Introduction: The International Framework

World economy transformation, globalization, and gradual creation of a new model of global management replace the old values based on the profit approach with socially important projects; hence, only socially-responsible companies can be efficient in the world market. Increase of the importance of non-material factors of economic growth forces most companies to improve innovation processes and to launch new technologies which combine the human, intellectual, emotional, and social capital. All mentioned above sets the economic imperatives of business socialization.

Social phenomenon of business takes its roots in the second half of the twentieth century in the USA and countries of Western Europe. By today each country has developed some cultural prominent features. The Russian model of CSR (among other emerging markets) is still under construction. The author considers business and social relations, sustainable development of corporations as defining conditions of global corporate development comprising corporate governance system and a model of social responsibility of business.

Relations Between Social Responsibility and Business Policy

Although corporate responsibility code often developed by the companies and, frequently, supervised by the non-governmental organizations, at the present stage the national governments play an essential role in this process. The governments encourage necessary activities and provide legislative framework to guide the responsible behaviour of business. Thereupon the principles of corporate social responsibility must be considered exclusively as a part a corporate development system.

Academia research and business estimation underline one important fact—introduction of ethicalFootnote 1 methods of business is essential. A major factor, standing up for increase of corporate responsibility, is the necessity to involve and keep the highly skilled personnel for maintenance and further development of the business (Fig. 1).

Fig. 1
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Corporate responsibility stimulus (international business research by Grant Tornton 2008)

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The public attention is mostly aimed at the large transnational corporations’ cases and ethics of its business operations; at the same time small and medium-sized businesses are expected to keep the same principles. The specifics of the capitalist development of the western countries had been always a continuous and ongoing process that ended up with a complex, but balanced system of regulation of mutual relations of the businesses’ and the society’s power in the sphere of social and economic development of the countries. Nowadays in different countries participation of businesses in the social problem-solving is motivated by tailor-made stimuli and privileges, and also strictly regulated by the commercial, tax, labor, ecological legislation.

A result of such development of the western countries is well-regulated system of mutual relations of private businesses, government and civil society in the social and economic sphere. National models of social partnership match national models of the Social State.Footnote 2 The concept of social partnership is fixed in constitutions, social and labor law of the western countries (Belyaeva 2010). Using traditional models of social partnership, one can understand more deeply the genesis of models of socially responsible businesses in the global regions of the world (Matten and Moon 2008).

(Corporate) Social Responsibility Through Lens of Theory

According to some sources cultures, structures, and routines operating at multiple levels of jurisdiction carry institutions’ impact over firms (Scott 2000). Institutional theorists thus argue that corporate governance system will be determined largely by prevailing institutionalized norms in the organizational field and society.

The other theoretical perspective on corporate governance is a sociological perspective that builds on resource-dependence theory—specifically, the influence of social networks on board formation and composition (Pfeffer 1997). Fundamental to this perspective is the notion that a firm’s actions are embedded in social networks, which refers to the extent that actions are informed, influenced, and enabled by the network of accumulated stable and preferential social relations (Granovetter 1985).

The Freeman stakeholder theory of corporate governance system adopts a pluralistic approach to organizations. Stakeholders have much more than just a passing interest in an organization’s outcomes. They also actively attempt to affect an organization’s behaviors in order to influence its direction so that it consistently meets their needs and priorities.

Comparative analysis of some approaches regarding maintenance and borders displays the forms of social responsibility of businesses and allows us to allocate some basic approaches (Table 1).

Table 1 Approaches to the essence of the corporate social responsibility
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The table above lacks Russian fundamental input in the evolution of corporate social responsibility theory. Generally this trend is based on the poor practice of socially responsible strategy in Russia. The major part of Russian-based research is limited by historical aspects of CSR, reviews of the western cases, and also attempts to tailor these experiences to Russian companies, although these trends are mostly based on the internationally set models (e.g. Belyaeva and Eskindarov 2008). A few papers are devoted to the correlation between corporate social and financial performance (e.g. Blagov 2011). There were several attempts to research nation-wide trends of corporate social performance in Russia. Based on the analysis of the leading Russian companies’ best practices Blagov concluded that their CSR related activities tended to be in line with the global trend of CSR principles integration into corporate strategy.

