Culture of Sustainability and Marketing Orientation of Indian Agribusiness in implementing CSR Programs—Insights from Emerging Market

Abstract

The debate regarding the suitability of market orientation or culture of sustainability for corporate social responsibility (CSR) implementation and economic sustainability deserve much more scholarly attention as globalization and competition in emerging markets increases. Using qualitative content analysis of interviews with 28 senior managers of large agribusiness firms in India, this empirical article explores how market orientation or culture of sustainability affects CSR implementation, or vice versa? The findings of the study identify factors such as the nature of a firm’s business, sensitivity, commitment towards sustainable development, and pressure on profitability that prompt firms to adopt sustainability dominant, market dominant, and sustainability–market mixed corporate culture. Culture of sustainability dominant firms are likely to implement CSR more smoothly and effectively compared to firms that are driven by market orientation. Moreover, firms committed to substantial and consistent CSR are likely to induce culture of sustainability in firms. Finally, the study offers a framework that provides insights into how CSR program implementation and a culture of sustainability are complementary and could strengthen the economic sustainability of firms in emerging markets.

1. Introduction

Recently, the public attention has increased on agribusiness-related aspects of CSR due to growing concern over the potential detrimental effect of agribusiness on society (Luhmann and Theuvsen 2016; Heyder and Theuvsen 2008). Agribusiness is the backbone of many emerging markets, but it is facing many conflicts with society. For example, in order to increase farm productivity, farmers have increasingly turned to chemical nutrients and environmentally unsound herbicides/pesticides (Poetz et al. 2013; Raj 2017). The entire agribusiness industry faces increasing pressure from environment, health, and animal rights advocates (Edwards and Shultz 2005). The concept of corporate social responsibility (CSR) is often considered a potential tool for meeting societal demands and criticism as a company voluntarily takes responsibility for society (Luhmann and Theuvsen 2016). CSR in agribusiness is of such paramount importance that some authors consider CSR as a ‘license to operate’ in an agribusiness context. The ‘license to operate’ notion is derived from the fact that every company needs either tacit or explicit permission from the government, communities, and numerous other stakeholders to do business (Hiss 2009; Porter and Kramer 2011).

Firms in emerging markets are increasingly adopting market orientation due to globalization and increased competition. These types of firms are primarily driven by market forces, competition, sales, and profits and infuse market orientation mind-sets in their functional and customer-level managers (Bodlaj 2012). Few other firms are driven by a culture of sustainability where everyday conversations have a sustainability angle, and decisions made in the organization take a triple bottom line rather than just an economic view (Schönborn et al. 2019). A culture of sustainability is a feature of firms that have integrated social and environmental policies in their business model (Brochet et al. 2012). However, the adoption and implementation of market orientation/culture of sustainability as a strategic orientation and its effect on CSR implementation in the emerging market context are under-researched (Yaprak et al. 2015; Brochet et al. 2012; Kucharska and Kowalczyk 2019). A corporate culture of sustainability raises several fundamental questions. For example, do sustainability firms have better stakeholder engagement? Do their information dissemination systems differ? Could meeting other stakeholders’ expectations come at the cost of creating shareholder value?

In a developed market, the adoption of market orientation is lauded for effective CSR implementation as CSR programs are customer-centric. In emerging markets, CSR programs may be community-centric (Moon 2002; Jamali 2014; Raj et al. 2019). Hence, the manifestation of CSR programs in firms possessing market orientation or a culture of sustainability could differ, posing challenges to managers implementing CSR in emerging markets. This research issue is of more importance and challenging in emerging market situations, which are not only different contexts to generate new propositions but are also subject to dynamic and volatile environments in which managerial best practice remains elusive (Kumar and Srivastava 2019).

However, in recent years, the influence of market orientation in agribusiness sector is quite evident. With increased competition and pressure on profitability, agribusiness firms are promoting environmentally unsound herbicides/pesticides, fertilizer, and seeds posing threat to not only people’s health and environment, but also the economic sustainability of firms (Poetz et al. 2013; Raj 2017). Agribusiness firms in emerging markets face the challenge of employing CSR strategically to advance their relations with stakeholders and strengthen their competitiveness (Raj 2018). However, CSR programs in agribusiness firms have community orientation, making them a fit case for our study.

