Multinational Corporations and Their Corporate Citizenships: Exploring Their Effects on Corporate Performance Under Different Legal Traditions

• Published date: 01 August 2024
• Author: Stefania Camoletto,María J. Montes‐Sancho,Erica Santini
• Date: 01 August 2024
• DOI: http://doi.org/10.1002/pa.2942

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Journal of Public Affairs, 2024; 24:e2942

https://doi.org/10.1002/pa.2942

Journal of Public Affair s

RESEARCH ARTICLE OPEN ACCESS

Multinational Corporations and Their Corporate

Citizenships: Exploring Their Effects on Corporate

Performance Under Different Legal Traditions

StefaniaCamoletto1 | MaríaJ.Montes- Sancho2 | EricaSantini 3

1Department of Economic s and Statistics “Cognett i De Martiis”, University of T urin, Torino, Italy | 2Departamento de E conomía de la Empresa,

Universidad Carlos I II de Madrid, Geta fe, Madrid, Spain | 3Department of Economic s and Management, Universit y of Trento, Trento, Italy

Correspondence: Stefa nia Camoletto (stefania.camoletto@unito.it)

Received: 15 November 2023 | Rev ised: 31 May 2024 | Accepted: 13 July 202 4

Funding: This work was supporte d by the Ministry of Sc ience, Innovation and Universitie s (Grant # PID2019- 105616RB- I00) and the Ministr y of Science

and Innovation (Grant # PID2 022- 140026NB- I00).

Keywords: corporate citi zenship | corporate phila nthropy | corporate soc ial responsibility | multi national firms

ABS TRAC T

In this paper, we focus on the conceptuali zation of corporate citizenship and exa mine the effects of its tangible manifestation,

in the form of corporate philanth ropy, on company performance recog nizing the importance of the institutional context s where

companies are embedded. Based on a s ample of 752 multinational companies that have joined the UN Global Compact, we ex-

plore the derived benefits, using as a moderator the legal env ironment where companies operate. The results of the random- effect

regression analysis show the ex istence of a positive relationship between corporate citizenship and corpor ate market valuation

over the study period (2016– 2022). Findings on c orporate citizenship are consistent w ith previous studies, and the role of the

legal tradition emerges as a salient avenue for future investi gation. Companies that highly leverage the philanthropic di mension

of corporate citizenship and are pr imarily embedded in a common- law t radition benefit more than those operating in a civil- law

system.

1 | Introduction

Corporate social respon sibility (CSR) is a cross- disciplinary

field of research that has been exa mined by a variety of ac-

ademic disciplines (e.g., Gillan, Koch, and Sta rks 2 021;

McWilliams, Siegel, and Wright 2006) for more than hal f a

century. Researchers have prima rily focused on understand-

ing why companies increasing ly engage in CSR practices

(Gupta and Kumar2022; Marano and Kostova2016) , and their

implementation and p otential benefits (Coelho, Jayantilal, and

Ferreira  2023). Interest in the multi- level nature and effects

of CSR has increased i n the last decades, with a strong foc us

on whether socially responsible fir ms are also profitable (Fu

et al.2024; Busch and Friede2 018).

In this debate, the concept of corporate citiz enship has attracted

significant attention. Acc ording to Carroll (1998), corporate

citizenship encompasses the multi- level effec ts of being a good

corporate citizen. Compared to t he traditional concept of CSR,

corporate citizenship can b e seen as a distinct and broader cat-

egory, able to capture the new role that corporations might play

in the globalized scena rio (Sacconi2 007; Baumann- Pauly and

Scherer2013). Given the global economy in which organi zations

operate today, it seems to be more appropriate to address this

issue through the lens of corporate citi zenship. This approach

implicitly incorporates the socio- political commitments of

businesses and the welfar ist approach aligning with t he idea

of businesses contributing to the public welfa re and providing

public goods as goods or serv ices that benefit society collectively

This is an open ac cess article un der the terms of the Creat ive Commons Attribution Lic ense, which perm its use, distri bution and reproduction i n any medium, provi ded the original w ork is

properly cited.

© 2024 The Autho r(s). Journal of Public A ffairs publishe d by John Wiley & Sons Lt d.