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  1. 1. Cultural Leadership& Predictors of CSRWaldman et. Al 2006
  2. 2. IntroductionCollectivismCEOVisionaryLeadership& IntegrityCSRPREDICTORSCulturalvaluesshape firmvaluesPowerDistanceCSR:- Actions on the part of the firmthat further the needs or goals of anidentifiable stakeholder group, or alarger social collective (McWilliams& Siegel, 2001)Beyond legal requirementsValues shape actions3 Dimensions of Managerial Valueo Shareholder/ Ownero Stakeholder Relationso Community/State Welfare
  3. 3. Methodology Form associations between CSR Decision-Making Valuesand 3 dimensions of societal-level culture:Institutional-level collectivismIn-group CollectivismPower Distance 15 countries, 40 firms each, across industries (not stratified) GLOBE RESEARCH PROGRAM Multiple Survey & Respondent Approach Didn’t measure actual CSR actions or performanceAustriaBrazilChinaGermanyGreeceGuatemalaIndiaMexicoThe NetherlandsNigeriaRussiaSloveniaSpainTaiwanTurkey
  4. 4. Findings2. CSR IS A MULTI-DIMENSIONAL CONSTRUCTConsisting of concern for:shareholders, stakeholders & community.Each predicted differently by variables.Previously there was a lack of clarity about dimensionality & depth
  5. 5. Findings3. POWER DISTANCEHIGH  Manager’s value all 3branches of CSR lessManipulative use of powerOn the part of managers withoutconcern for either of the 3(Carl et al, 2004)Cause for concern for proponents ofglobal CSRStakeholder management is relevantto profitability (Hillman and Keim, 2001)firms in such context may be at adisadvantage in the global economy
  6. 6. Findings5. ORGANISATIONAL LEVELVARIABLESVISIONARY LEADERSHIP & INTEGRITYCan account for variables in managerialvalues with regard to CSRMay be a driver of how subordinatemanagers view CSRMore related to Shareholder andStakeholder CSRCONCLUSIONDemographic, Cultural and Leadership factors are critical determinants ofthe CSR values of managers. International firms should assess suchvariables for managers in different countries.Leadership can help align decision making across borders, despite culture4. COLLECTIVISMCOLLECTIVIST CULTUREmanagers value more aspects of CSRSuch cultures encourage delaying immediateneeds or gratification for future concerns.INSTITUTIONAL COLLECTIVISMSignificant relationships with all 3 dimensionsIN-GROUP COLLECTIVISMNo significant relationships with any dimension
  7. 7. Waldmanintoday’ssocietyCONCLUSION 1: GDP INFLUENCES CSROccupy Wall StreetOccupy Together communitiesmobilized to protest corporategreed“to change current monetarypolicies to help the 99% of thepopulation, instead of just the elite1% that they currently benefit”Top 1% of earners earn 23.5% ofGDPSouth Africa"Leveraging Local Savings forLocal Development,” –Financial ServicesCooperativeAl Baraka Bank: Iqraa Trust in1994. Humanitarianorganization. Focuses oneducation, training, skills,development & health careand is active in all provinces.
  8. 8. Waldmanintoday’ssocietyPOWER DISTANCE IMPACT ON CSRSierra Leone: PDI: 77Human Rights abuses of minersInfo relating to miningagreements between thegovernment and naturalresource extraction companieswas kept at the ministry ofmines on documents that wereneither secure nor accurate.Profits used to fund civil warAustralia: PDI 36“NICE ICE”North Australian DiamondsCo. LtdKimberly ProjectConservation projects, howto best extract the diamonds:Shareholder profitability andenvironmental concernBest practicerecommendationsembodied in 10 corporategovernance principals whichhave been broadly adoptedby the ASXMININGINDUSTRYDIFFERENTIALS
  9. 9. Waldmanintoday’ssocietyCONCLUSION 5: ORGANISATIONAL LEVEL VARIABLES(VISIONARY LEADERSHIP& INTEGRITY AMONGST CEOs)Domiciled in the USA- largest GDPin the worldTop management tendency todisregard Societal Level CSR indecision makingYet the visionary leadership ofHoward Schultz has the companyinvolved in many Societal LevelCSR activitiesOpportunity Finance NetworkEthical SourcingEnvironmental StewardshipCommunity involvement
  10. 10. Personal Takeaways