This study is situated in the Indian agribusiness sector which is heavily dependent upon the local community for agriculture and resource purposes. The traditional large Indian agribusiness firms are generally known for sustainability management practices, thereby fostering a culture of sustainability. Friedrich et al. (2012) argue that, in agribusiness, attributing sustainability management to the top management team is a strong symbol that demonstrates the high relevance of this task to internal and external stakeholders and contributes to the development of a sustainability oriented organizational culture (Friedrich et al. 2012). These authors call for tracking the implementation of sustainability management concepts in the agribusiness sector over time and to see where the industry moves and whether a dominant cultural design emerges.

In developed market, some CSR assessment and implementation framework are gaining lot of attention. For example, in Europe, the economy for the common good (ECG) model aims to benefit all stakeholders in an organization, namely employees, suppliers, customers, business partners, the local community, and society at large, using a common good balance sheet, which measures the impact the organization has on these stakeholders. The ECG goals are aligned with United Nations Social Development goals (SDGs) to achieve a better and more sustainable future for all. At the heart of this concept lies the idea that values-driven businesses are mindful and committed to issues like environmental sustainability, social justice, and human dignity. Similarly, in the US, Certified B Corporations are a kind of business that balance purpose and profit. It measures a company’s entire social and environmental performance. They are legally required to consider the impact of their decisions on their workers, customers, suppliers, community, and the environment. B Corporation certification has emerged as a widely celebrated means for owners and founders of firms to effectively certify their values practices, that validates their unique set of values (Gehman et al. 2019).

However, in developing countries there is a lack of such robust framework, albeit, the actual process of developing, implementing, and assessing CSR initiatives could be more challenging and the models and suggestions available to managers for CSR implementation in a developing country are unclear (Mak et al. 2015; Muthuri et al. 2012). Moreover, the authors call for emphasizing the special position of CSR in agribusiness and that future research should focus on adding value to industry-specific CSR aspects in the general CSR framework borrowed from management literature (Luhmann and Theuvsen 2016). This study attempts to bridge this gap by empirically exploring how market orientation or a culture of sustainability affects CSR implementation or vice versa in large Indian agribusiness firms. The rest of the paper is arranged as follows. We first review the literature on market orientation and culture of sustainability relation with CSR. Then, the methodology is described along with a commentary on the agribusiness sector in India. Then, the findings obtained are presented. Finally, we discuss the results and draw conclusions.

2. Market Orientation and CSR

Market orientation (MO) is useful in explaining how organizations adapt to their customer environment by focusing on customer relations to develop competitive advantages (Kiessling et al. 2016). Market orientation (MO) consists of intelligence gathering, dissemination, and then a firm’s management’s subsequent tactics to implement this new market knowledge (Kohli and Jaworski 1990; Kiessling et al. 2016). Proponents of market orientation argue that customer has the greatest impact on firm performance (Kiessling et al. 2016). The seminal paper by Slater and Narver (1994) acknowledged the link between CSR and market orientation, wherein they argued that since market orientation requires clear, external orientation from organizations, firms should be sensitive to the expectations and needs of society in general, not only to those of their customers and competitors.

Recent literature indicates that, due to globalization and privatization, there may be a trend of adopting a market orientation in emerging markets that are primarily driven by market forces, competition, sales, and profits. Some recent research suggests that, in emerging markets, firms should pay much more attention to the development of ‘market orientation’. For example, Bodlaj (2012) shows that the transition from a state-controlled to a liberalized market economy required fundamental changes in managerial attitudes in Slovenia, arguing for a rapid adoption of market orientation as a competitive tool. Embracing market orientation by Slovenian firms infused changes in managerial attitude and behavior and focused them on customer value. In another study, Özturan et al. (2014) show that firms who are more responsive to the market conditions in the turbulent Turkish context (economic contraction followed by rapid economic expansion) achieved higher performance in their advertising strategies when compared to other firms. Thus, market orientation resulted in an improved communication strategy with a positive impact on firms’ performance. In summary, these studies conducted in emerging market contexts highlight that firms have increasingly become more market-oriented in the quest for improved performance and profitability.

