Corporate Social Responsibility and Business Value of Multinational Companies: Lessons from a Sub-Saharan African Environment

ABSTRACT

The issue of corporate social responsibility (CSR) as an approach for businesses to independently take actions that lead to better levels of societal development as well as higher value creation for the business, particularly in developing countries has gained much advocacy. Thus, the purpose of this study is to examine the relationship between CSR and business value of multinational companies (MNCs) in sub-Saharan Africa. The study adopted quantitative research methodology and using multiple regression analysis, findings show that CSR can positively and significantly predict business values in the multinational subsidiaries. These values include direct (economic value) and indirect (human capital value and reputational business value). This paper therefore contributes to a novel CSR index from the perspective of business value and sustainability of MNCs in the Sub-Saharan Africa (SSA) environment. Thus, the paper recommends MNCs operating in Africa to enhance their social investment through their CSR strategy with the aim that CSR must not be regarded as a cost center, but an investment instrument that can accrue various dividends.     

论我国烟草税收政策的选择

对烟草及其制品课税有利于倡导健康卫生的生活方式,增加政府财政收入。国际经验也证明,提高烟草税收税负水平是减少各阶层人群烟草消费的有效和重要措施。目前中国烟草税收政策调控的重点在于烟草生产和批发环节、烟草生产与流通企业和高档卷烟产品。作为《烟草控制框架公约》的签约国,中国必须严格遵守《烟草控制框架公约》的各项条款,借鉴国际经验,结合中国实际情况,寻求进取的控烟策略,完善倡导健康卫生的烟草税收政策体系,并通过税收政策实现对烟草产业的宏观调控。     

‘An indispensable luxury’: British American Tobacco in the occupation of Germany, 1945–1948

Abstract

World War II devastated the international markets for British American Tobacco (BAT). This article uses new archival documents to show how BAT successfully navigated political and social obstacles in military-occupied Germany (1945–1948) to become the leading non-German tobacco concern in West Germany. It reveals BAT’s lobbying strategy used a ‘revolving door’ with the British and American occupation administrations and a targeted message that aligned with changing military priorities. This coordinated approach allowed BAT to overcome military resistance to big business, oppose high tobacco taxes, and push for greater foreign tobacco imports. It ultimately helped the company lay foundations for expansion.     

Business Regulations and Private Domestic Investment in Africa

In this article, the author seeks to complement the perception-based studies by utilizing the objective measures from the Doing Business project to analyze the relationship between business regulations and private domestic investment in Africa. He reports evidence that reforms in business regulations affecting contract enforcement, tax administration, firm entry, labor markets, and the private sector as a whole positively affect private domestic investment in Africa. These findings are important for assisting policy makers in creating a business regulatory environment that promotes domestic private investment and thereby encourages economic growth in Africa.     

Perceptions of Governance in Africa

Abstract

This paper reviews a survey of 800 business leaders and civil servants in Ghana, Kenya, Madagascar, Malawi, Senegal, Tanzania, Uganda, and Zambia. Like most African countries, these eight countries have undertaken governance reforms over the past decade, trying to include a wider range of views expressed by organized interest groups in the formulation of economic and commercial policies. This survey aimed to learn how business and government leaders perceive those recent governance reforms.

First, do managers and civil servants see local trade associations successfully representing the broader business point of view with decision makers, and keeping their members informed of current and proposed public policies? Second, to what extent do perceived principal/agent tensions divide companies from “their” business associations? Third, how does industry structure affect perceptions of business association perfor mance? A fourth issue is whether perceptions exist of “bureaucratic capture” or of excessive state power over business associations in the sample countries.

Most respondents see major problems with governance, though across countries they report the impression of improvement and expect further gains. This raises the risk of unmet expectations should the pace of reform slacken. Business associations are reported to work reasonably well as policy advocates for better governance. They are seen as doing a fair job of keeping members updated on the policy environment. There was little difference in opinion between larger and smaller companies, and surprising overlap between the public and private sectors. These findings are grounds for wary optimism about business-government relations in the region.

Progress will not occur automatically, however. Companies in Africa need to redouble their government relations and policy advocacy activities. The region's industry and trade associations are promising vehicles for expressing the interests of the business community.     

