The purpose of this study was to identify the key stakeholder groups pressuring the Multinational Enterprises (MNE) in Emerging Markets and Developing Countries (EMDC) to develop Corporate Social Responsibility (CSR) strategies. Drawn on the Stakeholder Theory and the Institutional Theory, all the stakeholder groups acknowledged and analysed in the literature were identified and examined in this study to understand if they were perceived by the MNE in China as effective in pressuring them to engage in CSR strategies and activities.Design
The study was conducted through analysing the responses of 150 people responsible for CSR development and implementation of MNE’ Chinese subsidiaries, using Partial Least Square - Structural Equation Modelling (PLS-SEM). Findings
The results of this study, primarily demonstrated that in China only stakeholder groups with a power - government power or voting power - are perceived as to have enough pressure to make MNE’ Chinese subsidiaries engage in CSR. Through the analyses of the results of this study and the extended literature review, an extension on the concept of utilitarian power and political power when analysing stakeholder salience in EMDC is proposed.Research limitation/Implications
First, it is recognized that the sample of this study can be arguably small (155 surveys). Another limitation is that the research is based on a unique part of China, the Shanghai province, and future research should test this model in diverse provinces. Additionally, China has special characteristics that can be disputably different from most of the EMDC; e.g. size, political system, growth rates, etc.; Another limitation of this study is when the author developed the survey for this research, the author did not plan in advance to use the PLS method; therefore, the survey did not include a question that would allow the statistical analysis of the convergent validity following Hair et al. (2017) recommendations. Finally, analysing the present results, the author also realizes that if the questionnaire had more specific items related to government and economic power, the results could be more complete.
The findings of this study also have implications for managers of MNE subsidiaries developing business in EMDC, helping them to identify who are the key stakeholders in those countries taking in consideration their level of government power. Additional, the results also provide to Managers clarifications on which type of CSR activities the MNE subsidiaries’ stakeholder groups have.Keywords
Corporate Social Responsibility, Stakeholder Salience, Emerging Markets and Developing Countries, Political power and MNE.