Some authors argue that in the West, a positive relationship exists between market orientation and firm performance often indicated through CSR parameters (Kirca et al. 2005; Yaprak et al. 2015). It is argued that, in a developed market, market orientation will facilitate effective CSR implementation because of professionalism, management skills, and the fact that the consumer is sensitive to CSR programs. However, other stream of research claims that these categories of firms generally tend to adopt CSR programs only to protect the image of the organization (i.e., mitigate harm) after some irresponsible action has been reported (Murray and Vogel 1997; Wagner 2010). This type of reactive CSR is used for damage control and immediate reconciliation with the stakeholders. Sometimes reactive CSR may lead to negative and skeptical attitudes of the consumers towards the company (Ricks 2005).

3. Culture of Sustainability and CSR

A culture of sustainability is a feature of firms that have integrated social and environmental policies in their business model (Brochet et al. 2012; Bertels et al. 2010). These firms place more emphasis on long-term goals, care more about the impact of externalities from their operations on other stakeholders and the environment, and focus more on the ethical grounds of their decision (Payne 2006). These policies reflect the underlying culture of the organisation, in which environmental and social performance, in addition to financial performance, is important. A culture of sustainability is one in which organizational members hold shared assumptions and beliefs about the importance of balancing economic efficiency, social equity and environmental accountability involving embedding sustainability into organizational culture (Bertels et al. 2010). This perspective is strengthened by Brocchi (2010) who defines a culture of sustainability as a conceptual set of values that motivate and induce sustainable actions in daily practices. This is possible by building an organizational infrastructure that fosters a culture of sustainability which results in positive employee-level and organizational-level sustainability performance (Galpin et al. 2015).

However, the adoption of the corporate culture of sustainability raises a number of fundamental questions. For example, do sustainability firms have better stakeholder engagement? Does their information dissemination system differ? Could meeting other stakeholders’ expectations come at the cost of creating shareholder value? Some argue that companies do well by doing well (Godfrey 2005; Margolis et al. 2007; Porter and Kramer 2011). This claim is based on the belief that meeting the needs of stakeholders other than shareholders directly creates value (Freeman 1984; Porter and Kramer 2011). It also reflects the belief that not meeting the needs of these stakeholder can destroy shareholder value, for example, through customer boycotts (Sen and Bhattacharya 2001), an inability to hire the most talented people (e.g., Greening and Turban 2000), and punitive fines by the government. These consequences will have negative impact on the economic sustainability of firms. Hence, the firm must avoid engaging in activities that are not in the interest of its stakeholders. On the contrary, when the firm meets the need of its stakeholders it gets support for its activities. However, the firm must address the long-term interest of its stakeholders in order to protect and strengthen the economic sustainability of firms.

In firms adopting culture of sustainability, corporate social responsibility (CSR) is used for combining the economic, social and environmental concerns into organisation’s overall strategy (Dasgupta and Banker 2015). CSR dimensions can help firms to attain a competitive advantage and economic sustainability (Calabrese et al. 2013). They propose a two-dimensional CSR model for supporting managers in their pursuing for long-term competitiveness: the ‘CSR development’ dimension and the ‘CSR commitment’ dimension. The CSR development dimension allows decision makers to position companies with respect to the stage of their CSR cultural evolution, whereas the CSR commitment dimension assesses companies’ degree of commitment based on their economic, legal, ethical, and philanthropic CSR performance. The position that a company occupies in the two-dimensional CSR model describes both its actual stage of CSR cultural development and its CSR commitment.

However, firms that belong to this group may be expected to actively engage in CSR programs, irrespective of any pressure from stakeholder or media. They tend to pursue CSR programs even prior to any negative information being received by stakeholders (Du et al. 2010). Stakeholders typically perceive proactive CSR positively due to its seemingly altruistic nature (Becker-Olsen et al. 2006). They found that proactive CSR resulted in more favorable attitudes of the consumers in the form of increasing purchase intention of the company’s products.