Some working principles of social responsibility were suggested to outline Russian coherent business development (Kostin 2007): reduction of negative business influences upon key stakeholders, adding value to social and economic development by investing the key projects for both shareholders and other interested parties; confidential relations with stakeholders based on the transparency and openness according to the corporate behavior code; aiming at officially high financial results.

Although the topic of social responsibility is becoming more and more important for Russian businesses and other groups of stakeholders, the global understanding of the issue, its positive and negative effects are not clear to major players. We propose to map the Russian specifics on the world social responsibility field in order to work out strategically important paces to integrate into the global changing sustainable business environment.

The Russian Practice: Link Between Corporate Development and Social Responsibility

The analysis of the world-wide practice allows allocating some types of CSR that vary depending on orientation vector of programs and state participation. In our opinion, all these features have made essential impact on formation of the Russian model of corporate social responsibility.

In Russia, this process is standing in its initial stages of the state’s dominant positions, extremely poor development of institutions of the civil society, and oligarchic development of businesses. Thus, rules of institutional cooperation, roles of different parties and levels of their participation in the social development are only to be formed.

The term «corporate development» has appeared in the Russian academic sources in the middle 1990s; questions of efficiency of the given approach and corresponding tools are still under deep discussion in the local business environment. Social responsibility of the Russian businesses takes sources in aimless philanthropy of 1990s’, and in the western understanding it has only started its development in 2001–2003.

At the same time Russia was included into the BRICS group considering a common perspective on economic and political growth. Although BRICS countries are geographically and ideologically apart, there are new mechanisms to integrate them into the world economic culture (Canen et al. 2009). The desire of the BRICS companies to enter in the international market and to become worthy participants in the world economy makes them search for effective mechanisms of managing CSR as a strategic part of business policy.

Unlike the companies working in the developed markets, the companies in the BRICS countries consider CSR as a business dealing part, a tool to increase their competitiveness, a possibility to enter new commodity markets, and also to strengthen mutual relations with suppliers, investors, and buyers. CSR is not only a tool of the social problems management in the region. The pragmatism and economic benefit expectation force the companies to put huge investments into social and ecological spheres (Belyaeva and Canen 2011).

In sense of the freedom of economic culture of stakeholders the situation has a cyclic character. For example the situation in corporate governance area in Russia up to 2004 correlates with the situation in America in the fifties. Thus, general meeting of the shareholders was purposely discharged from the company’s activity, board of directors played a passive role, and the governance was duty of the head of the company.

Considering the level of social and economic transformations in Russia, the 2000–2001 period of time was the correct moment to begin an institutionalization of corporate development and social responsibility in Russia. Now the leading part in working out the standards of corporate governance system is played by regulating authorities that have begun an extensive educational campaign through specially developed principles of appropriate practice in Russia. After the last economic crisis in 2009–2010 the government shared a big pie of the corporate regulations and management. So to say the Russian companies have an invisible, but tough, hand again.Footnote 3

Still in Russia the central player in the general and corporate governance is the manager-insider, who builds a determined control system of business. His or her commitments and overall objectives are to increase the business potential. At the same time the manager is linked with the owner, following his or her interests, where the major motive is the growth of the business market value and return on the invested capital. The ROI is the basic criterion of an overall performance of business for the owner. The classic agency conflict of interests is an important element of the national business environment in Russia.

The organizational culture of a corporation of the technocratic type and the dominating style of management were based on decision-making control. A traditional approach considers an economic organization as the “closed” system, its purposes and commitment are considered agreed and stable, as well as other conditions of activity, stable enough for a long time, and the sense of duty and an effective control have crucial importance in management techniques. One of the lines of the social and economic transformation in frames of corporate development in Russia is the socially-responsible approach of business to corporate relations without dependence on obligatory and voluntary motives.

