Organizational structure as a factor of development of corporate social responsibility in Romanian companies

Abstract

The role of corporate social responsibility for the development of fundamental basis of social-economic interaction on sustainable development basis is significant for the existing corporate relations in the global economy. Corporate social responsibility means a voluntary initiative of separate corporations to implement a system social policy in the interests of society in general through the implementation of socially significant obligations established by laws, ethical standards, adopted rules of behaviour. In this regard the importance to study the corporate social responsibility phenomenon is that corporations with their socially significant behaviour predetermine social values in society in general and determine the vector of its socio-economic development. Considering the fact that the system of corporate social responsibility is based on labour relations incorporated into social-economic mechanism of a corporation and the mechanism in its turn is based on a company’s organizational structure the impact of an organizational structure on the corporate social responsibility practice is investigated in the research. The purpose of the article is to assess the impact of organizational structures of a company on the development of the systems of corporate social responsibility and to reveal differences in the corporate social responsibility systems of companies with different types of organizational structures. To achieve the aim of the study a theoretical review of approaches to understanding the essence of organizational structures and models of corporate social responsibility has been made. To analyse organizational structures we have used a synthetic approach that differentiates the structures into two types: mechanistic (with a high level of hierarchy and division of labour) and organic (flexible and better adapted to the rapid change of external conditions, including the emergence of new technologies). The hypothesis of the research is the assumption that companies with organic organizational structures are more progressive in the development of corporate social responsibility systems and the introduction of the principles of corporate social responsibility into their business practices. The study is based on social and ecological reports of Romanian companies that have more than 249 employees. The case-study method, interviewing, the tools of economic-mathematical analysis of data have been used in the research. While analyzing the contemporary status of the corporate social responsibility in Romania and 87 results of the questioning of the representatives of the Romanian companies we have come to the conclusion that despite the type of the organizational structure the key factors of the development of the system of corporate social structure are a company image and its reputation at the market, practice of purchasing (e.g. the compliance of the ethical code of a company by business partners and suppliers), the assessment of human rights in the company by business partners and industry trends of sustainable development. At that, the hypothesis that companies with mechanistic and organic organizational structures differently assess the role of the factors of corporate social responsibility. Thus, for companies with mechanistic organizational structures, image and reputation at the market, assessment of human rights by business partners, procurement practices, motivation and competence of personnel, and the absence of discrimination in remuneration of men and women are of fundamental importance in the development of corporate social responsibility systems. Companies with the organic type of organizational structure significantly appreciate the image and reputation at the market, as well as the level of internationalization of a company, the use of ECO labels, industry trends of sustainable development and production efficiency. As regards the advantages of the introduction of corporate social responsibility principles in the activities of companies, we have discovered that the differences are mainly observed in the average estimates of the analyzed factors in favour of companies with organic organizational structures. Results obtained in the investigation allow us to construct a profile of corporate social responsibility of companies with different types of organizational structures, to identify the advantages of the development of the system of corporate social responsibility and to make strategic priorities of socially oriented activity of a company more detailed. And further studies will be devoted to this aspect.

Keywords

corporate social responsibility, organizational structure, organic organizational structure, mechanistic organizational structure, factors of development of corporate social responsibility, sustainable development, efficiency

For citation

Crisan-Mitra C.S. Organizational structure as a factor of development of corporate social responsibility in Romanian companies. Perm University Herald. Economy, 2019, vol. 14, no. 1, pp. 145–159. DOI 10.17072/1994-9960-2019-1-145-159