Advertising Regulations in Sub-Saharan Africa

Abstract

This paper examines the status and outlook of advertising regulations in sub-Saharan Africa. It begins with a synoptic overview of the region's advertising industry, which is used as a backdrop. Advertising regulations pertaining to tobacco, alcohol, pharmaceuticals, children, and politics are examined, and seven regulatory forces (consumer protection; growth of service industry; fairness and vulnerable groups; new media technologies; civil rights and privacy; religion, morality, and taste; and nationalism) likely to stimulate advertising regulations in the region are also presented. The paper concludes with implications and directions for future research.     

Revisiting FSAs and CSAs in Sub-Saharan Africa: Evidence from Ghanaian Firms

Sub-Saharan Africa (SSA) is widely perceived as a region of countries with low technological capabilities, weak complementary assets competing on basic country specific advantages (CSAs) and relying on transferred technology. In this paper we argue against this perception. Integrating the extended concepts of Location Bound (LB) and Non-Location Bound (NLB) Firm Specific Advantages (FSAs) within a “revisited” CSAs/FSAs matrix, we provide evidence that home-market grown LB-FSAs and their transformation to NLB-FSAs are induced by domestic Ghanaian firms’ strategic and export orientation.     

Foreign Direct Investment in Sub-Saharan Africa: Motivating Factors and Policy Issues

Sub-Saharan Africa's (SSA) foreign direct investment (FDI) share has persistently averaged 1% of global flows. The location decision and perceptions of investors are therefore instructive for policy making. This article factor analyses a survey of perceptions, operations, and motivations of 758 foreign investors in 10 SSA countries. We find that the provision of transaction cost–reducing information on industries and markets and utility services to investors before and after a firm's FDI decision are significant factors. FDI location decision in SSA is influenced strongly by political economy considerations. Labor and production input variables are not influential.     

Potentials of Sub-Saharan Africa in the Global Market for International Tourism

Abstract

This paper examines the future prospects of Sub-Saharan African region in the international market for tourism. This was achieved by analyzing past trends of international tourism arrivals and receipts in the region, and projecting these trends to the year 2010 using an amalgamation of four different time-series projection models after being evaluated by the MAPE. Results are given as confidence limits in three different scenarios. They show that arrivals of international tourists to Sub-Saharan Africa would increase from 17.9 millions in 2000 (end of observed period) to 28.9 million and 44.9 million tourists by the year 2010. The figures for receipts would go from $7.0b in 2000 to $11.0b and $15.3b by the year 2010. Receipts per capita (i.e., per tourist) would however decline at an annual rate of between ?0.48% and ?0.91% during the projection period. Socioeconomic impacts of these findings are given, and their implications for international marketing strategies and government public policies in Sub-Saharan Africa are discussed.     

Global agricultural trade liberalization: Is Sub-Saharan Africa a gainer or loser?

This paper analyzes the potential impact of agricultural trade liberalization on Sub-Saharan Africa. We used the Agricultural Trade and Policy Simulation Model to estimate the potential effects of agricultural trade liberalization, mainly in the US and EU, on the world-market prices of agricultural commodities. We then used the estimated price changes to assess the impact of these reforms on net-food importers as well as other Sub-Saharan African countries that enjoy preferential trade agreements with the EU and US. The results indicate that the world market prices of all commodities imported by Sub-Saharan Africa are expected to rise while the prices of the key export commodities of the region would either decline or remain unchanged. Given that the prices of major food commodities are expected to rise, net-food-importing countries will experience increasing import bill, thus leading to welfare loss. Major Sub-Saharan Africa sugar exporters who are beneficiaries of preferential agreements such as the EU sugar protocol and US AGOA initiative will become losers as preferences erode due to global liberalization. Thus, the region is expected to generally become a net loser from the current WTO reform modalities.     

Distance Education

ABSTRACT

This article examines management of accountancy education in Zambia and Zimbabwe, two countries in Sub-Saharan Africa. Both programs are collaborative efforts to manage the link between the accounting profession, governments of emerging economies and in-country postgraduate training facilities. Both programs are designed to promote the study of accounting at a level recognized by the international accountancy profession.

The programs are being developed in the context of World Bank research, which confirms linkage between economic growth and an appropriately trained accounting profession, and recognizes the need for economic growth in Sub-Saharan Africa.

Six principal program characteristics are examined: the challenge facing the accountancy profession in Sub-Saharan Africa; funding sources; details of the programs; delivery of the programs; program costs, and graduation outcomes. This article reports on the struggle faced by the accounting profession in emerging economies to make the managers of the global accountancy profession, donor agencies, and multinational commercial enterprises aware of this aspect of the developing SSA market.     