As it is foreseen in the west, publication of annual social reports is called to demonstrate transparency of large companies, and social responsibility ratings would help to stimulate competitiveness of business. An analysis of 188 social reports of Russian companies, of which 99 % are owned by large companies and financial institutions, showed no interest in the development of social responsibility of medium-sized businesses. The empirical base includes database of financial and non-financial reporting of The Russian Union of Industrialists and Entrepreneurs, “Russian Trading System” Stock Exchange archive. Figure 2 illustrates economic sectors showing social business activity in Russia, according to the materials studied (reports).

Fig. 2
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Socially responsible initiative by Russian businesses. Calculated by the author based on the statistical and information and corporate reporting information

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According to the research of Association of Managers Russian CSR practice is still mostly an obligation or PR initiative (Blagov et al. 2008, 2009; Litovchenko 2011).

An enterprise’s core values influence its selection of strategic goals and decisions on how the enterprise will negotiate and carry out its explicit and implicit contracts with stakeholders. Finally, the strategy identifies which stakeholders are important to the enterprise’s success and why. Stakeholders may be important because they contribute to profitability, because corporate management and the board feel a sense of social responsibility to the stakeholder group, because the corporation is legally obliged to participate in that stakeholder group. The final major element also refers to the research of social relations—cultural context, which introduces to the model of corporate governance a process concerning shared values and possibility of their adoption in the whole enterprise. We follow the Porter and Kramer’s (2006) CSR typology: “responsive CSR” and “Strategic CSR” and also Halme and Laurila (2009), hence we suggest a system of the CSR elements and their integration into different types of strategy (Fig. 3).

Fig. 3
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System of the CSR elements

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Accordingly some features of corporate development of a business environment of the Russian companies are systematized in Table 2.

Table 2 Stages of corporate development in the context of corporate governance (CG) and social responsibility trends (CSR)
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Despite some listed above positive trends at present time there are four common models of social behavior of businesses in Russia. They include urban development enterprises that specify lifestyle of the territory; voluntary and compulsory charity; special bargain conditions of large business; and model of social partnership is less common than the three mentioned before.

Some Current Open Issues Concerning Corporate Social Responsibility in Russia

The fundamental issue of social and economic transformations is related to the Russian economic culture integration into the world corporate development. Social responsibility varies at different levels of social and business systems. As it is already noted above, many researchers mark necessity of stronger contribution of board to development of corporate responsibility and building the corresponding corporate culture.

The corporate culture is helpful in understanding different symbols and activities; therefore it enables the stakeholders to find the most suitable solution. Ethics control enables determining how the decisions are taken to support an increase of long-term value in an enterprise, and how they correspond to justice requirements regarding resource distribution.

Communication between leadership and socially responsible business development characterizes some peculiarities of Russian model of corporate social responsibility. High value of leadership in a control system routes in the Soviet understanding of leader as the head; accordingly, leadership in realization of corporate social responsibility can be considered as a technique of efficiency-increase of the company. The strategy based on leadership demands a wide use of their resources and the coordinated work of their followers/subordinates, which is the western characteristic of leadership.

The corporations with leadership management type in Russia most successfully form the internal business processes, and also relations with their external business environment; for this reason they can be considered as socially responsible. The phenomenon of leadership in a corporation and in frames of the corporate relations system is the mechanism that uses innovative approaches through potential of the higher degree in inventing the organizational, social and economic superiority over competitors. It might be the main result of transformation of corporate social development.

Russia has a possibility to take lessons from foreign experience. So, achievement of the new “social contract” between the state, business community, and civil society is open for Russians as well. Certainly, each country has her features of unique development, tradition, national interests. But in the context of globalization all members of world economy need to solve similar problems related to the interests of individuals, protection of their advantage, living and working conditions, social protection. World models of corporate social responsibility form both the social architecture of the Russian business, and the variants of its development that match the calls of the twenty-first century.

