs as a whole from a scientific approach, an idea reinforced when the most cited papers are analysed. In fact, only six papers have reached more than 100 citations by contributions included in the database [ 4 , 12 , 24 , 29 , 101 , 107 ]. Not only were these papers largely published before the approval of the SDGs themselves, but half of them are editorial material, inviting contributions but are not evidence-based research papers. Highlighting the nature of the most cited contributions does not diminish their value but does speak to the normative approach that underlies the analysis of the SDGs when addressed not individually but as an overall field of research.

Regarding topics and themes of interest, the scientometric analysis carried out in this research identified a strong concentration around a small number of terms, as represented in a heat map ( Fig 2A and 2B ). All these topics constitute a potential source of inspiration for future research on the subject.

Through an analysis of the main keywords, it can be seen that the studies focused on the traditional areas of health and climate change. However, these keywords also provide new elements for discussion, as they uncover some other areas of study that have been highlighted by the literature. First, the appearance of the term Management as one of the main keywords reveals the importance that researchers give to the role of business in achieving the SDGs, as already suggested by Scheyvens et al. [ 49 ] and Spangenber [ 22 ]. Second, the need to address new governance processes and to seek global solutions, as suggested by authors such as Sachs [ 4 ], underscore the keywords Governance, Policy and Framework, all aspects deemed crucial for the achievement of the SDGs and the 2030 Agenda [ 108 ]. Finally, other keywords such as Impact, Challenges or Systems are a clear example of the complexity and interdependencies that exist in research on the SDGs, considered an essential aspect by Griggs et al. [ 13 ] or Le Blanc [ 12 ]. The attained results highlight some of the connections between different domains of sustainable development by identifying categories and themes that are highly related in the groupings that emerge from the bibliographic coupling analysis.

In general terms, the holistic vision of development embodied by the SDGs has drawn the attention of very different disciplines, fields and areas of scientific knowledge. However, seven major areas of research have emerged: environmental and public affairs, health, economics, health-burden of disease, economics-Kuznets curve, energy and soil-land. These areas are not far removed from the current paradigm of sustainable development, where poverty or inequality are problems that are not exclusive to developing countries [ 5 , 6 ]. Thus, emerging issues that mainly affect first world countries, including urban planning, the impact of activities such as hospitality, sport or tourism, or education for development, are starting to stand out with increasing intensity, which continues to open new avenues for future research.

In short, the results of the scientometric analysis have provided a systematized overview of the research conducted in relation to the SDGs since the approval of the 2030 Agenda. Among other things, the critical analysis has identified the main trends with respect to the number of publications, the most relevant journals, the most prolific authors, institutions and countries, and the collaborative networks between authors and the research areas at the epicentre of the debate on the SDGs. As Olawumi and Chan [ 105 ] already acknowledged, the power research networks applied to the study of the SDGs offer valuable insights and in-depth understandings not only of key scholars and institutions but also about the state of research fields, emerging trends and salient topics.

Consequently, the results of this work contribute to the systematic analysis of scientific research on the SDGs, which can be of great interest for decision-making at the governmental level (e.g., which research to fund and which not to fund), at the corporate level and at the level of research centres, both public and private. Furthermore, the scientometric analysis carried out may provide clues for academics regarding future lines of research and topics of interest where the debate on the SDGs is currently situated.

5. Conclusions, limitations and future research lines

As could not be otherwise, all research in the field of social sciences has a series of limitations that must be clearly and transparently explained. The two most relevant in this study are the following.

First, although the study of the SDGs is a recent object of research, the rate of publication is growing exponentially, such that scientific knowledge is renewed practically in its entirety every two years. The only articles that escape this scientometric obsolescence are those with a high number of citations (h-index). This circumstance generates a temporal limitation in terms of the conclusions obtained in the present investigation, conclusions that should be revised periodically until the growth of publications stabilizes by adopting a logistic form, as recommended by Sun and Lin [ 109 ].

Second, the articles used as the basis for this research were restricted to those published in the JCR-WoS. This decision was made for two main reasons. On the one hand, the limitation was to eliminate potential distortions that could occur as a result of the constant growth of journals that are incorporated annually into other databases, such as ESCI-WoS (Emerging Sources Citation Index). On the other hand, it is impossible to compare impact indices if integrating other databases such as Scopus.

We are aware of these limitations, which for developing a more selective analysis imply assuming the cost of less coverage in exchange.

Regarding future lines of research, the analysis highlights how the study of the SDGs is failing to balance their economic, social and sustainability components, as it still maintains an overall focus on environmental studies.

This suggests the urgency of increasing studies on social SDGs, key topics on the 2030 Agenda including equity (SDGs 4, 5 and 10), social development (SDGs 11 and 16) and governance (SDG 17). These topics are part of the public discourse and currently a source of social pressure in many latitudes, but they are still research areas that are necessary to deepen.

Economic sustainability studies are more present, but highly concentrated, in health economics, as previously acknowledged by Meschede [ 81 ]. Academic research on the SDGs against poverty (SDG 1) and hunger (SDG 2) has not achieved such a prominent place as health. Even less so, the economics of technological development (SDGs 8 and 9), which are recognized as crucial for economic development.

Finally, the environmental SDGs do not achieve a balance among themselves either. Academic research has prioritized action for climate (SDG 13) and industrial and human consumption, mainly water (SDG 6) and energy (SDG 7). New research should be developed in the area of land (SDG 15), life under the sea (SDG 14) and sustainable production (SDG 12).

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Research on China’s regional carbon quota allocation based on the entropy weight-TOPSIS method and CRITIC-VIKOR model

• Published: 07 April 2024

Cite this article

• Yuan Zhang 1 ,
• Zhen Yu 2 ,
• Juan Zhang 3 &
• Wenjie Zhang 4  

Carbon trading policy is an essential market-oriented emission reduction tool for achieving China’s carbon goals. Developing a reasonable and feasible initial carbon quota allocation plan is the key to the effective operation of carbon trading policy. In this article, a multi-principle indicator system based on fairness, efficiency, feasibility, and sustainable development is constructed using panel data from 2005 to 2019 at the provincial and eight primary economic region levels. The carbon quota allocation scheme uses the Entropy Weight TOPSIS method, the CRITIC-VIKOR, and the combination allocation models. The research results indicate significant differences in carbon emissions among different provinces and regions, and constructing a more objective and comprehensive carbon emission allocation indicator system is the key to whether the carbon emission allocation is reasonable. Then, there are significant differences in the allocation results of different allocation models. Through comparative analysis of model results, it can be seen that the combination allocation model has a good allocation effect. Meanwhile, analyzing the allocation of regional carbon quotas makes it possible to accurately identify the degrees of surplus and deficit in eight regions. This is conducive to improving the rationality of carbon quota allocation and reducing the relative exploitation between regions. This study is conducive to achieving a reasonable allocation of regional carbon quotas. It helps promote the smooth operation of the national unified carbon market and achieve the overall carbon emission reduction target.

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Acknowledgements

This research is supported by vocational education in Shandong (No.23SSK044), Shandong Provincial Natural Science Foundation (No. ZR2023QE212), Basic Research Projects of Science, Education, and Industry Integration Pilot Project of Qilu University of Technology Shandong Academy of Sciences) (No. 2023PX031), and the Natural Science Foundation of Qingdao (No.23-2-1-121-zyyd-jch).

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Zhang, Y., Yu, Z., Zhang, J. et al. Research on China’s regional carbon quota allocation based on the entropy weight-TOPSIS method and CRITIC-VIKOR model. Environ Dev Sustain (2024). https://doi.org/10.1007/s10668-024-04804-1

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Corporate Social Responsibility (CSR): The Role of Government in promoting CSR

Asan vernyuy wirba.

MIT Department, Jubail Industrial College (JIC), Royal Commission for Jubail and Yenbu, Jubail Industrial City, Jubail, KSA Saudi Arabia

This paper examines corporate social responsibility (CSR) and the role government can play in promoting CSR. Corporations are an integral part of the large economy of any given society or country whereby these corporations operate. The government’s role is critical in promoting CSR activities or agendas because CSR is voluntary without mandatory legislation. The method used in this paper is a normative literature review and secondary data procedures. The research results show the need for developed and developing countries to share CSR’s best practices and build human institutions capable of enhancing CSR agendas by creating awareness, soft laws, partnering, and mandating business enterprises to be transparent in solving society’s problems wherever they operate. Governments in some developed nations have taken a far-reaching agenda in promoting CSR, especially the UK, European Union, the USA, and other developing countries in East Asia. However, developing countries are lagging behind in developing CSR agendas but should not simply copy from developed countries but adopt CSR’s agenda susceptive to their multiple nations’ sustainable and equitable developments. The result also shows that the lack of good governance and transparency in abundant natural resources in developing countries in the south has led to corrupt elites diverting CSR activities funds for their self-interest and not their local communities. Some developing countries still see CSR as an act of philanthropy, not as means for sustainable and equitable development for economic growth, hence the lack of transparency surrounding CSR by the various government and their elites.

