Relationship between Foreign Direct Investment and Corporate Social Essay

Relationship surrounded by Foreign Direct enthronization and Corporate Social Responsibility - Essay ExampleIt is clearly shown in this report that foreign develop investment complicates the CSR practices of multinational corporations and other businesses operating internationally. This shows that there is a strong kind between CSR and FDI. The relationship is influenced by several factors. First, stakeholder authenticity problems cause international businesses to adapt to local CSR practices because stakeholders in soldiery countries exercise pressure on them to behave according to their interests in order to be considered legitimate. Secondly, international human imagery management policies in legion countries may complicate CSR practices of the foreign country due to the difference between HRM practices of the host and home country. An expatriate problem also results in complex CSR practices because expatriates may experience naked cultures and behaviors in the host countr y that may change their CSR practices. Institutional distance is also considered as other factor affecting the relationship between CSR and FDI. A high institutional distance between hoe and host country usually leads the multinational corporation to adapt to the local CSR practices. Recent research indicates that a company operating in host countries with a different institutional environment and demanding stakeholders are potential to adopt local practices in order to legitimize their foreign direct investment in host countries. This can be explained using the institutional theory and stakeholder theory which explain internal and external motivations for legitimacy in multinational corporations. Foreign Direct Investment is the acquisition of assets by an international company in another country. Foreign Direct Investors face the challenge of integrating home country CSR practices and the demands of stakeholders in the host country. Understanding these legitimacy pressures for fo reign direct investment requires a link between corporate kindly responsibility and foreign direct investment.