References

1. Idemudia U. Corporate social responsibility and developing countries: Moving the critical CSR research agenda in Africa forward // Progress in Development Studies. 2011. Vol. 11, Iss. 1. P. 1–18.
2. Burns T., Stalker G.M. The Management of innovation. London: Tavistock Publ., 1962. 269 p.
3. Weick K.E., Browning L.D. Argument and narration in organizational communication // Journal of Management. 1986. Vol. 12, Iss. 2. P. 243–259.
4. Morand D.A. The role of behavioural formality and informality in the enactment of bureaucratic versus organic organizations // Academy of Management Review. 1995. Vol. 20, № 4. P. 831–872.
5. Blau J.R., Alba R.D. Empowering nets of participation // Administrative Science Quaterly. 1982. Vol. 27, № 3. P. 363–379.
6. Poza E.J, Markus L. Success story: The team approach to work restructuring // Organizational Dynamics. 1980. Vol. 3. P. 3–25.
7. Manz C.C., Sims H.P. Leading self-managed groups: A conceptual analyses of a paradox // Economic and Industrial Democracy. 1986. Vol. 7, Iss. 2. P. 141–165.
8. Walton R.E., Schlesinger L.A. Do supervisors thrive in participative work systems? // Organizational Dynamics. 1979. Vol. 7, № 3. P. 24–38.
9. Albers S., Wohlgezogen F., Zajac E.J. Strategic alliance structures: An organization design perspective // Journal of Management. 2016. Vol. 42, № 3. P. 582–614. doi: 10.1177/0149206313488209.
10. Young-Hyman T. Cooperating without co-laboring: How formal organizational power moderates cross-functional interaction in project teams // Administrative Science Quarterly. 2017. Vol. 62, Iss. 1. P. 179–214.
11. Perez-Valls M., Cespedes-Lorente J., Martınez-del-Rıo J., Antolın-Lopez R. How organizational structure affects ecological responsiveness // Business and Society. 2017. P. 1–37. doi: 10.1177/0007650317696313.
12. Iamandi I.E. The application of corporate social responsibility models in Romania in the context of the post-accession to the European Union // Economy Transdisciplinary Cognition. 2011. Vol. 14, Iss. 1. P. 27–34.
13. Crisan-Mitra C., Borza A. How measuring CSR performance impacts CSR results // Interdisciplinary Management Research. 2015. Vol. 11. P. 869–879.
14. Popa R.A. The corporate social responsibility practices in the context of sustainable development. The case of Romania // Procedia Economics and Finance. 2015. Vol. 23. P. 1279–1285. doi: 10.1016/S2212-5671(15)00395-0.
15. Jamali D. Neville B. Convergence versus divergence of CSR in developing countries: An embedded multi-layered institutional lens // Journal of Business Ethics. 2011. Vol. 102, Iss. 4. P. 599–621.
16. Dobrescu D., Vintilă G. Analysis of environmental corporate social responsibility – Romania in globalization context // Journal of Environmental Protection and Ecology. 2014. Vol. 15, № 4. P. 1660–1670.
17. Lut D.M. Corporate social responsibility policy within the Romanian west region companies // Quaestus. 2015. № 7. P. 9–18.
18. Brad L., Dobre F., Ţurlea C., Brasoveani I.V. The impact of IFRS adoption in Romania upon the earnings management of the Bucharest Stock exchange entities // Procedia Economics and Finance. 2014. Vol. 15. P. 871–876. doi: 10.1016/S2212-5671(14)00550-4.
19. Gherghina S.C., Vintilă G. Exploring the impact of corporate social responsibility policies on firm value: The case of listed companies in Romania // Economics and Sociology. 2016. Vol. 9, № 1. P. 23–42. doi: 10.14254/2071-789X.2016/9-1/2.
20. Dumitrescu D., Simionescu L. Corporate social responsibility (CSR) and company financial performance: Empirical evidence from listed companies in Romania // Entrepreneurship, Business and Economics. 2016. Vol. 2. P. 677–689.
21. Crişan-Mitra C., Borza A. Approaching CSR in Romania: An empirical analysis // Procedia-Social and Behavioral Sciences. 2015. Vol. 207. P. 546–552. doi: 10.1016/j.sbspro.2015.10.125.
22. Serban A.D. CSR as Corporate power. A communication view Facebook approach: An exploratory study // Management Dynamics in the Knowledge Economy. 2016. Vol. 4, № 1. P. 31–61.
23. Moisescu O.I. Demographics-based differences in the relationship between perceived CSR and customer loyalty in the dairy products market // Management and Marketing. 2015. Vol. 10, Iss. 2. P. 118–131.
24. Crisan-Mitra C., Dinu V., Postelnicu C., Dabija D.C. Corporate practice of sustainable development on an emerging market // Transformations in Business and Economics. 2016. Vol. 15 (1). P. 228–243.
25. Stoian C., Zaharia R.M. CSR development in post-communist economies: Employees’ expectations regarding corporate socially responsible behaviour – the case of Romania // Business Ethics: A European Review. 2012. Vol. 21, Iss. 4. P. 380–401.
26. Grigore G.F., Stancu A. The role of corporate social responsibility in building employer’s brand. Transformation in Business and Economics, 2011, Vol. 10, № 2B (23B). P. 741–753.

Show full text