Introduction

The principle of corporate social responsibility (CSR) is one of the concepts used by business corporations to contribute to various communities and societies wherever they operate voluntarily without any mandatory legislation. CSR is an emerging concept that is gaining popularity all over business organizations. CSR also refers to companies taking account of the social and environment, not just the financial consequences of their actions. United Nations Industrial Development Organization UNIDO ( 2022 ) sees CSR as being the way through which a company achieves a balance of economic, environmental, and social imperatives (“Triple-Bottom-Line-Approach”) while at the same time addressing the expectations of shareholders and stakeholders. CSR is a voluntary act of cooperation. CSR should fulfill the social responsibility of advancing the social well-being of those where they are operating. The World Bank Group ( 2004 ) acknowledges that the modern corporate social responsibility (CSR) agenda is evidence that businesses are a part of society and contribute positively to societal goals and aspirations. CSR is fundamentally a process of managing the costs and benefits of business activity to internal and external stakeholders, ranging from employees, shareholders, and investors to customers, suppliers, civil society, and community groups. According to the European Commission ( 2006 ), the role of government concerning CSR agenda is vital, even though CS agenda or activities are based on the voluntary action by companies and as an instrument for accountability and responsibility. Thus, the role of governments in promoting and developing CSR in developed and developing countries is vital to ensure effective well-being for all through collaboration, although CSR is voluntary. The recent COVID-19 pandemic is a wake-up call for both developed and developing countries to collaborate. To this effect, He and Harries ( 2020 ) argue that the uncertainty triggered by COVID-19 has caught the entire world off guard – radically changing the way the world is perceived – and is likely to have an impact on CSR in years to come. Bapuji et al. ( 2020 ) also acknowledged that the effects of the COVID-19 pandemic have prompted the private sector to respond to this challenge through its CSR actions, integrating environmental and social aspects into its business activities, avoiding unethical practices, such as price increases, thus testing companies’ ethical commitment. To this effect, Idemudia ( 2009 ) argues that the community is the best neighbor of a company, and they are both interconnected. Businesses and communities are partners with mutual interests based on the win–win approach. Boadi et al. ( 2019 ) also attest to the fact that communities offer firms social licenses to operate their business operations in society. We have seen a lot of efforts by many corporations coming to the aid of a people divested by natural disasters—for example, the Asian Tsunami and the Ebola crisis in Africa. Droppert and Bennett ( 2015 ) also attest to the fact that many companies are responding to various epidemiological and demographic shifts such as HIV/AIDS, Middle East Reparatory Syndrome (MERS), Severe Acute Reparatory Syndrome (SARS), and Ebola in Africa, more importantly, the current pandemic COVID-19 which indicate the role some corporation has played in making sure that the pandemic is confronted and be eradicated. Droppert and Bennett ( 2015 ) further argue that due to increasing pressure from civil society to act as a socially responsible organization, companies worldwide are reforming and expanding their CSR strategies to fit them with the dynamic world. According to Mahmud et al. ( 2020 ), CSR is treated as an excellent tool for accomplishing sustainable development by offering a win–win strategy. No business can survive by using a win-lose strategy. Thus, the influence of corporations in our communities and societies at large is unquestionable and commendable. Hence, the World Bank Group developed good practices to be flowered by developing countries with regards to CSR to enhance the collaborative approach between the developed and developing countries since most of the corporations dealing with gas and oil explorations and forestry products originated from the north and also because we are in it together. A study by Sindakis and Minhas argues that collaboration requires interaction between participatory parties. Therefore, the government in developed and developing countries need to interact to share the best practices for CSR. Hence, the government’s role in promoting CSR needs support to ensure that rules, responsibilities, and accountabilities are taken seriously, although CSR is a voluntary instrument by businesses with no mandatory legislation. The government can ensure that corporations work according to the rules and norms of each nation or society. Governments can legislate, foster, partner with businesses, and endorse good practices to facilitate CSR development. Tang et al. argue that the government plays a direct role in promoting CSR implementation. Zueva and Fairbrass ( 2021 ) also argue that there is a growing body of literature that shows that national governments around the world are promoting CSR through a variety of practices (Albareda et al., 2007 , 2008 ; González & Martinez, 2004 ; Podsiadlowski & Reichel, 2014 ; Rossouw, 2005 ; Vallentin 2015 ; Waagstein, 2011 ). For Zueva and Fairbrass ( 2021 ), academics and practitioners (as well as society in general) widely regard governments as the key societal actors capable of compelling businesses to practice corporate social responsibility (CSR).

The UK government is one of the pioneering countries in promoting the role of government in promoting CSR. Their CSR activities impacted the economy, society, and environment in enhancing sustainability (DTI, 2004 ). Thus, the role of government in promoting CSR is vital and should be encouraged and developed further. UK government created a minister of state responsible for CSR. The argument advanced by ) that the social responsibility of a company is to increase its profit has served its time, and the world has moved on since then.

The Background of the Study

The background on CSR stems from the fact that since time immemorial, businesses or companies have always used CSR to give back to society while strengthening the brand reputation whereby they operate. The evidence of business concerns giving back to society date back to the history of the industrial revolution and the need to solve social problems of poverty which lead to philanthropy.

The aim and objective of the paper are to examine corporate social responsibility (CSR) and the role of governments in promoting CSR in both developed and developing countries. CSR activities can create goodwill in the societies they operate, improve public perception of the enterprise, and foster some positive attitudes toward the company. Most corporations operating in developing countries are western and are required to share best practices of CSR with these countries in order to improve some social issues that may elevate poverty in developing countries. Thus, the significance of this paper is to shed light on CSR as practiced in developed countries so that developing countries can learn from the best practices in implementing CSR activities and the role governments play in promoting CSR as a means of continuous improvement.

We live in a world whereby governments, particularly businesses and civil societies, cannot do everything alone without others. The above discussion and arguments are only possible in the words of Coming (2020), and together, we will get through this; Kigo also argues that the COVID-19 pandemic has taught us an important lesson about ourselves as a human community: We are interconnected with and interdependent each other in ways we did not fully understand before. My health and well-being are dependent on your health and well-being, and the same principle applies beyond borders and regions. Thus, CSR principles, activities, or agendas and the role played by the government are vital for economic growth and development in any given community or society, and sharing the best practices of CSR by developed and developing countries is vital for the growth and development of mankind. Collaboration and sharing of good practices of CSR are great for both developed and developing nations. Thus, what is CSR?

Definitions of CSR

Corporate social responsibility (CSR) has multiple meanings. CSR is a complex idea and can correlate with several values. CSR is also related to the corporate environment and the environment or community it operates. CSR is considered philanthropic behavior toward society. Bowen defines CSR as “the duty of entrepreneurs to follow these policies, to make those decisions, or to follow those lines of action that are desirable in terms of our society’s goals and values.” Davis ( 1973 ) also describes CSR as the consideration of problems outside the company’s restricted financial, technological, and legal requirements. On the other hand, Carroll describes CSR as “an economic, legal, ethical and discretionary expectation (philanthropic).” On the other hand, some studies have tried to define CSR in terms of stakeholder and social perspectives. The stakeholder perspective of CSR is based on Freeman’s ( 1984 ) argument that businesses have responsibilities for groups and individuals who can both influence and be influenced by business operations. For him, the major social responsibilities of corporations consist of community service, the improvement of relationships with employees, job creation, environmental protection, and financial returns. Hopkins ( 2003 ), who is of the stakeholder perspective, argues that CSR is to treat a company’s stakeholders morally and responsibly to attain the two-fold goal of maintaining profit and improving the living standard of stakeholders inside and outside the company.

The social perspective of CSR is reflected in Kotler’s ( 1991 ) definition of CSR as a means of running a firm to maintain and improve social well-being. Mohr et al. ( 2001 ) also reflect the social perspective when they define CSR as the commitment made by a company to remove or reduce its adverse impact on society and boost the long-term beneficial influence on society. The social perspective addresses societal issues at the core of CSR. In other words, CSR policies reflect their responsibilities to advance social interests, while the stakeholder’s perspective profits at the forefront of CSR. Carroll ( 1979a , b ) emphasized that a company’s social responsibility covers the discretionary, ethical, legal, and economic expectations that humanity has of organizations at a particular time. Carroll framed a pyramid of CSR in trying to explore the nature of CSR and examine its parts, especially for the executive who wish to reconcile their obligations to their shareholders with those other competing groups claiming legitimacy philanthropic requirements: donation, gifts, helping the poor. It ensures goodwill and social welfare. Ethical responsibility: Follow moral and ethical values to deal with all the stakeholders. Economic responsibility: Maximize the shareholders’ value by paying a good return. Legal responsibility: Abide the laws of the land.

Nazari et al. ( 2012 ) also define CSR as having four social responsibilities of a company: economic, legal, ethical, and philanthropic responsibility. Ali and Lasmono view CSR as having four responsibilities: ethical, economic, philanthropic, and legal perspective. The World Bank ( 2004 ) defines CSR as the commitment of business to contribute to sustainable economic development—working with employees, their families, the local community, and society to improve the quality of life in ways that are both good for business and business good for development. According to European Commission ( 2001 , 2002 , 2006 ), corporate social responsibility (CSR) “is a concept whereby companies integrate social and environmental concerns in their business operations and their interaction with their stakeholders voluntarily.” EC (ibid) acknowledged that CSR enterprises are deciding to go beyond minimum legal requirements and obligations stemming from collective agreements to address societal needs; hence, CSR enterprises of all sizes, in cooperation with their stakeholders, can help to reconcile economic, social, and environmental ambitions. Thus, CSR has become an increasingly important concept globally and within the EU. For EC (ibid), the promotion of CSR reflects the need to defend shared values and increase the sense of solidarity and cohesion. Carroll ( 2016 ) presents a four-part concept structure known as the economic obligation, the legal obligation, the ethical responsibility, and the philanthropic responsibility required by society. Furthermore, Carroll ( 1979a , b ) viewed CSR as policies and procedures adopted by the company to ensure that shareholders are recognized and covered in their strategies and operations by society or stakeholders. Hence, CSR activities and actions should be purely voluntary and considered a social responsibility. Meanwhile, McWilliams and Siegel define CSR as actions that appear to further some social good beyond the interests of the firm and that which is required by law. For them, this definition underscores to them that CSR means going beyond obeying the law. On the other hand, Jason defines CSR as a self-regulating business model that helps a company to be socially accountable – to itself, its stakeholders, and the public. Ollong ( 2014 ) defined CSR as the relationship between business and society, where the role of business is purported to go beyond the provision of goods and services. The European Commission (EC, 2011 ) defines CSR as “business accountability for its effect on society and what a business can do to fulfill that accountability.” EC ( 2006 ) defines CSR as “a term through which companies voluntarily incorporate social and environmental issues into their business activities.” Their relationship with their stakeholders. Smith ( 2001 ) defines CSR as “the obligations of the firm to its shareholders – people affected by corporate policy practices. These obligations go beyond the legal requirements and duties of a firm to its shareholders. Thus, the fulfillment of these obligations is to minimize any harm and maximize the long-run beneficial impact on the firm in the society.” Subsequently, Lantos ( 2001 ) also defines CSR as “an imperative responsibility steaming from the implicit social contract between company and society for businesses to respond to long-term needs and to maximize the positive impact on society.” Here are some of the best practices of CSR: (1) set a feasible, viable, and measurable goal, (2) build a lasting relationship with the community, (3) retain the community’s core values, (4) assess the impact of CSR, (5) report the impact, and (6) create community awareness.