Thus, while market-oriented firms are expected to resort to reactive CSR strategy, firms possessing culture of sustainability would pursue proactive CSR strategy. Market oriented firms use reactive CSR strategies for damage control after some irresponsible action has been done that may alienate the community and the stakeholder and may lead to negative and skeptical attitudes towards the company (Ricks 2005). On the contrary, firms possessing culture of sustainability might be able to reduce the aggressive and negative attitude of the community when a new CSR project is launched (Du et al. 2010)

4. Research Context—Indian Agribusiness Sector

This study is conducted in the Indian agribusiness sector. Agribusiness in India has experienced conflicts with society over the polluted environment, water, and soil, loss of livelihood and income of farmers, and concerns about public health. Prior to the mid-1960s, India relied primarily on imports and food aid to meet domestic requirements. However, after severe drought in 1965 and 1966, India reformed its agricultural policy. India adopted significant policy reforms focused on the goal of food grain self-sufficiency. This led to a program of agricultural improvement called the ‘Green Revolution’. It involved bringing additional area under cultivation, extension of irrigation facilities, the use of improved high-yielding variety of seeds, better techniques evolved through agricultural research, water management and plant protection through judicious use of fertilisers, pesticides and cropping practices. Although the ‘Green Revolution’ in India has helped to substantially increase the production of grain, this has come at a huge environmental cost (Pingali 2012). It was characterised by the use of high yielding varieties of seeds which were more responsive to external inputs (such as fertiliser, pesticides and insecticides) for productivity. However, appropriate research and policies to incentivize the judicious use of inputs were largely lacking (Pingali 2012). Hence, unintended consequences in water use, soil degradation, and chemical runoff produced serious environmental damage (Burney et al. 2010). Trial runs of genetically modified (GM) crops have also faced widespread opposition from environmentalists, health agencies, and farmers. Since hybrid and biotech seeds do not breed on their own, in addition to environmental and health safety concerns, there is the fear that farmers may become totally dependent on large companies for the provision of seeds, which will have serious implications for these companies, not least because they will find themselves even more in the limelight of public scrutiny. Agribusiness firms, particularly food companies are also blamed for health-related issues such as the promotion of junk food, adulterated food, and substandard food.

Another challenge for agribusiness firms is to establish fair and effective relations with the farming community that benefit both sides. This is not always the case as large firms are accused sometimes of using their power to the disadvantage of the farmers. In this context, the conflicts related to contract farming may be mentioned. Contract farming is a system for the production and supply of agricultural and horticultural produce by farmers/primary producers under advance contracts, the essence of such arrangements being a commitment to provide an agricultural commodity of a particular type (quality/variety) at specified time, price, and in a specified quantity to a known buyer (Singh 2002). Large firms are sometimes accused of not always holding their side of the bargain. They were found to deny farmers compensation in case of crop failure, delayed payments, poor technical assistance, manipulation of quality standards and outright cheating. This has generated a debate over the role of the existing agribusiness corporate cultural models in enhancing farm income and employment and social responsibility programs of agribusiness firms (Raj 2017).

4.1. Agribusiness and CSR

Despite the high conflict potential in the agribusiness, so far only small-scale research has been undertaken in the field of agribusiness relations to society, even though the relevance of integrating societal demands of the external environment, e.g., concerning animal welfare, food safety, environmental concerns, and the use of GMOs (Grunert 2005), into firm strategies in the agribusiness has been recognized. More lately, it is discussed in literature whether using Corporate Social Responsibility (CSR) is an instrument for enhancing legitimacy of business operations (Luhmann and Theuvsen 2016). Implementing CSR could be an appropriate means to legitimate business activities, especially in the agribusiness. In combination with a better reputation, an improved “license to operate” could make enterprises operating in the highly criticized agribusiness more immune against campaigns of pressure groups. Following a CSR strategy and being a “good citizen” in the community can be suitable ways for obtaining legitimacy and conciliating public opinion towards enterprises in the agribusiness (Heyder and Theuvsen 2008).

4.2. Agribusiness and Market Orientation

Market orientation consists of a focus on customers, an understanding of competitors, and integration of all functions within the company to create superior customer value (Slater and Narver 1994). In the agribusiness field, market orientation has been mentioned in qualitative studies (van Duren et al. 2003), Despite the collective research, market orientation has seen limited attention in the natural resources fields (Hansen et al. 2006; Slater and Narver 1994), and surprisingly little work has been conducted specific to agriculture (Martino and Tregear 2001; Micheels and Gow 2008). Few studies try to link market orientation with agribusiness firms’ performance. For example, a study of 176 food manufacturing businesses in Zimbabwe found no connections between market orientation and performance (Mavondo and Farrell 2003). Another study in UK found that companies viewed “marketing” rather negatively, yet concluded that they were market oriented since they recognized customer concerns (Lewis et al. 2001). However, the literature indicate that the more successful firms are more internally focused (interfunctional coordination and innovativeness) than externally focused (competitor and customer orientation) (Johnson et al. 2009).

