Corporate social responsibility and sustainable competitive advantage: A case study of the cement industry

Abstract

At the beginning of the twenty first century, there was an ongoing debate concerning the role of corporate social responsibility (CSR) in achieving sustainable competitive advantage (SCA). While external stakeholders required corporations to balance economic, social and environmental dimensions, research indicated a considerable gap about how CSR initiatives could be used to contribute to the community and the corporation’s SCA. The specific problem that was addressed in this study is how CSR initiatives can be used to contribute to the community in the form of sustainable development and the corporation’s SCA. The purpose of this qualitative study, utilizing a single embedded descriptive case study research design, was to achieve a deeper understanding on how CSR initiatives are planned, aligned and implemented in large MNCs in the cement industry and how these initiatives may contribute to the community in the form of sustainable development and the corporation’s SCA. The study used stakeholder theory as the theoretical framework and was based on semi-structured interviews with 24 participants: six executive managers from three MNCs in the cement industry and 18 employed community inhabitants in the areas corresponding to three study corporations. Corporations and participants were purposively selected. The study findings clearly indicated that the strategic approach to CSR (i.e., aligning the corporation goals with the goals of the community) may balance economic value creation with the expectations of local communities. These findings revealed that corporate leaders may likely develop “mutually beneficial” relationships with potential stakeholders. As a result, the corporation can improve reputation and access to finance, capital, market and resources, as well as reduce operational risks and attract better employees. On the other hand, the community can get safe and affordable products and services, access to better job offerings, clean environment and a better quality of life. Understanding how CSR initiatives are planned, aligned and implemented in large MNCs in the cement industry may positively impact the community and the corporation’s SCA. Future research was recommended to explore the elements of organizational culture (i.e., values and beliefs) that affect the sustainable management practices of large MNCs.