Multinational corporations and corporate social responsibility in transition economies

Abstract

Many multinational enterprises have had tough experiences in learning the importance of being socially responsible. Multinational enterprises are now finally, regarding high standards of corporate behaviour as the key to success in the international market. For example, Oil company Shell lost business and declined in value due to two high profile corporate incidents in 1995. Since then, Shell has been dedicated to managing its social responsibilities as a strategic priority, aiming to build up the company’s reputation, to protect its market share and to operate in a way which satisfies all of its stakeholders (McIntosh et al, 1998). There are two major objectives of this paper: (1) to answer two critical questions in relation to corporate social responsibility: (a) what is the external dimension of corporate social responsibility for multi-national enterprises in transition economies? (b) What are the consequences for multinational enterprises if they ignore the interests of their stakeholders in the transition economies? And (2) to point out the marketing paradigms with a social responsibility focus for transition economies.