Some Possible International Lessons for the Russian Model of Social Responsibility

The analysis of world practice allows for allocating some types of corporate social responsibility that vary depending on orientation vectors of programs and state participation. In our opinion, all these features have made essential impact on formation of the Russian CSR model. Though, there are still many academic disputes on it and on the national model of corporate governance.

The institutional contour of the built Russian CSR model should consider essential types of ideological, economic, political and the public work, directed to harmonization of the balance of stakeholders’ interests. The borrowed and unique lines of the Russian model are starting to take a steady form (Belyaeva 2010). Taking into account well known features of world models of social responsibility,Footnote 4 based on different vectors of the integrated triple approach (economic, ecological and social), we suggest that the Russian national model comprise adopted and also unique features (see Table 3).

Table 3 Peculiarities of Russian social responsibility model
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Mapping Russian Corporate Social Responsibility Model in the World Economy

While the author attempts to generalize all the factors making for building an innovative CSR business model in Russia, the requested model is that the national economy needs to improve the investment attractiveness. Since Russia is still compared to other BRIC economy it is logical to find correlation of the Russian model of CSR and BRIC countries.

To study the CSR profile we choose a list of basic descriptors. The method allows making a list of criteria of the research object (or polygon comparative characteristics)—selected characteristics (lines) are represented graphically in the form of vectors of the polygon. Profile is the sum of characteristics, in our case—the sum of the characteristics of corporate social responsibility models. Imposing polygons on each other, we can see similarities. Given the results of comparative analysis the following 17 characteristics reflecting some specific lines of CSR were chosen. Further, the models of CSR in the BRIC countries were compared based on these characteristics by using the list of criteria in order to identify similarities and differences between these models. Parameter estimation was based on the preceding analysis. The greatest number of matches found in the features of models between Brazil and India, and the lowest—between India and Russia (Fig. 4).

Fig. 4
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CSR models match in BRIC countries

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Despite the big similarity, Brazil, India, and China stand at different steps of CSR implementation. At present Brazil seems to be the leader in introduction of CSR principles. In the BRICS countries along with « the advanced » socially responsible group of companies there is a negatively minded group of businessmen and local residents. On the one hand, many companies in India and China consider CSR as the unnecessary western concept, on the other hand—as a trading barrier. CSR is not only the tool of the social problems management in the region. The companies in the BRICS countries consider CSR as a businesses’ dealing’s part, the tool to increase of competitiveness of the company, possibility to enter new markets, and also to strengthen mutual relations with suppliers, investors, and buyers. The pragmatism and economic benefit expectation force the companies to put huge investments into social and ecological spheres.

Conclusions

Latest publications suggest Russia to follow the world trend of “socialization” of business. One can also find methods of struggle against those businessmen refuse to follow the given trend. Unfortunately the majority of the Russian companies is quite far from the universal trends and is forced to struggle daily to survive here and now.

Observance of the certain specification in the field of CSR can be a necessary condition for corporate membership in any branch association. The specifics of the Russian CSR include its basic initiator–the State (instead of a society or business acts). The concept of social and economic development of Russia declares an intention to build the mechanisms promoting strengthening of social responsibility of business and distribution of the corporate social reporting. Corporate social activity in Russian business is still often associated with PR and remains isolated in the relevant departments. Consequently, the public at large is only fed limited, and favourable, information rather than the true picture of corporate social activity with all its natural perplexities and problems. In general this situation unfortunately reduces the CSR role in Russia to a ‘cosmetic’ rather than a strategic one.

The dynamics of the current stage of corporate development in a context of increasing corporate social responsibility gives a good possibility to the Russian business community to raise the level of economic culture and to integrate national corporations into the world map of social responsibility. It might become a key-driver to generate positive investment and corporate climate in Russia.