Scholars such as McWilliam and Siegel see CSR as the corporation’s interest and its stakeholders, such as workers, civil society groups, customers, and the government, to demand that CSR’s principles and efforts are applied. The World Business Council for Sustainable Development (WBCSD, 1999 ) defines CSR as a commitment by a company to behave ethically and contribute to economic development while improving the quality of life of its workforce and family members, as well as the local community at large. On the other hand, the EC commission ( 2001 ) defines CSR as a definition by which businesses voluntarily decide to enhance society and a healthier climate in the context of the green paper. In subsequent years, in their communication number 681 (2011), the European legislators return to this topic of CSR, describing CSR as the responsibility of companies for their effect on society. The UK government, on the other hand, accepted a higher commercial interest responsibility for the private sector in 2001.

Crane et al. ( 2008 ) define CSR as a set of company values such as follows: (1) voluntary activities that go beyond those prescribed by law; (2) internalizing or managing negative externalities, for example, a reduction in pollution; (3) multiple stakeholder orientation and not only focusing on shareholders; (4) alignment of social and economic responsibilities to maximize the company’s profitability; (5) practices and values about why they do it; and (6) more than philanthropy alone.

Van der Heijden et al. ( 2010 ) argue that CSR is a search process that requires company leaders to develop their organization-specific balance between people, planet, and profit. These values, dimensions, and search processes have to be incorporated into organizational policies and accepted by employees to function. Some view the voluntary statutes of CSR as not going far as having mandatory legislation. To this effect, Fox ( 2004 ) cited Ward’s ( 2004 , 3) argument, which shows that CSR is an enterprises’ contribution (both positive and negative) to sustainable development. Hence, The World Bank’s working definition which views CSR as the commitment of business to contribute to sustainable economic development, working with employees, their families, the local community, and society at large to improve the quality of life in ways that are both good for business and good for development. Fox ( 2004 ) concluded that the new CSR agenda fail to fulfill its potential contribution to development because it is voluntary business activities dominated by actors from the north, and it all focuses on the large enterprise. For him, there is a need for a more balanced and pragmatic approach that recognizes a business case for the responsibility which are in line with the development priorities and, at the same time, creates an enabling environment for responsible business in the south, building human and institutional capacity to generate agenda for development needs. For Fox ( 2004 ), the CSR agenda should be built around the core principles of sustainable and equitable development. For United Nations Industrial Development Organization (UNIDO) 2022 , the key CSR issues are environmental management, eco-efficiency, responsible sourcing, stakeholder engagement, labor standards, and working conditions, employee and community relations, social equity, gender balance, human rights, good governance, and anti-corruption measures. Thus, a properly implemented CSR concept can bring along a variety of competitive advantages, such as enhanced access to capital and markets, increased sales and profits, operational cost savings, improved productivity and quality, efficient human resource base, improved brand image and reputation, enhanced customer loyalty, better decision making, and risk management processes. Some scholars are critical of CSR and see it as a smokescreen for deregulation and a window dressing for reckless conduct. For Boctanski, CSR is one of the least nuanced attempts to disguise its rising control over social life created by management-created supremacy, and for ), a firm’s only responsibility is to do business and make a profit.

The Role of Government in CSR promotion

The interest of governments in promoting CSR is not new because business objectives cannot be done in any given society without government involvement, either voluntarily or legally. The government has a stake in making sure that CSR objectives are well-coordinated.

In a study conducted in the United Kingdom by Moon ( 2004 ), the state’s position in promoting CSR is due to social governance deficits reflecting satellite and marketplace vulnerabilities, and ongoing and evolving societal demands are making government-recognized CSR contributions in the UK. Moon ( 2004 ) further illustrated that the effort of the UK government to institutionalize CSR was due to the realization of the government that it could not provide all the solutions to its society in the inner cities and therefore wanted the private sector to play a pivotal role. The UK government has since seen the importance of CSR and appointed a minister designated to CSR.

The speech by the then Prime Minister of Britain, Gorden Brown, cited by Moon ( 2004 ), illustrates the importance of CSR in the UK. The speech by the then Prime Minister of Britain Gorden Brown (Moon, 2004 ) highlights the relevance of in the UK of CSR as he asserts that “Today, corporate social responsibility goes far beyond the old philanthropy of the past, by giving money for good causes at the end of the financial year is a responsibility that companies accept for the environment around them. It is a good working practice for companies to engage in their local communities and understand that brand names depend not only on quality, price, and uniqueness but on how they interact with companies’ workforce, community, and environment.” There is more on the role of government in the literature review.

Methodology

A normative literature review is an approach used in this paper. A study done by Sindakis et al. ( 2022 ) used a systematic literature review to analyze the theoretical concepts of the resource-based view and resource-based theory by using relevant keywords and academic databases. However, the researcher used a normative literature review in this paper. According to Routio ( 2005 ), the normative method parallels system analysis and design, addresses a problem area for vulnerability, and explores the transition probability. Normative literature reviews aim at summarizing or synthesizing what has been written on a particular topic, in the case of this study CSR and the role played by the government to promote CSR but do not seek generalization or cumulative knowledge from what is reviewed. In this study, the researcher selected studies that support the view concerning the topic of study, and content analysis is also used when needed. Normative literature texts that contain knowledge are labeled positively as a possibility of action. Carroll ( 1979a , b ) provides a very practical viewpoint in which normative CSR can be interpreted as the social responsibility of the business that encompasses the economic, legal, ethical, and discretionary expectations that society has of organizations at a given point in time. Haase ( 2015 ) argues that normative concern is an idea “good for society” in terms of the diverse entities for which the results in facilitation. The Haase ( 2015 ) study concluded that normative aspects of CSR ethics inform about related values, norms, and principles. The review of literature as a method helped synthesize the available knowledge of CSR, which enables us to know the fact and evidence about CSR and be able to draw data sources to solve the problem of the research. The literature reviews in this paper seek to summarize existing research by identifying patterns, themes, and issues as well as helping to identify the conceptual content of the field and furthering theory development (Seuring & Müller, 2008 ). Levy and Ellis ( 2006 ) similarly define a literature review as a sequence of steps for collecting, comprehending, analyzing, synthesizing, and evaluating published research to provide a firm foundation for a topic. The literature review in this paper brings credibility to writing about CSR. This literature review sheds light on CSR practice and the role of government in promoting CSR, in general, irrespective of a country in both developed and developing countries.

Theoretical Framework of CSR and Literature Review

There are many theoretical frameworks for CSR. In other words, CSR’s theoretical framework will be analyzed and reviewed through the lens of some of its theories. This paper examined the artificial entity, the aggregate, collaborative, stakeholder, political, social contract, legitimate, corporate sustainability, and corporate accountability theory. These theoretical frameworks shed light on CSR, hence informed practice. The artificial entity theory’s basic assumption is that all of the economic activity conducted by a business is separate from that of its owners. The main idea here is that all corporation activities are a limited liability or separation of ownership from control. Under this theory, the owners of the corporations are not personally responsible for the company loan, and liabilities creditors cannot go after the owner’s assets. According to Chaffee, the artificial entity implies that a company is nothing more than the legal structures to which the state gives life and that the company owes its existence to the government. Palmiter ( 2009 ) notes that a company is a structure within which modern business relationships with individuals. Therefore, the government or the state is at the core of this corporate principle. Without the consent of a government granting the right and privilege of life, companies do not exist.

TAs argued by Freeman ( 1984 ), the stakeholder approach assumes that the management of the diverse interest within a company can be improved and enhanced by maintaining a balance between shareholders’ internal and external needs. Freedman further states that company stakeholders are those “groups without whose sponsorship the business will cease to exist.” Such groups include staff, clients, political action organizations, vendors, local governments, financial institutions, media, environmental groups, policy organizations, and financial institutions. The core principle of this philosophy is that business should be motivated not only by profit but also by interest, intention, and ethics. This theory also emphasizes addressing the need of all stakeholders, particularly the quiet local communities and the environment. Thus, the organizational responsibilities go beyond profit maximization. Dellaportas et al. ( 2005 ) attest that if there is no balance between human rights and the company’s duty in that field, the company becomes a winner when society becomes a loser. A win–win partnership should be adopted by companies and societies. The review of the literature of this paper focuses on the most relevant academic publication, books, and other sources relevant to CSR, whether historical or modern means synthesis of the available knowledge of a specific area and literature refers to the knowledge and information about the concepts, definition, and theories used in the concerned field of investigation. The review of literature helps a researcher to know the facts and evidence available to solve the research problem.

Friedman ( 1970 ) argues that a company’s primary social duty is to use its capital for profit. In an article in New York Times, Freedman wrote that there is only one social responsibility of business which is to use its resources and engage in activities designed to increase its profits as long as it stays within the rules of the game, which is to engage in open and free competition without deception or fraud. Furthermore, Chafee ( 2017 ) suggests that it may be reasonable to assume that corporations should be interested in socially responsible actions, but because of the nature of the organization and the theoretical nature of corporations, it is far from being understood. Chafee ( 2017 ) concluded that the present theories for firms, the concern theory, real entity theory, and engagement theory partly describe how corporate firms exist. But, it fails to explain why the company exists. Chaffee argues that while each of these corporate theories has some relevance, none of them provides a full description of what a company is. He attests to the fact that although some of these theories may seem contradictory, they have some foundation in reality. He suggested merging these three theories to form collaboration theory which explains why corporation exists. Corporations exist to make money, but they also have a social responsibility to the communities they operate in, either financially or in any other form.