4.3. Agribusiness and Culture of Sustainability

Agribusiness firms face conflict with the society regarding environmental issues and for promoting harmful chemicals, fertilizer, and seeds to the farming community (Luhmann and Theuvsen 2016; Poetz et al. 2013). For example, agribusiness firms face backlash from society for promoting genetically modified (GM) seeds, adulterated food, depleting water table, worsening of soil conditions, polluting the air quality etc. In order to combat the conflict with society, agribusiness firms are committed towards social development and environmental issues. The United Nations (2005) identifies economic development, social development, and environmental protection as three integrated elements of sustainable development. So, naturally, agribusiness firms should practice activities and foster an organizational environment that promotes sustainability. In this sense, agribusiness firms are expected to be naturally aligned to a ‘culture of sustainability’ which is a feature of firms that integrate social and environmental policies in their business model (Brochet et al. 2012; Bertels et al. 2010). Literature indicate that strong management pressures in agribusiness firms have a positive and highly significant relationship with the level of a firm’s sustainability initiatives (Galpin et al. 2015). The studies show that agribusiness firms have started to react to growing discussions about the sustainability of their products and business processes by implementing sustainability management or CSR activities (Galpin et al. 2015).

5. Methodology

This study intends to address the research questions by exploring the perception of managers regarding the research issues. Qualitative research approaches have been used by researchers in order to obtain ‘a more naturalistic, contextual and holistic understanding of human beings in society’ (Todd et al. 2004). This approach focuses on studying phenomena in their natural settings and strives to make sense of these phenomena with respect to the meanings people bring to them (Banister et al. 1994). By its very nature, qualitative research emphasises cultural and contextual factors that enhance or impede the efficacy and social/ecological validity of interventions or programs (Nastasi and Schensul 2005).

Table 1. Profile of sample companies.

Company	Key Business	Year of Inception	No. of Employee	Turnover in Crore (Rs)
A	Fertiliser, Pesticides, Salt, Water	1939	4752	8892
B	Packaged food and juice, Herbs, Ayurvedic medicines	1940	6382	4979
C	Tractors and farm machinery	1944	10,483	6372
D	Seeds, Agri. retail, fertiliser	1932	2553	6133

outlines the profile of the selected companies. Due to reasons of anonymity their true names cannot be revealed; instead letters are used.

Data were collected using a key informant method that involves interviewing individuals who are likely to provide needed information, ideas, and insights on a particular subject (Kumar 1989). Accordingly, in the four firms 28 company executives in charge of CSR and relevant senior and middle level managers were selected as informants. One advantage of using key informant interviews is that information comes directly from the knowledgeable people; hence it can provide data and insights that cannot be obtained from other methods (Kumar 1989). Another advantage is that it provides flexibility to explore new ideas and issues that had been not been anticipated in planning the study but that are relevant to its purpose.

An interview guideline was prepared comprising of unstructured questions. The order of questions varied depending on the flow of conversation. The interviews were recorded with a voice recorder after getting consent from the respondent. Interviews lasted between forty minutes and 90 min and were conducted until saturation in responses was achieved (Kvale 1999). Transcripts were prepared on the same night so that the researcher does not miss important points. The transcripts were analysed by applying a content analysis technique to accomplish deeper insights and new themes were identified. Field notes and observations and some key documents were also helpful in preparing the final analysis of the findings. This procedure promoted validity and reliability as interviewees had the time to consider the information requested and where appropriate to gather any supporting organisational documents that they thought would be useful (Fontana et al. 2005). Interrater reliability is a concern to one degree or another in most large studies due to the fact that multiple people collecting data may experience and interpret the phenomena of interest differently. However, in this study the lead author alone was responsible for collecting data minimizing the concern for interrater reliability.