Challenges of Doing Business in Africa: A Systematic Review

ABSTRACT

This paper provides a systematic review of challenges to doing business in Africa. It complements the extant literature by answering two critical questions: what are the linkages between the ease of doing business and economic development; and what are the challenges to doing business in Africa? In providing answers to these questions, the nexus between the ease of doing business and economic development is discussed in six main strands, namely: wealth creation and sharing; opportunities of employment; balanced regional and economic development; Gross Domestic Product (GDP) and GDP per capita; standards of living and exports. Moreover, challenges to doing business are articulated along the following lines: (i) issues related to the cost of starting a business and doing business; (ii) shortage of energy and electricity; (iii) lack of access to finance; and (v) high taxes and low cross-border trade.     

Promoting SMEs in Africa

ABSTRACT

Under colonial rule, sub-Saharan Africa was self-sufficient in food production, and much produce was exported from Africa to Europe. Prior to obtaining independence, in 1957, Ghana-formerly British West African Gold Coast-had one of the most prosperous economies on the African continent. The same is true for Togo, which was administered as part of Afrique Occidentale Française from World War I until its independence in April 1960. Since these two countries obtained independence, however, Indigenous population growth has not been matched by a growth in agriculture and business activity. Today, both Ghana and Togo are net importers, even in basic grains. Can government policy help?     

Explaining Firm Internationalization in Africa Using the Competence Approach

Abstract

The purpose of the study was to explore, through secondary research, the potential influence of the top management (key decision makers) of firms on the degree of internationalization of firms in sub-Saharan Africa.

More specifically, an attempt was made, firstly, to characterize the problem of low exports and low firm internationalization in Sub-Saharan Africa with a view to discussing the potential influence of the characteristics of key decision makers on firm internationalization. Secondly, to explore the competence theory and determine whether it could provide a viable analytical framework to facilitate future empirical investigations into the influence of key decision makers (top management) on firm internationalization focusing on sub-Saharan Africa.

Previous studies on firm internationalization from different parts of the world including Sub-Saharan Africa were examined. The characteristics and behaviors of top management reported to relate strongly to high levels of firm internationalization and export performance were extracted. The literature on competence then was examined with a view to obtaining theory that would be used to integrate the various managerial variables, which strongly related to high levels of firm internationalization.

The process of analysis and integration resulted into the development of the Competence Model of Firm Internationalization, which has been proposed. The analysis indicated that the top managers of firms had profound influence on the level and intensity of export activities mainly through the firms' production and marketing functions. The managerial implications of the findings and future research directions are discussed along with the limitations of the study.     

Anticorruption Strategies in Sub-Saharan Africa: Lessons from Experience and Ingredients of a Successful Strategy

ABSTRACT

The effects of corruption on economic development have been extensively examined. There is overwhelming evidence that corruption is detrimental to economic progress. This, in turn, has provided the rationale to combat corruption. With the insistence of international development partners, many countries in Sub-Saharan Africa have put in place anticorruption strategies to fight corruption. This paper looks at the strategies adopted by some Sub-Saharan African countries to combat corruption with a view to identifying the strengths and weaknesses. Based on the successes or failures of the strategies in the cases examined, the elements that constitute a successful anticorruption strategy are identified. Of the ingredients of anticorruption strategy examined in the paper, the political will to fight corruption appears to be the overriding factor in mounting a successful anticorruption campaign. Besides identifying the necessary factors for a successful anticorruption strategy, the paper also serves as an update on the state of corruption in Sub-Saharan Africa and the literature on the causes of corruption.     

Market entry into Africa: Acquisitions and international joint ventures. Studies of foreign firms' market entry strategies,challenges, and performance in Africa

While the interest in investing in Africa is rising, the know‐how of business on the continent is very limited. There have been only recently few special issues focusing on sub‐Saharan Africa in the top international business journals: “Sub‐Saharan Africa at a key inflection point” (Thunderbird International Business Review 2009); “Contemporary developments in the management of human resources in Africa” (Journal of World Business 2011); “Contemporary challenges and opportunities of doing business in Africa” (Journal of Technological Forecasting and Social Change 2016); “Critical perspectives on international business in Africa (Critical Perspectives on International Business 2016); “Strategic Management in Africa (Global Strategy Journal, 2017); and “The internationalization of African firms (Thunderbird International Business Review 2016). The aim of this special issue is to advance understanding of international business in Africa and specifically focus on how foreign firms enter African markets via acquisitions and international joint ventures and extend knowledge of these market entry strategies and performance in Africa for research and for foreign firms intending to, or currently doing business in Africa. This guest editorial provides a summary of the five articles and one book review in this special issue categorized into three broad thematic issues: International joint ventures and acquisitions as market entry strategies in Africa; cross‐border investments of African firms; and theoretical underpinnings.     