Today, we cannot deny that business has created an impact on a different area of society, either on employees, society, or the environment. Many corporations all over the globe have mobilized resources to help their communities in great numbers. Some companies have made financial donations toward health facilities in their local communities or to their various governments to help fight the COVID-19 pandemic. A study conducted by Cheema-Fox et al. ( 2020 ) on corporate resilience and response during COVID-19 concluded that companies with more positive sentiment exhibit higher institutional investor money flows and less negative returns than their competitors. This is especially true for companies with more salient responses. A study also done by Mahmud et al. ( 2021 ) concluded that CSR leaders in the USA adopted various mechanisms for protecting their employees, continuing customer services, and caring communities through diversified CSR – the COVID-19 initiatives. They contested that it was the best time to become together (maintaining social distance practices and health professionals’ guidelines) to save the people and make the earth more beautiful than ever it was. At this time, firms should look not only for financial performance but also for society’s benefit and the welfare of their stakeholders, such as partners, families, employees, customers, and communities. At this moment of crisis, the corporation did not think only about its profits but the various communities and societies they operate.

It is evident from Mahmud et al.’s ( 2021 ) finding that the COVID-19 pandemic has people living in a go-ahead and penetrating time, although it adversely affects the earth and causes shocks for governments, businesses, communities, families, and individuals worldwide. Businesses are ongoing to help all of their stakeholders circumnavigate difficulties as businesses always do. As communities also respond to the global public health crisis caused by COVID-19, most companies’ focus also remains on supporting their employees’ health and income while caring for their customers and communities. In this regard, Owens Corning’s representative remarked is very important when he said that “These are extraordinary times that remind us of the power of the human spirit and how much we can overcome when we come together. And together, we will get through this.” This is remarkable. The same sentiment as made by Owens Corning was also echoed by Kingo ( 2020 ), the CEO and Executive Director of United Nations Global Compact; she argued that the COVID-19 pandemic had taught us an important lesson about ourselves as a human community: We are interconnected with and interdependent in ways we did not fully understand before. My health and well-being are dependent on my health and well-being, and the same principle applies beyond borders and regions. Indeed, our collective health defines the health of businesses and economies within and across nations. This new awareness has born a sense of solidarity and interdependency that I have found heartwarming. We care about each other. She argues that when the pandemic hit, the global compact was among the first initiatives to issue a call to action to all businesses. We said that it would have huge economic and social impacts and that they needed to double down on their responsibilities regarding our 10 business principles – based around human rights, labor, anti-corruption, and the environment – and the 2030 Agenda for Sustainable Development, the UN’s blueprint for change …furthermore, that the UN Global Compact left companies in no doubt that the way forward is not to just zoom in on their financial bottom line, but to become even more responsible, and anchor the Principles and the Sustainability Goals in their business. Thus, the human spirit is such that when faced with a challenge such as this COVID-19 pandemic, try to work together. Many companies have remained resilient in supporting their partners, employees, customers, and communities where they do business. Although the pandemic is very tough, many companies have adopted different approaches, such as working from home, social distancing, and travel restrictions, as well as offering other incentives such as paid leave and sick pay to remain afloat. All these approaches were geared toward a common good between the companies and their customers. Some corporations have purchased products and machinery equipment to fight this pandemic. For example, in the USA, Blue Cross Blue Shield Minnesota funded 100 kits with surgical drape material that were prepared by partner Knit & Bolt for community volunteers to make 2500 N95 mask covers for North Memorial Health in mid-April according to corporate citizenship response to Covid-19 (2020). Some companies converted their production line or chain to produce useful tools to use by doctors and nurses in hospitals, such as masks, gowns, hand sanitizers, and respirators. Some companies have even allowed their employees to work from home and given some financial support to their communities. Thus, CSR activities that are beneficial to customers, employees, and the general public would create an everlasting impact.

For example, during the COVID-19 pandemic, many corporations provided help in their time of need to their communities, while some companies tried to take advantage of the COVID-19 pandemic crisis by raising the prices of their products and behaving unethically. However, many corporations or companies acted ethically and provided financial support and donations to their various communities or various governments. The likes of Ferrari Company used its production chain for car manufacturers to produce valves for respirators to be used in hospitals by doctors and nurses during the COVID-19 pandemic. Armani decided to use its production chain to make personal protective equipment (PPE) for hospitals. Some corporations in the United Kingdom converted their production chains to produce personal protective equipment (PPE), ventilators, and sanitizers, while others donated their product or money to hospitals to help fight the pandemic. Meanwhile, some supermarkets allocated some time for the elderly and NHS workers.

In Cameroon, some corporations like SCR MAYA, UBA group, and businessman Baba Dan Pullo and others donated money to President Paul Biya’s created Solidarity Fund to fight against coronavirus. Corporations in Cameroon should embrace the CSR agenda and activities as that cooperation’s helped societies in need, especially during the COVID-19 pandemic. Thus, firms or cooperation with authentic CSR activities will always build a strong relationship with their customers and the general public whenever they operate. Hence, there is strong evidence to show that citizens and businesses, during this crisis, donated money and equipment to help those in need. The help from the citizens and from the corporation will always have a significant and eternal impact on their clients, communities, and the countries in which these operate, whether during a crisis or in normal periods or circumstances.

Several business leaders have been very generous to some governments around the world during this pandemic. Jack Ma, for example, the co-founder of Alibaba in China, helped many developing countries in Africa with PPE equipment to protect frontline nurses, doctors, and people to combat the COVID-19 pandemic. Others are the USA base Bill Gates and Melinda Gates, Twitter USA’s Jack Dorsey, and several other company industrialists. These are the realities of CSR activities or agendas in action, a concept that originated from the conviction that businesses have an obligation toward society and humanity at large.

The earlier literature on CSR, according to Rahman, was more oriented toward the organization’s economic philosophy, which seeks to maximize income without disadvantages. For Carroll ( 1999 ), CSR literature dates back to Adam Smith’s work.

The literature on CSR and the role of government in promoting the CSR agenda is in the advanced stage in developed countries, such as the UK, Denmark, Austria, and the European Commission ( 2006 ). Hence, Dahlsrud ( 2008 ) acknowledged that CSR refers to specific firm activities that align their economic, environmental, and social objectives within their strategies and operational decisions. On the other hand, Gavin ( 2019 ) attested to the fact that CSR is a business model in which for-profit companies seek ways to create social and environmental benefits while pursuing organizational goals, such as revenue growth and maximizing shareholder value. McLennan and Banks ( 2019 ) also acknowledge that CSR growth as an emerging research field and more attention to the 21st-century business stem realized that business and society are interconnected in ways that exceed critical relationships between companies’ employees, customers, suppliers, and community. Subsequently, Mugova et al. ( 2017 ) also argue that corporate generosity is to not only create favorable stakeholder attitudes and better supportive behaviors (e.g., employment, purchasing, investment opportunities) but also, over the long run, strengthen stakeholders–company identifications, uphold a corporate image, and shape stakeholders’ socially responsible and advocacy behaviors. Many see CSR as an approach to bring together many aspects of an organization’s strategy that can guide a greater society. According to Batty et al. ( 2016 ), CSR is a voluntary commitment more than modest compliance with government rules and regulations. A study requested by the JURI Committee European Parliament went further to emphasize that CSR has grown to become more central to business operations, with environmental, social, and governance (ESG) principles assuming a pivotal role in the context of the purpose of the corporation and as such CSR roles is committed to ensuring organizations track and achieve their goals. They concluded that the promotion of CSR and RBC, on the other hand, upholding business and human rights, as well as fostering sustainability and the implementation of the UN 2030 Agenda for Sustainable development, had made progress in the following area: (1) encouraging companies to carry out appropriate due diligence along the supply chain; (2) including human rights protection; (3) increasing transparency and promoting sustainable finance; (4) encouraging socially and environmentally friendly business practices, including through public procurement; (5) promoting the implementation of CSR and RBC, including outside the EU, through EU trade instruments and EU’s participation in multilateral fora; (6) developing dedicated approaches for certain specific sectors or companies; and (7) pursuing horizontal approaches, including working with EU’s Member States on National Action Plans.

Research conducted by Moon ( 2004 ) on the role of government in promoting CSR found that governments were interested in CSR production in Denmark and the Netherlands. Moon ( 2004 ) argues that while the United Kingdom and Denmark promoted CSR in the case of Denmark, they give parallel examples, unemployment and social exclusion were high in the 1990s, and Karen Jesperson, Denmark’s then Minister for Social Affairs, was inspired by the Grundfos Company’s CSR. She saw the way business contributed to solving social problems.

) suggested five core themes to be followed by the government in developing countries to promote CSR as follows: (1) building awareness of the CSR agenda and its implications, (2) building capacity to shape the CSR agenda, (3) engaging a stable and transparent environment for pro-CSR investment, (4) engaging the private sector in the public policy process, and (5) frameworks for assessing priorities and developing strategy.

He argues that the relevance of a specific initiative by country may vary, and it is clear from the above discussion that mandating, facilitating, partnering, and endorsing are the vital roles of the government in promoting CSR. Figure  1 below provides a bird-eye view of the key roles of the government across specific themes in promoting CSR.

Four core roles of CSR development

There is also a comprehensive analysis by ) on the government’s position in promoting CSR based on four critical roles as seen in Table ​ Table1, 1 , namely, (1) mandating – defining, under the law of the nation, the minimum requirement for business performance; (2) facilitating and promoting the CSR agenda and delivering social and environmental matters; (3) partnering – enabling public, private, and civil society players; and (4) recognizing or rewarding best practices for companies that manufacture a green product, for example, creating a green product that protects the environment. ) acknowledge that each government has a diverse approach to CSR. For example, western or European countries may differ from developing countries in Africa. To this effect, Gond et al. (2011) argue that the European government often uses public policy means to guide companies to fulfill their CSR, considering that government policies for global economic growth would benefit them. The critical forces for CSR are also government policies and legislation. They gave examples of countries in East Asia, such as Japan, Korea, and China, whose governments are becoming less internationalist and more empowered by civil society. Therefore, their approaches to the CSR agenda are different due to various government and governance structures and policies.