6. Data Analysis and Findings

Once the data were collected and interviews transcribed, responses were analysed via a thematic approach. Bailey suggests that ‘thematic analysis works most effectively when you seek themes that address your research questions, frame themes conceptually, and explore links among them’. The author followed the process of interpretive analysis suggested by Spiggle (1994) by analysing each interview separately and then merging them together into a consistent whole.

A preliminary examination was carried out through a word count query function available in N-Vivo 10. This function enables us to identify key words used most frequently or infrequently by the interviewees. However, word lists and word counts take words out of their original context. A key word in context (KWIC) approach addresses this problem. KWIC is a data analysis method that reveals how respondents use words in context and can also help in identifying underlying connections that the participant was implying through her/his speech (Fielding and Lee 1998).

Once the preliminary analysis was complete, the study employed the QSR NUD*IST Vivo (NVivo-10) software for gaining deeper insights and to facilitate the management of the data. NVivo is one of qualitative analysis tools most widely used by scholars. This is a software package for the management and analysis of qualitative data that provides an online environment for organizing and handling data, notes and ideas. It was chosen because it allows researchers to code text while working at the computer and to easily retrieve the coded text (Bryman and Bell 2015). These features enabled the researcher to better organize the transcribed text and get a clearer view on interviewees’ responses.

A word count query reveals that word ‘market’ or ‘marketing’ was used for 129 times and ‘sustainable’ or ‘sustainability’ was used for 92 times in the transcripts. With the help of content analysis, two major themes of the study, i.e., ‘sustainability culture and CSR implementation’ and ‘market orientation and CSR implementation’, were investigated in detail, and have been described below.

7. Market Orientation and CSR Implementation

The findings of the study indicate that two of the sample firms (C and D) have dominant market orientation where decisions are primarily taken on the basis of market forces and competition. These firms have huge pressure to cut cost and increase profitability. It is evident in some of the quotes of the managers as mentioned below:

In the farm mechanisation and tractor industry, there is a huge gap in market share among the leader, the second, and the third. So, when there is such a huge difference then what drives you is the competitive spirit.

(Vice President, Sales and Marketing, Firm ‘C’)

Firm ‘D’ relies on a low pricing strategy and tries to beat the competition by paying incentives to its sales force in highly competitive categories, such as pesticides and herbicides.

We keep the price of our product very low. We provide a good product at low price.

(Manager Marketing, Firm ‘D’)

D is a highly competitive player and pays incentive to its employee in categories like pesticides and herbicides where lot of competition exists company is strongly governed by market norms’.

(General Manager, Marketing, Firm ‘D’)

It may be noted that firms ‘C’ and ‘D’ are facing extreme pressure to reduce cost and increase profitability. Senior Vice President of Firm ‘C’ said:

We as a company... today we are not making much money. In terms of the whole tractor industry, if I have to take the leader, they make about 18–19% EBITA (earnings before interest and taxes and amortization). They are number one. And when we make lesser EBITA, that means our costs are very high. The smallest among the Indian player makes about 21% EBITA. We make about 9% EBITA. So, we are very inefficient in a sense.

He continues:

Our costs are high because of the inherent problem … because we are a very old company in a same place. So, our manpower cost is the biggest burden which we have. So, if the industry standard is about 4% manpower, we are about 10% manpower. So, our manpower costs are very high. We try to keep our cost very low because we are under tremendous pressure to cut cost.

(Manager–Marketing, Firm ‘D’)

Market orientation seems to be prevalent in firms ‘C’ and ‘D’. For these firms, decisions are guided by market orientation. A Marketing Manager of firm ‘C’ asserts:

Marketing becomes very important because, again, reaching out to millions of customers is the job of marketing. As well as to find out what is changing, what is the need of the customer is again the job of marketing. What the competition is doing is again the job of marketing.

Firms ‘A’ and ‘B’ marketing strategies are driven by long term goals and they consider the issues of ethics and sustainability more seriously than firm “C” and ‘D”.

Marketing function is heart and soul and we give incentives... absolutely. Sales incentives are given. But we do not compromise on quality and ethics. For example, we will never sell our fertilisers which are in red zone. We sell only those fertilisers which are in green and yellow zone. We do not adopt short term measures to increase our sales’.

