Epsilon Archive for Student Projects

Abstract

Today, the society is demanding from the industries to perform Corporate Social Responsibility (CSR) activities and show their responsibility by contributing and developing sustainable businesses. Especially for the agribusinesses in the Republic of Macedonia (RM), linked with many scandals concerning food and beverage production, it is crucial to work strategically with CSR, for example, by using ethical guidelines, such as codes of conduct (CoC). Stakeholders want to be sure that companies using ethical CoC are accountable, showing concerns for their employees and providing safety at work, avoiding corruption, and protecting the environment. These codes represent corporate efforts of the companies to communicate proactively and properly in order to show their accountability and gain legitimacy and reputation among key stakeholders.

The aim of this study is to describe how companies create incentives for promoting responsible leadership through a stakeholder and legitimacy theory in practice, and how the CoC are used as a tool for sustainable businesses development. A literature review that leads to the development of a conceptual framework is introduced. It offers a framework for interpreting determinants of the CSR, CoC and their effects on the companies particularly on the legitimacy, reputation and the real performance of the companies in agribusiness. The theoretical approach and empirical study are used in order to give us deeper analysis of the CoC and CSR practices within companies and the way how they are communicated with the relevant stakeholders.

The surveyed companies in this project are three Macedonian food companies, which can be said to be among the few companies with implemented CoC and CSR practices in RM. The implementation of CSR practices and development of CoC presupposes awareness of the importance of social and environmental values on the part of the CEO and the management team. A reason for studying these corporate efforts is willingness to share the perceived experiences and relevant documents regarding CSR and CoC. A mixed method has been used for the project, meaning that internal and external documents, web pages and personal interviews serve as methods for accessing data. With a view to describing the incentives for promotion of the CSR activities and the CoC within companies, the respective documents have been compared with the case findings.
The conducted study represents the current situation with the implementation of the CSR concept in RM. The Government of RM has constituted a Coordinative Body for CSR in RM, and has developed a National Agenda for CSR Development in RM. The key for undertaking corporate responsibility initiatives for food companies in RM is associated with conceptualizing the role and importance of food industry in the country. Key factors are identified as explanatory in the search for legitimacy associated with corporate responsibility. These factors are related to institutional facts, corporate type (ownership and size) and management (structure, culture, leadership, style and communication efforts). The results from the conducted study differ depending on the type of the company, ownership, and business approach of the management team. The findings from the case studies substantiate the notion that in some cases small enterprises sometimes show more transparency and proficiency for the CSR concept than larger companies which, in their organizational structure, have implemented a separate department for human resource management which is responsible for conducting these activities (UNDP Baseline study, 2007, p. 35).