Instrument that the government can use in advancing the CSR agenda

UN Global Compact and Bertelsmann Stiftung ( 2010 ); The World Bank

The UN Global Compact and Bertelsmann Stiftung ( 2010 ) also strengthened the framework governments can use to help CSR: raising awareness, cooperation, soft legislation, and compulsory resources to facilitate and encourage voluntary actions, mandating measures to track and implement corporate responsibility. An instrument that governments can use in advancing the CSR agenda is in Table ​ Table1 1 below. In promoting CSR, these tools are vital for government support.

Studies conducted by Zadek ( 2001 ) indicate that the government should be interested in changing the link between companies and society. To him, voluntary corporate citizenship programs by corporations are inadequate to address deep-rooted social and environmental problems or challenges. He calls for governmental, corporate, and civil society partnerships. Another study conducted by Reich ( 2008 ) rejects that companies determine their CSR and that the political process should be the way to form the private sector’s social responsibility. In other words, collaboration is good for the government, private, and civil society in shaping the CSR agenda. The government to develop alliances with others to promote the CSR agenda that follows their activity in their region. The above studies and reviews of many writers of CSR note that government can play a vital part in the CSR agenda by ensuring business-to-society ties are transparent. The government should not let corporate self-regulate but have a say on how corporations can behave for the benefit of the countries or societies where they operate due to the belief that corporations have a responsibility toward society socially, economically, and environmentally. A study done by Chapagain in Nepal shows that the role of the government in promoting CSR is still inadequate due to the big gap, particularly in endorsing the role of the government, followed by collaborative, regulating, and assisting roles.

Subsequently, a study conducted by Chapple and Moon ( 2005 ) on seven countries on CSR in Asia concluded that CSR is different among these seven countries and was not explained by growth but by factors in the business systems of these countries. They testify that CSR, although pursuing the countries of service, was embraced by multinational corporations.

Fukukawa and Moon ( 2004 ) conducted a study on a Japanese model of CSR. They concluded that Japan’s business model is comparatively “society-friendly” due to features of its corporate governance, strong alignment with government economic policy, and lifelong work. Another study by Albareda et al. ( 2009 ) concluded that the government has been putting policy initiatives to promote CSR. Furthermore, an article written by Kinnear ( 2020 ) shows that CSR started as a voluntary formula of private rule, and now, the government is increasingly involved. Many governments and private industries collaborate to promote social agendas, especially during higher unemployment and social discontent in many countries. Therefore, the collaboration between the government and the private corporation is critical to solving some of society’s problems. A study conducted by Aberada et al. on the changing role of government in CSR concluded that governments have common ground on CSR when associating with private and social sectors. Another study conducted by Bhave ( 2009 ) concluded that by ensuring that companies perform according to the rules and norms of the society in which they work and that companies profit from CSR activities, the government has a role to play. The government should legislate, collaborate, promote business, and support best practices to boost CSR growth. He concluded that the Government of Gujarat in India is promoting CSR programs to encourage social development.

A study by Tamvada ( 2020 ) argues that accountability is partly the regulation of CSR moral responsibility associated with the role of business and the future impacts on society. A vital moral obligation for an organization is the growth of CSR. A study conducted by Sighal in India concluded that the government has a role in ensuring that corporations comply with society’s rules and standards. He suggests that the government can legislate, foster, partner with businesses, and recommend best practices to facilitate CSR expansion. A study conducted by Idemudia ( 2010 ) in the state of Nigeria in the Niger Delta concluded that government support for CSR in Nigeria is still restricted and fragmented, so there is no enabling environment in the Niger Delta that stimulates CSR growth. The reasons for the non-existence are the Nigerian state’s systemic and systematic insufficiencies, which reflect a relationship between the state and society. Due to the nature of the Nigerian state, where the politics of anxiety set in and the government cannot properly enforce a coherent CSR policy structure that supports CSR growth in the Niger Delta, the restriction in implementing CSR again is due to practices in Nigeria. The other drawback is that the government restricts CSR practices that contribute to community growth. The study of Idemudia highlights the constraint between the style of the government and its economic system to implement CSR as an enabling vehicle for community development Niger Delta. Government instrument matters concerning CSR agenda and confusion about who does what at a governmental level can create problems, allocating funds from corporations to society, especially in developing countries. There is a need for great alignment and transparency within a government to ensure that the appropriate people within the communities benefit from the corporation’s CSR agenda.

In Cameroon, there has been a case where local administrative officials and traditional rulers (Chief/Fon) were squabbling in public regarding corporation funds not benefiting their local community, especially forestry products, and mining of the quarries, especially locations near big towns in Cameroon. Local chiefs are not happy that the big companies logging wood products in their area are not developing their communities. There are many cases whereby local authorities and the tribal local rulers disagree in public on who should control funding from corporations exploring their local land. Good governance and transparency within the government at all levels of authority are vital so that boundaries are known to avoid clashes of interest by administrators and auxiliary Chiefs/Fons. Disagreement between the local chief and the administrative authorities can lead to conflict. A previous case involving the late mayor of Njombe Penja, Moungou Division, Littoral Province of Cameroon, when he tried to suspend the mining of the quarry operations of his local municipality of Njombe Penja, created a crisis.

The mayor requested that companies exploiting quarries in his municipality should pay CFA 3 to 5 million monthly for the development of his local community runs into problems due to the over-centralization of power in Cameroon by those in government in Yaoundé, Cameroon. Decentralization of authorities or federation would solve some of these problems in Cameroon.

The present system of government in Cameroon of centralization has led to civil war in the two Anglophone provinces, NOSO (Southern Cameroon). There is a need for proper decentralization, federations, or federalism in Cameroon to foster development and growth.

The government in Cameroon needs to collaborate with businesses to implement CSR agenda so that the local mayors and their localities benefit from the natural resource in their locality or municipality. The political elite seems to be the one benefiting more from corporate activities, especially those relating to forestry, aquarist, and mines, to the detriment of the local poor.

Ngaundje and Kwei’s study ( 2021 ) reflects the reality on the ground in Cameroon, in which there is a disconnect between the practice and implementation of CSR components. As they argue that businesses have abdicated their responsibilities, but governments have also failed to provide a legal framework within which corporations can effectively comply with their obligations. Since the inception of CSR in Cameroon, the Cameroonian government has remained silent on the subject. Companies in the country retain the option of engaging in CSR or not. Corporations cannot be held solely accountable for a country’s social obligations to its citizens. The government should be involved and draft some soft laws for the corporation and the maintenance of law and order, the provision of security, and the provision of public infrastructure and other critical services. They argue that while mobile telecommunication companies (MTN) and other businesses have a social responsibility to the communities in which they operate, the government must provide the framework necessary to ensure they comply with their responsibilities. It is the government’s responsibility to ensure that an adequate regulatory and enforcement framework exists, ensuring businesses operate sustainably. The government in Yaoundé should therefore provide a legal framework within which cooperation engages in CSR agenda or have effective decentralization or federalism so that some of these issues of CSR are resolved at the local level to meet the needs of the people, not the few elites.

Annex conducted a literature review on CSR and Sustainable Development Goals in sub-Saharan Africa, in particular, CSR activities by businesses and organizations in French-speaking sub-Saharan African countries, and concluded that while CSR core values are about business companies’ contribution to society, it is possible to incorporate economic and environmental activities into their agenda. Hence, there is little evidence of policy reforms reflecting CSR activities among businesses representing the sustainable development agenda in sub-Saharan countries. Therefore, there is a need to access CSR practices among corporations regarding healthy and inclusive growth and sustainable development, and this requires government collaboration either at the local or national level. According to a study conducted by Capaldi ( 2016 ), some CSR literature fails to address the economic question of how we value CSR about the loss of resources that could have been used for other purposes, such as shareholder charitable contributions. He asserts that the critical question in CSR scholarship is whether it is descriptive, normative, or something else. According to him, the current normative literature is insufficiently descriptive and philosophically deficient. He proposed several additional CSR research activities (for example, consumer responsibility) that are compatible with a morally pluralistic world conducive to market economies. On the other hand, Walker and Chen ( 2019 ) argue that social innovation is frequently conflated with corporate social responsibility in public discourse.

Anep cited GIZ in a survey showing that the CSR barriers in businesses are in several components, such as policy structure, monitoring, reporting, staff involvement, finance, government, assessment, project management, leadership and governance, and benefits, especially in businesses or businesses in Namibia, South Africa, Kenya, Ghana, Mozambique, and Malawi. He cited the survey GIZ, which concluded that in French-speaking Sub-Saharan African countries such as Cameroon. In a study done by Giron et al. ( 2021 ) on sustainability reporting and firms’ economic performance, evidence from Asia and Africa, cited by Reverte ( 2009 ), argue that media exposure is the most influential variable for explaining CSR disclosure practices of Spanish-listed firms. On the other hand, a study conducted by Heikka and Karayiannis ( 2019 ) explains how corporate social responsibility efforts on the community level by using dialogic methods to learn the needs of the communities. Communities should be the greatest beneficiaries of the CSR agenda and not the elites of those communities, as in many developing countries. The government should take a leading role in implementing various CSR agendas in their various nations.

Oginni and Omojowo ( 2016 ) conducted a study on sustainable development and CSR in sub-Saharan Africa and concluded that industries in Cameroon are above the economic dimension in the order of priority environmental and social magnitudes. Hence, few enterprises implement broad-based CSR to encourage sustainable business practices.

Khan et al. ( 2013 ) conducted an explorative study of CSR in Saudi Arabia and concluded that the government of Saudi Arabia encourages businesses to embrace CSR activities in serving society as a whole. They concluded that, because of the socio-cultural background and Islamic values, Saudi Arabia as a kingdom was historically socially responsible. They argue that CSR activities are more philanthropic than linked to a strategic approach in some Middle East and GCC states. They argue that these companies are very serious about their CSR activity, and so they create separate departments to deal with CSR supported by the top management of these companies. However, they caution that most companies in the Kingdom lack the atmosphere created by Aramco and other enterprises. Saudi Arabia companies need a multi-pronged approach to addressing economic, legal, social, and environmental goals.