(Brand Manager, Firm ‘A’)

The data further reveal that firm ‘C’ and ‘D’ do not provide a conducive atmosphere for the promotion of CSR activities. For example, in firm ‘C’, the Senor Manager informs that, even though good ideas are being brought by employees, the firm may not support most of them, citing cost or implementation issues. In firm ‘D’, all employees are not even aware of firm’s CSR activities and CSR is not a part of performance appraisal goal sheet or key result area (KRA). These evidences indicate a weak culture of sustainability in these firms.

A deeper analysis of the interview transcripts reveals that the CSR programme of firm ‘C’ and ‘D’ is mainly motivated by ‘legal compliance’.

Currently, it (CSR) is only for compliance.

(Senior Vice President-Marketing and Sales of Firm ‘C’)

If there is no fear of compliance, then you will not do anything. If firms are not afraid of compliance, then they will not pay even taxes.

(The Vice President—CSR of Firm ‘C‘)

Currently, in India, companies are focused on here and now. CSR is a long, drawn out process. Unless and until you are a leader, you cannot do CSR activities for marketing benefit.

(Senior Vice President, Marketing and Sales of Firm ‘C’)

CSR is done for meeting statutory requirements and tax saving.

(General Manager, Marketing of Firm ‘D’)

Compliance with the law means operating at a minimum level of acceptable conduct. It has often been said that law is at the floor level of acceptable behaviour (Carroll 1998). These firms (C and D) do not seem to be pursuing large scale CSR programs beyond legal compliance. By contrast, firms ‘A’ and ‘B’ view ‘legal compliance’ as a threshold level to pursue CSR and go beyond what is mandated by the law. The Vice President (corporate communication) of firm ‘B’ states:

We are already doing [in terms of CSR] more than what is mandated by the law.

Our finding asserts that firms adopting market orientation are focused on reducing cost of operation leading to less fund available for CSR implementation. When less funding is available for CSR implementation, it impacts the choice of CSR implementing agencies. Our result revealed that such firms take help of either small NGOs or industry associations for CSR implementation where the cost is shared among other sponsoring firms. These have been described below.

7.1. Partnering with NGOs

Market oriented firms partner with NGOs to implement CSR programs. This approach is useful when firms practice CSR on an irregular basis or when a firm does not have expertise in a given social activity. For example, firm ‘C’ and ‘D’ primarily relies on this approach because it implements need based CSR program and CSR is not embedded in organizational culture. Partnering with NGOs is effective in CSR implementation when the firms do not have specialized people and requisite expertise to carry out social and community development works. In this type of arrangement, firms need to monitor CSR implementation program by NGOs. The pros and cons of CSR program implementation by NGOs is a vast topic of debate that does not fall in the ambit of this paper.

7.2. Collaboration with Industrial Associations

Some firms collaborate with industry associations and networks to implement its CSR programs. One of the main reasons to associate with these forums is to pool the money and share the resources to run a collective CSR program. This is a less costly form of participation in CSR activities. Firm ‘C’ primarily relies on this method. One advantage is firms get brand visibility wherever the industry association is implementing any CSR program. For example, the Head of CSR of firm ‘C’ states:

This is the easiest way to increase brand visibility in an industry forum.

In light of new the Indian law on CSR, mandating firms to spend 2% of the net profit on CSR, such firms may be pursuing CSR programs only for legal compliance and statutory requirements due to the focus on reducing cost and increasing profit. The evidence indicates that such firms do not engage in regular CSR practices and pursue a reactive CSR strategy whenever needed. These findings lead to our research propositions:

Research Proposition 1.

Firms in emerging markets that possess market orientation will do CSR to meet legal obligations and compliance. These firms will pursue irregular and reactive CSR programs. Market orientation dominant firms in emerging markets are less likely to embrace CSR in its corporate strategy, thereby gaining a competitive advantage from CSR.

In addition, an interesting observation is that in firms where market orientation is more dominant the CSR department gets less attention from the top management as compared to other core departments. As CSR manager of firm ‘D’ laments:

No! No! No! In comparison to other departments, there is some difference between CSR and other departments. Say, in terms of salary, promotion, and incentive.