EU's competition policy and the GE‐Honeywell merger fiasco: Transatlantic divergence and consumer and regulatory issues

This article discusses and analyzes the European Union's (EU's) competition policy and the 2001 General Electric‐Honeywell merger fiasco within the areas of global business and transatlantic issues. Based on a brief literature review of marketing, competition policy/antitrust law, vertical/horizontal integration, and global business, the article tries to explain those conditions that led to this failed merger. It is expected that in the coming years, the EU's competition policy and the United States' antitrust law will continue to differ and may create problems for those multinationals seeking large‐scale mergers and acquisitions in North America and Europe. © 2005 Wiley Periodicals, Inc.     

Interview with Jean‐Philippe Courtois,CEO, Microsoft EMEA

Founded in 1975, Microsoft (Nasdaq: MSFT) is the worldwide leader in software, services, and Internet technologies for personal and business computing. One of the most successful corporations in the world by any standard of measurement, Microsoft EMEA (Europe, Middle East, and Africa) is highly committed to a vast and particularly varied region, with more than 12,000 employees and over 60 local offices delivering products and services in 139 countries across the region. Gabriele Suder interviewed Jean‐Philippe Courtois, CEO of Microsoft EMEA and senior vice president in the Microsoft Corporation, about the company's case at the European Commission, and about the significance of the European business environment to international operations. © 2005 Wiley Periodicals, Inc.     

African Stock Market Performance Dynamics: A Multidimensional Convergence Assessment

The author dissects, with great acuteness, the issues of convergence in financial performance dynamics in the African continent through the lenses of stock market capitalization, value traded, turnover, and number of listed companies. The empirical evidence is premised on 11 homogeneous panels based on regions (Sub-Saharan and North Africa), income levels (low, middle, lower-middle, and upper-middle), legal origins (English common law and French civil law), and religious dominations (Christianity and Islam). Findings provide partial support for the existence of absolute convergence in some dynamics. Only Sub-Saharan Africa reveals conditional convergence in relation to per capita number of listed companies. The speed of convergence for the most part is between 12% and 28% per annum. As a policy implication, countries should work toward adopting common institutional and structural characteristics that favor stock market development.     

Targeting strategy for technological acquisition in the Sub-Saharan oil exporting states of Africa: The Nigerian experience

During the last two decades, economic development has been slow in most of the countries of Sub-Saharan Africa (World Bank, 1981). In the middle of the 1970s when the world economy experienced inflation and recession, no where did the crises hit with greater impact than in Sub-Saharan Africa. This region shows slow overall economic growth, sluggish agricultural performance, rapid rates of population increase, and a balance of payment crises. Between 1960 and 1979, per capita income in 19 countries grew by less than 1% per annum. During the last decade 15 countries recorded a negative rate of income growth per capita (World Bank, 1981).The economic state of the oil exporting countries (Angola, Congo and Nigeria) in Sub-Saharan Africa is not any different. The average annual growth rate of GNP per capita from 1960–1979 shows Angola at –2.1%, Congo at 0.9% and Nigeria at 3.7%.Using Nigeria as a case study, this paper postulates that since over 80% of the total revenue yield in foreign exchange comes from crude petroleum export alone, it has become urgent to ensure; (a) that the techniques in oil technology are acquired by Nigerians so as to conserve the foreign exchange cost arising from foreign personnel drawings, such as salaries and perquisites; (b) that Nigerians become immersed in the techniques of oil technology in order to make maximum use of the by-products of crude oil in a conscious exploitation of the industry's potential directed towards the economic development of Nigeria.Bedford A. Fubara is Senior Lecturer of Business Policy and Head of the Department of Business Administration at the Rivers State University of Science and Technology, Port Harcourt, Nigeria.He had the Columbia University Fellowship 1970/72 and the UNESCO Research Award 1981/82.He is the author of several articles on business concerning Nigeria and the developing countries.Paper presented at the Strategic Management Conference at the Wharton School, The University of Pennsylvania, Philadelphia, U.S.A. October, 1984.This research is financed by the University of Science and Technology, Port Harcourt, Nigeria, under Project SRPC/1983/014.