Khan et al. ( 2013 ) argue that Islamic ideas are deeply ingrained in Saudi business culture and business conduct of social responsibility because of the Zakat (compulsory charity) principle that is a must for all Muslims. Islam, especially in Middle Eastern countries, has influenced CSR. See the definition of Zakat (compulsory charity) (Quran 51:19) and also the Prophet Muhammad’s words (PBUH). Concerning their societies and society at large, Saudi companies should support CSR initiatives. The policies and practices of the CSR initiative that contribute to the enhancement of community growth and solve problems with employability at the community level and society as a whole are good. Khan et al. ( 2013 ) also stressed the role of educational institutions, business schools, and universities in ensuring that CSR teaching and training were included in the curriculum to benefit businesses and communities as a whole, helping the Kingdom’s development.

Alharthey ( 2016 ) in Saudi Arabia regarding CSR argues that Saudi Arabia’s CSR work is philanthropy influenced by Saudi Arabia’s socio-economic, religious, and cultural perspectives. The government has not pressured or compelled companies to implement socially beneficial policies’ CSR programs. Examining the role of CSR activities in universities, Alharthey concluded that universities are more philanthropic than CSR strategy. Gravem ( 2010 ) did a study in Saudi Arabia on CSR and concluded that CSR in the Kingdom is considered an essential instrument for the private sector to contribute to the growth of Saudi society through the Saudification of the labor force and the diversification of the Kingdom’s economy. The main difference between CSR and Saudi’s international concept is that CSR focuses globally on human rights, labor rights, the climate, and anti-corruption, while CSR focuses globally on human rights, labor rights, and anti-corruption. Research by Ward et al. ( 2020 ) on CSR and developing countries concluded that CSR provides middle- and low-income governments with empirical incentives to enhance business cooperation conditions.

Ngaundje and Kwei ( 2021 ) conducted a study on Cameroon’s mobile phone network corporate social responsibility in Cameroon: the Case of MTN. To help society, they participate in CSR activities such as youth education, volunteer work, and distribution of school supplies and other necessities to those in need. Because of MTN Cameroon’s high-profit margins, they argue little is known about the concept of CSR and how CSR is applied. CSR is still a relatively new concept in Cameroon, which is why big corporations lack CSR policies or a CSR team due to the absence of a comprehensive framework for corporate social responsibility (CSR) policy in the country. CSR is still in its infancy in Cameroon, and the country’s CSR dialog has just begun. A large part of their CSR activities is philanthropy: Companies perform charitable acts.

Ndzi ( 2016 ) affirms the argument made by Ngaundje and Kwei ( 2021 ). CSR concept is relatively new in Cameroon. Hence, many big companies do not have either a CSR policy in place or a team that deals with CSR issues; few companies are identified in Cameroon as having CSR policies in place. One of these companies is the energy of Cameroon (ENEO) which is the hydro-electrical company in Cameroon where she conducted her study. To her, ENEO is one of the companies in Cameroon that has CSR policies and is involved in activities and projects to help the local communities and the country to alleviate poverty. However, the finding from her study indicates that ENEO CSR practices have not been efficient and very limited in these areas. ENEO could be described as not practicing any CSR activities. However, the none existence of CSR activities in these areas does not affect the profitability of the business because ENEO has a monopoly in the market in Cameroon. That is why cooperation in developing countries can put policies and not follow them like ENEO. There is no law requiring these big corporations to follow concerning CSR. In reviewing the literature on CSR from developed and developing countries, it is evident that the government should directly intervene in CSR activities or agenda by introducing soft laws and policies directly related to CSR instead of leaving it to companies to safely regulate or be it voluntary as the case of today. There is a need for the government not only to promote CSR but also to put soft laws or regulations measures and financial incentives to drive these big corporations to give back to the various communities they operate in terms of tax rebirth.

There is a need to understand corporate social responsibilities (CSR) and the role government can play in promoting CSR activities and agenda as practiced in developed western countries and some Asian countries compared to developing countries. Good collaboration between the two in sharing good practices can enhance CSR activities and lead to growth and development instead of seeing CSR as philanthropy in developing countries. Business is not only about making money wherever they operate but also about contributing to the greater good of the society they operate. To this effect, a study done by the JURI Committee European Parliament emphasizes that CSR is central to business operations, with environmental, social, and governance principles assuming a pivotal role in the context of the purpose of the corporation and as such CSR roles is committed to ensuring organizations track and achieve their goals. They concluded that the promotion of CSR should be such that corporations be upholding business and human rights as well as fostering sustainability and the implementation of the UN 2030 Agenda for Sustainable development by doing the following: (1) encouraging companies to carry out appropriate due diligence along the supply chain; (2) including concerning the human rights protection; (3) increasing transparency and promoting sustainable finance; (4) encouraging socially and environmentally friendly business practices, including through public procurement; (5) promoting the implementation of CSR and RBC, including outside the EU, through EU trade instruments and EU’s participation in multilateral fora; (6) developing dedicated approaches for certain specific sectors or companies; and (7) pursuing horizontal approaches, including working with EU’s Member States on National Action Plans.

Research Implication

This study examines CSR and the role of government in promoting CSR. It is evidenced that CSR has multiple meanings with a complex idea and can correlate with several values, for example, environment and the environment or community it operates; it could be considered philanthropic behavior toward society and also can be seen as following policies and activities that are desirable in terms of society’s goals and values. For others, it could be seen as a consideration of problems outside the company’s restricted financial, technological, and legal requirements. But for Carroll, it is an economic, legal, ethical, and discretionary expectation (philanthropic). For Freeman ( 1984 ), it is the business’s responsibility to groups and individuals who can both influence and be influenced by business operations. For Hopkins ( 2003 ), it is a company’s stakeholder’s moral and responsibility to attain the two-fold goal of maintaining profit and improving the living standard of stakeholders inside and outside the company. For Mohr et al. ( 2001 ), it is the commitment made by a company to remove or reduce its adverse impact on society and boost the long-term beneficial influence on society. Scholars who view CSR as a social perspective put social issues at the core of activities, i.e., CSR policies reflect its responsibilities to advance social interests, while the stakeholder’s perspective puts profit at the core of CSR. Whatever the direction of firm CSR activities, developed countries’ governments play a role in promoting CRS based on four critical roles as follows: (1) mandating – defining, under the law of the nation, the minimum requirement for business performance; (2) facilitating and promoting the CSR agenda and delivering social and environmental matters; (3) partnering – enabling public, private, and civil society players; and (4) recognizing or rewarding best practices for companies that manufacture a green product, for example, creating a green product that protects the environment. The government in developed countries also uses some frameworks to help strengthen CSR through awareness raising, cooperation, soft legislation, and compulsory resources to facilitate and encourage voluntary actions, mandating measures to track and implement corporate responsibility. They also create a ministerial department to facilitate the CSR agenda in their countries.

In some developing countries, CSR is inexistence; see a study conducted by Idemudia ( 2010 ). For some, CSR is philanthropic and not geared toward economic development and growth. For some countries, CSR is having religious connotations. Developing countries need to learn from some good practices as developed in the west whereby a government takes an active role in promoting CSR and at the same time creating soft laws that the companies can follow rather than letting it be a voluntary practice by companies. In developing countries, due to the absence of soft laws and regulations, the elite are the ones who benefit, not the masses. Therefore, the government needs to play an important role in promoting CSR. This research has extended the literature review on developed and developing countries and the role the government can play in promoting CSR.

Practical Implications

In terms of practical relevance, the government in both developed and developing countries can play an important part in promoting CSR because CSR is still voluntary without strong legislation behind it. The need for collaboration and sharing of good practices is necessary for developed and developing countries because the majority of these big companies operating in developing countries are mostly western companies. This research is useful for companies or big businesses in the west operating their business in developing countries. CSR activities that follow good legal, environmental, social, and developmental issues in giving back to the communities they operate in would always be trusted. Thus, the four core CSR responsibilities of economic, legal, ethical, and philanthropic are important, and the government has to be involved because they are the one that gives licenses to these companies to operate. Developed countries have already incorporated all these aspects of CSR, economic, ethical, legal, and philanthropic responsibilities within their corporation. Firm managers need to create value for the community in which they operate by giving back to affect growth and development. Developing countries should therefore adopt best practices. For example, the British government sees CSR as a long-term business strategy for giving back to society. Japan’s business model of CSR is comparatively “society-friendly” due to features such as its corporate governance, strong alignment with government economic policy, and lifelong work.

In some developing countries, CSR is in existence or only in corporations palpitate; see a study by Idemudia ( 2010 ) in the state of Nigeria in the Niger Delta which concluded that government support for CSR in Nigeria is still restricted and fragmented, so there is no enabling environment in the Niger Delta that stimulates CSR growth. The reasons for the non-existence are the Nigerian state’s systemic and systematic insufficiencies. Due to the nature of the Nigerian states where the politics of anxiety set in and the government is unable to properly enforce a coherent CSR policy structure that supports CSR growth in the Niger Delta, the restriction in implementing CSR again is due to practices in Nigeria. Also, see a study by Ngaundje and Kwei ( 2021 ) with regards to CSR in Cameroon’s mobile phone network MTN which concluded that CSR is still a relatively new concept in Cameroon, which is why the majority of large corporations lack CSR policies or a CSR team. This is due to the absence of a comprehensive framework for corporate social responsibility (CSR) policy in the country at large. CSR is still seen as philanthropy in some developing countries and needs to be part of growth and development in the developed world and in some countries in the Middle East.

Limitations and Future Research

This present research is constrained by certain limitations. The first of which is that the majority of literature for this study is western. Fewer studies on CSR activities and the role of government in promoting CSR are from developing countries; hence, CSR in developing is new or inexistence, and even if it is in the books of the corporation operating in developing countries, only the elites seem to be benefiting from funds which could go a long way for their development and economic growth instead of seeing it mere philanthropy. In future studies, the researcher will try to gather more literature from developing countries’ perspectives on CSR and the government’s play in promoting CSR.

