ABSTRACT

Purpose: The present paper examines the effects of the degree of internationalization and inward foreign direct investment on corporate social responsibility. Since corporate social responsibility leads to social legitimacy and corporate reputation, the author believe that both internationalization and inward foreign direct investment can affect the level of participation in corporate social responsibility. Composition: Using neo-institutional perspective, this paper expects that firms regard corporate social responsibility as the best practice when they go abroad for production expansion. Likewise, because foreign investors want to gain the established legitimacy easily, it seems that inward foreign direct investment prefers to socially responsible companies.. Findings: Using Korean Workplace Panel Survey, the current paper tested the hypotheses. As expect, the association between the degree of internationalization and corporate social responsibility is positively related. This result shows that internationalization of firm lead to higher responsibility for society. However, unlike expect, the positive link between inward foreign direct investment and corporate social responsibility is not supported. Originality/Value: Despite of increasing concern about corporate social responsibility, the result demonstrates that foreign direct investment does not contribute to responsibility for the various stake-holders. This is why that foreign direct investment may seek to short-term financial performance in the stock market or government policies are generous to foreign investors beyond social norms.

KEYWORD

Degree of Internationalization, Inward Foreign Direct Investment, Corporate Social responsibility, Neo-institutional Perspective

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