The outcome of this paper demonstrates that governments should play a proactive role in promoting CSR in any given nation or state, as Caroll ( 1991 ) argues that CSR is “an economic, legal, ethical, and discretionary expectation (philanthropic).” The same sentiment is expressed by Freeman ( 1984 ), who argues that business has responsibilities for groups and individuals who can both influence and be influenced by business operations. Hopkins ( 2003 ) also acknowledged that CSR has four core principles or addenda of economic, legal, ethical, and discretionary expectation (philanthropic) that should not be left only to the corporation’s voluntary means but should be safeguarded and managed so that there is a win–win situation between a corporation and the communities or societies they operate. In some developing countries in Africa, CSR activities are inexistence not implemented, or the elites are the ones who benefit from such funds that could help spur development in those countries. CSR’s best practices should be transferred from developed west to developing countries since most of these corporations operating in developing countries are businesses with origins in the western world, for example, firms operating in mining or forestry products or communication.

Collaboration is vital so that CSR core issues are shared. There is a need for a transfer of best practices of CSR. In promoting CSR activities or agendas, each country or government should carefully consider its own social, economic, cultural, political, and growth situations. Hence, good governance is essential for CSR activities, especially in developing countries where centralization leads to inefficiencies and ineffectiveness. There is a need to avoid situations whereby some oil companies and forestry exploration corporations in developing countries in Africa do not directly benefit their local communities.

Most local communities in developing countries feel abandoned by corporations exploring their natural resources. There is a growing sentiment of anti-western domination, notably when some of these western companies are operating in developing countries and are not implementing CSR activities or are benefiting a small elite in developing countries. Good governance and transparency in the management of natural resources in developing countries concerning CSR agenda are welcome, and best practices should be shared and not kept as a policy that is not used or communicated. The need for local chiefs in developing countries and the local authorities to be transparent in managing local land and its natural resources for local development and growth is essential hence the CSR agenda. Thus, the significant contribution of this paper is that governments should play a proactive role in promoting CSR activities that benefit local communities and their societies. Developing countries’ nature government systems need to be transparent and serve the interest of their people. We need to avoid a situation whereby rich oil countries with significant natural resources do not benefit those at the local level but rather tiny elites who have confiscated the country’s natural resources for themselves only and their families. Developing countries’ governments can use varied instruments in promoting CSR by creating awareness, fostering and partnering, mandating, volunteering, or putting soft legislation in place for corporations to further improve CSR activities that benefit communities at large. Soft legislation will enable some of these corporations to comply with their CSR initiatives. For example, tax exemptions for a business that contributes money to educational, environmental, and social issues are vital for developing countries instead of CSR activities as philanthropic only. CSR should not be seen only as a philanthropic agenda but rather should focus on social, economic, environmental, and legal to spur economic growth and development for developing countries, especially in Africa.

The literature shows that many countries in the west and some developing countries profit from CSR activities and, more importantly, during the COVID-19 pandemic. The result also shows that developing countries should not blindly be copying from western countries’ CSR agendas. They should create CSR agendas that reflect their realities. Developing countries in the south should learn from developed countries’ CSR implementation, for example, the United Kingdom, the USA, Sweden, Denmark, South Korea, Malaysia, Singapore, Saudi Arabia, and India. There should not be a blind adoption of the implementation of the CSR agenda from the north; government and governance must create their own CSR agenda that fit them and their communities’ realities and context. This study contributes to CSR issues in developed countries, including how developing countries can learn from good practices in the developed world to strengthen CSR in developing countries, as well as the role of government in promoting CSR agendas for development and growth rather than seeing CSR as philanthropy. Good collaboration between developed and developing countries in enhancing best practices of CSR is vital because corporations have responsibilities to society that go beyond economic, legal, and moral expectations. Future research is needed to examine CSR agendas in both developed and developing countries and not allow CSR activities to be only a voluntary act by corporations.

This article is part of the Topical Collection on Interdisciplinarity and Transdisciplinarity in Higher Education, Democracy and Economy

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World Economic Situation and Prospects: April 2024 Briefing, No. 180

Debt Sustainability Challenges in Africa: The Role of Domestic Debt

In 2024, more low-income countries are facing debt distress or are at risk of debt distress than ever before. According to the latest IMF low-income countries debt sustainability analysis, 10 countries are in debt distress, while 52 countries are at moderate or high risk of debt distress. Out of these 62 countries, 40 are in Africa. African countries have suffered gravely from global shocks such as the COVID-19 pandemic, the war in Ukraine and spillover effects of high interest rates in many developed countries, which have increased debt levels across the continent. Debt levels are particularly high in the continent’s larger lower middle-income economies, including Egypt at 92 per cent of GDP, Angola at 84.9 per cent, and Kenya at 70.2 per cent.

Whether debt is external or domestic can be assessed along three criteria: currency of issuance, the governing jurisdiction, or residence of debt holders. Domestic debt can therefore be described as debt which is issued in the sovereign’s local currency, or debt which is governed by the domestic sovereign laws. It can also be defined as debt which is held by residents of the issuing sovereign.

Most African countries have historically relied on external debt in the form of long-term concessional financing from multilateral and bilateral lenders, or non-concessional private finance. However, in efforts to diversify financing sources and reduce risks of external debt vulnerabilities, many countries have increasingly turned towards domestic debt markets over the past two decades, reflecting a trend seen more broadly across developing countries. In emerging markets and developing economies, on average, domestic debt made up approximately 58 per cent of debt in 2022 and accounted for approximately 66 per cent of government debt accumulation since 2010.

Domestic debt has, however, presented a new set of challenges on debt sustainability. The S&P Global Africa Domestic Debt Vulnerability Index ranks Egypt, Ghana, Kenya, Mozambique, Angola and Zambia among the most vulnerable countries as of 2023. Due to limits in data availability, subsequent data analysis in the brief will focus largely on these countries. Figure 1 shows the total public debt in selected countries, with the corresponding share of domestic debt. Figure 2 shows the trend in domestic debt accumulation in the selected countries.

Potential benefits derived from domestic debt in Africa

Most of the domestic debt in Africa is denominated in local currencies and is therefore shielded from exchange rate volatility and currency mismatches. Since 2022, a number of African currencies recorded significant depreciation against the US dollar as shown in figure 3. Currency depreciation leads to an increase in foreign currency-denominated external debt. In Kenya for instance, as of December 2023, external debt – 67.3 per cent of which was dollar denominated – increased by $1.3 billion owing in part to depreciation of the Kenyan shilling. As well, approximately 98 per cent of Ghana’s external debt stock growth in 2023 was a result of the cedi’s depreciation against the dollar. Nigeria’s external debt in 2023 also increased by 100.1 per cent over a year because of the naira’s depreciation. Avoiding sharp and unexpected depreciation of domestic currencies can ensure that governments maintain predictability on domestic debt stock and movements. In addition to this, issuance of debt in domestic currency grants central banks and governments flexibility to employ monetary policy tools in domestic debt management.

Domestic debt defaults tend to be rarer than external debt defaults

This could be because policymakers have the option of inflating away domestic debt than recourse to outright default (Herman, Ocampo, and Spiegel, 2012). Also, in countries where domestic financial institutions are the main holders of government domestic debt, effects of a domestic debt default could be severe, and if not properly managed, could result in a widespread financial crisis. In the case of debt default, domestic debt tends to be easier to restructure since it is subject to the jurisdiction of domestic courts. A case study conducted by the IMF on debt restructurings between 1988 and 2020 concluded that domestic debt restructuring took considerably less time to complete compared to external debt restructuring, largely due to a greater sovereign control of the terms and laws governing domestic debt. Additionally, by restructuring domestic debt, countries can avoid the reputational costs associated with external debt restructuring and, in some cases, maintain access to external finance.

Risks associated with domestic debt

Increased reliance on domestic debt, even with the benefits outlined above, carries risks, which if not well managed, could be detrimental to economic growth. One of the key arguments against domestic debt is that it can entail significant crowding-out effects for the domestic private sector. When government is the largest borrower, credit from banking and non-banking financial institutions available to the private sector could diminish (Bua, Pradelli and Presbitero, 2014). Arnone and Presbitero (2010), note that domestic public debt might undermine economic activity through crowding out effects and inflationary pressures if it represents a large share of bank deposits. In Egypt, as of October 2023, domestic public debt was approximately 77 per cent of total domestic credit. In Kenya, as of 2022, exposure of financial institutions to government securities was approximately 40 per cent of the total deposits. As a result, private sector is more credit constrained than the public sector in many African countries. This in turn curtails the private sector’s growth potential since reduced private credit discourages investments into the private sector. Ultimately, crowding out can affect government revenue in the long run if the private sector taxable base grows at a subpar pace, which could in turn hamper the government’s ability to repay its debts. Banks may also find it challenging to adequately diversify their risks, if the high cost of capital leaves a preponderance of more risky projects seeking finance.

Another considerable challenge is the maturity structure of domestic debt instruments. Many developing countries are unable to issue long-term government instruments at reasonable interest rates, in turn issuing mainly short- and medium-term securities (0–9 years). As of 2022, Zambia and Kenya’s domestic debt portfolio comprised of 78.5 per cent and 77.8 per cent of short- and medium-term securities, respectively. The proportion was even higher in Ghana, where short- and medium-term securities accounted for approximately 89.8 per cent of marketable instruments at the end of 2022. This short-term maturity structure increases rollover risks, where governments continually borrow to settle maturing obligations, thus risking macroeconomic instability.

High domestic debt service burdens in some African countries weigh heavily on government finances, further reducing spending which could be directed to investments in critical sectors such as health, education, and infrastructure. Figure 5 compares domestic and external debt service payments in selected African countries in 2022. In this time period, in all the countries below, domestic debt service was higher than external debt service, despite domestic debt stock being lower than external debt stock. Mozambique, for instance, paid 5.5 per cent of GDP in service for domestic debt, which was a quarter of total debt stock, compared to 3.1 per cent of GDP for external debt which made up three quarters of the debt stock. Even more alarming, in 2022, Kenya, Uganda and Zambia spent lower on education than they did on domestic debt service, at approximately 4 per cent, 2.5 per cent and 3.5 per cent of GDP respectively.

In principle, policymakers could lower the cost of domestic debt servicing by inflating away the debt. In such cases, governments may adopt expansionary monetary policies to increase inflation thus effectively lowering the real value of its debt. While this might have some short-term benefits, in the long-term, high inflation may reduce investors’ confidence, increase cost of borrowing through an inflation-risk premium, and affect the long-term performance of the economy.

In some African countries, average real interest rates on domestic debt tend to be higher than nominal interest rate on external debt. This is, however, not always the case because of high inflation in many countries. According to the IMF, the projected average real interest rate on domestic debt for Ghana and Zambia over the period 2023–2032 will be lower than the nominal interest rate on external debt. Figure 6 shows the 10-year Government bond yield in selected countries, with Kenya and Nigeria above 18 per cent as of March 2024. This high yield spread, compared to the US 10-year Government bond yield at 4.21 per cent, illustrates the high-risk perception of many African sovereign debt instruments. Market sentiments, including preference of short-term maturities, as well as a narrow investor base, are some of the factors that could drive up the interest rate on domestic debt.

Implications of domestic debt restructuring on the financial sector and broader economy: Ghana’s experience Ghana’s debt default (external and domestic) and the subsequent restructuring has put the spotlight on domestic debt in Africa. The country’s public debt has steadily risen in the last decade, from 55.4 per cent of GDP in 2015 to 76.6 per cent in 2021. This trend was driven by Ghana’s access to the international financial markets, having had 15 outstanding Eurobonds at end-2022. In the same time period, domestic debt grew from 22.4 per cent of GDP to approximately 39.6 per cent of GDP mainly because of government borrowing to finance the energy sector and to bail out the finance sector following the 2018–2019 financial crisis. The COVID-19 related expenditure also increased debt by approximately 4.6 per cent of GDP in 2020.

At the time of default in December 2022, total public debt stood at 92.3 per cent of GDP. Some of the factors contributing to the default included an inflated import bill due to effects of the war in Ukraine, drastic depreciation of the cedi and increased cost of debt service. At the same time, external shocks triggered significant capital outflows and diminished access to international financial markets. Moody’s and Fitch downgraded the country’s sovereign credit rating in September 2022, and foreign exchange reserves dwindled to 2.7 months of import cover at end-December 2022, down from 4.3 months at end-December 2021.

In December 2022 the Government initiated a domestic debt exchange programme, aimed at restoring sound public finance management and debt sustainability. Domestic bond holders were offered a chance to exchange their holdings with a fresh issuance of bonds with longer average maturities and lower coupon rates. New bonds were issued at a coupon rate staggered between 0 and 10 per cent. Before the exchange, interest rates for 2–6 years notes ranged between 21.5 per cent and 29.85 per cent. Although the programme managed to lower interest rates on government securities and lengthen their maturities, analysis by the country’s financial sector regulators showed that it adversely affected the solvency of some banks and insurance companies. The Government formed the Ghana Financial Stability Fund to minimize impacts of the restructuring process to the financial sector, and to avoid risks of a potential financial crisis. The IMF demanded satisfactory completion of the domestic debt exchange programme as a prerequisite for continued engagement with external creditors. The restructuring also took a relatively short time, with the domestic debt exchange programme concluding successfully in 2023. In January 2024, Ghana reached an agreement with official creditors under the G20 Common Framework on Debt Treatment.

Some lessons can be derived from Ghana’s experience with the domestic debt restructuring. These include the need to cushion the financial sector from adverse impacts of a domestic debt default. Importantly, countries should also focus on safeguarding vulnerable people by improving social protection in times of economic hardships. In 2023 Ghana doubled benefits distributed through the cash transfer programme targeting people living in poverty. The Government also increased allocations in the education and health sector. Through this experience, Ghana has maintained a growth momentum buttressed by sound financial and monetary policies aimed at restoring macroeconomic stability and debt sustainability. Inflation declined from 54.2 per cent in December 2022 to 23.2 per cent in February 2024. The economy also grew at an average of 2.8 per cent in the first three quarters of 2023, almost double the Government’s initial target of 1.5 per cent GDP growth. In January 2024, the IMF noted that “ambitious structural fiscal reforms are bolstering domestic revenues, improving spending efficiency, strengthening public financial and debt management, preserving financial sector stability, enhancing governance and transparency, and helping create an environment more conducive to private sector investment.”

How can African countries better access and manage their domestic debt?

Domestic debt is a valuable source of finance for African countries. However, it remains a potential source of vulnerability and the consequences of a default on domestic debt can quickly reverberate throughout the economy. The viability of domestic debt will continue to be challenged by short-term maturity preference, limited – or financial sector concentrated – investor base and high interest rates. If these challenges persist, governments will continue to struggle to meet debt repayment obligations and thus worsening debt sustainability.

African countries need to improve macroeconomic policies, debt management and regulatory frameworks to ensure long term sustainability of domestic debt. Firstly, a stable macroeconomic environment, especially a low and stable inflation rate, is necessary to build investor confidence and appetite in medium- and long-term government debt instruments. In addition, a broad investor base, including non-financial institutional investors is also required to reduce the risk of a private credit crunch caused by overexposure of financial institutions to government lending. This will also accelerate development of domestic bond markets, in turn improving resilience to global shocks by reducing reliance on external borrowing. Finally, and most importantly, proceeds from debt must be used productively – by investing in projects with high economic returns – to ensure governments’ ability to sustainably service their debt obligations.

Going forward, as African governments continue to seek an optimal debt structure, they will need to strengthen their debt sustainability frameworks to adequately balance the trade-offs associated with domestic debt. Lack of timely action on this will only exacerbate existing debt vulnerabilities, which could negate development progress and put the SDGs even further out of reach for countries most in need.

The Monthly Briefing on the World Economic Situation and Prospect is part of the monitoring and analysis activities of the Global Economic Monitoring Branch (GEMB) in the Economic Analysis and Policy Division (EAPD) of UN DESA. This issue was prepared by Nelly Rita Muriuki under the supervision of Hamid Rashid (Chief, GEMB) and general guidance of Shantanu Mukherjee (Director, EAPD).

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News from the Columbia Climate School

Sustainable Development Program Hosts Annual Alumni Career Conversations Panel

Lylia Saurel

Columbia Climate School

The Undergraduate Sustainable Development Program (SDEV) recently hosted its annual Alumni Career Conversations panel. Open to any and all undergraduate and graduate students interested in sustainable development career paths, the event facilitated exposure to various sectors and projects in the sustainability field and provided attendees with valuable insights.

The panel was composed of three alumni from SDEV: Chelsea Jean-Michel (CC ’19), Autumn Moore (CC ’22), Lauren Ritchie (CC ’22), with Hannah Friedman (CC ’19, SPS ’21) serving as moderator.

Jean-Michel, an associate on the wind team at BloombergNEF , specializes in strategic research covering global commodity markets and technologies driving the transition to a low-carbon economy. She manages a subscription-based platform and synthesizes trends within the wind industry, drawing on her previous experience as an energy, sustainability and infrastructure consultant.

Moore, an associate in climate data and technology at KPMG US , supports clients in enhancing their data and technology to achieve their environmental goals.

Ritchie is the founder of the Eco Justice Project , a digital platform dedicated to sharing the stories of underrepresented communities and promoting intersectional climate advocacy. She also co-hosts the society and pop-culture-centered podcast, Black Girl Blueprint , amplifying the perspectives of Gen-Z Black women. Ritchie has worked as a future rising senior fellow with Girl Rising , where she produced a short film.

Friedman is the founding principal of newly launched Planeteer Capital , a climate venture capital fund, where she provides strategic guidance to executives as they scale up their climate projects. Before this, she spent around four years investing in the circular economy at Closed Loop Partners, a multi-asset class investment firm.

The panel aimed to equip current students interested in sustainability with practical tools and information to build their professional portfolios and navigate job searches effectively. Panelists shared insights into how the skills acquired from the program have transferred into their work.

“The two most important skills I have developed during my time with the SDEV program were to present research effectively and learn how to talk about climate with different audiences,” Jean-Michel said.

Panelists also talked about the importance of extracurricular activities and both formal and informal networking events in shaping their career trajectories. They encouraged participants to engage in activities related to sustainable development, as well as more creative activities, such as soccer, acting and study abroad experiences, to cultivate transferable skills and a unique profile.

“I studied abroad in Iceland to learn more about renewable energy economics, and this experience greatly helped me become comfortable with public speaking,” Jean-Michel said.

After an overview of the latest trends in their respective industries and what a day in their lives might look like, the alumni shifted the discussion to the role of internships for professional and personal development. They shared recommendations on how to best approach these opportunities.

“My internship experiences, although not related to the work I currently do, were very useful in teaching me how to be articulate about a topic, which is very important in my role as a client-based consultant,” Moore said.

With its diverse panel and insightful discussions, the Alumni Career Conversations panel provided invaluable guidance and inspiration for students navigating the complex landscape of sustainable development careers. Sylvia Montijo , the SDEV program manager, expressed pride in the accomplishments of the alumni, highlighting the importance of inclusion in the field of sustainability.

“This annual event serves as a special platform to highlight the exceptional achievements of our alumni. The field of sustainability is incredibly diverse, evident in the many ways our panelists engage with this work. It’s crucial for the SDEV program to persist in centering these diverse voices and inclusive perspectives,” said Montijo.

Following structured discussions, participants had the opportunity to engage in open conversations with alumni, delving deeper into their transition from the SDEV program to their current roles. This segment fostered a safe and candid dialogue on the nuances of different careers within the sustainable development sphere.

“The thorn is that there needs to be more investment and funding going to the creative side of climate. The rose is that I feel I can make an impact at various levels, even with kids, and that’s promising for our future,” said Ritchie.

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