8. Culture of Sustainability and CSR

A culture of sustainability is embedded in in the business model of firms who place more emphasis on long-term goals, care more about the impact of externalities from their operations on other stakeholders and the environment, and build an organizational infrastructure that induces organizational level sustainability performance (Galpin et al. 2015; Payne 2006).

The evidence indicates strong linkages between CSR and environmental sustainability, the latter being an integral part of CSR, one cannot visualize the existence of environmental sustainability without CSR.

There is linkage of CSR with sustainability. They are both go hand in hand. You cannot, distinguish the two. Environment is the key part entire scheme of thing. They also have to be sustainable in nature. Be it at your plant, be it in the ecosystem.

Hence in a broader sense the ‘culture of sustainability’ can also be termed as ‘culture of social responsibility’. Such firms design policies to undertake organisational activities that promotes CSR, possess a corporate culture which is conducive for CSR, environmentally sustainability, ethical and moral values, and long-term goals of the firm.

Content analysis reveals that firm ‘A’ and ‘B’ possess dominant culture of sustainability.

[Environmental] Sustainability is the first thing we keep in mind. It is not only in vision but is also translated on the ground. Whatever business opportunity we explore; we examine the business opportunity on three parameters. One is whether it is going to be socially beneficial, what way it is going to be economically beneficial in terms of the income and lifestyle of people, and third is how it is going to impact the environment. If we find that this business opportunity is going to adversely impact the environment, then we may decide not to go forward. So that is what ensures your brand to be sustainable.

(Associate Vice President, Corporate Affairs, Firm ‘A’)

We embrace environmental sustainability as part of our overall strategy and business values. Numerous initiatives have been put in place to ensure that we do our part to create a cleaner, healthier environment for future generations.

(Vice President, Corporate Communication, Firm ‘B’)

At ‘B’, we value nature’s bounty. Without the fruits of nature, the vision of Firm ‘B’— dedicated to the health and well-being of every household—would never have been fulfilled.

(Brand Manager, Firm ‘B’)

Some manufacturing sites modified their boilers to use biofuels, resulting in significant environmental benefits by reducing the CO2 emissions. The company has also conducted water audit at some of its units and have initiated the process of conducting a water footprint study across other units to further improve our water management.

(Head of CSR, Firm ‘B’)

It is evident that firms ‘A’ and ‘B’ go beyond the legal mandate in their commitment towards environmental sustainability. However, sometimes the firm ‘B’ use CSR to ensure environmental sustainability in decree of law. As the CSR head of firm ‘B’ informs:

Different laws have come up. You can’t take herbs from forest. Every state has different law. Then to sustain this [CSR] activity you have to have partnership with the NGO. If a company is not doing CSR it [firm] will not be sustainable. In the long run it [firm] will have problem. Sure. That is required.

Consequently, the procurement of raw material and supply chain arrangements are influenced by the firm’s deep commitment to the environmental sustainability within the existing legal framework. Thus, we see that CSR is part of business model in such organizations. These descriptions reflect the underlying culture of the organisation, in which environmental and social performance, in addition to financial performance, is important that ensures long term economic sustainability.

Culture of sustainability dominant firms focus on long term economic goals and CSR is proactively implemented in a planned manner through their own independent arms like development societies and trust as described below.

9. Implementation of CSR through a Company-Owned Development Society

Firm ‘A’ and ‘B’ have their own separate organisation (development societies) that is responsible for implementing large scale community development programs of these firms. The society employs a variety of people depending upon the type of projects it handles, including specialists in social issues, agriculture, and rural development activities. There are two advantages in this approach. First, it helps in implementing community development programs that are intended to be converted into long-term sustainable CSR projects. Such projects are possible because this approach relies on community participation, resulting in ownership of the project by the community leading to a long-term sustainable project. Second, firms get an opportunity to engage in regular CSR programs because of the society provides an appropriate organisational structure and a dedicated set of people to carry out CSR implementation work.

This evidence suggests that, though in firms ‘A’ and ‘B’, a culture of sustainability is more dominant, market orientation is also present. Figure 1 depicts the dominance and varying degree of type of corporate culture present in sample agribusiness firms in emerging markets.

The result shows that firms ‘A’ and ‘B’ actively engage in CSR programs irrespective of any pressure from stakeholder or media, i.e., ‘proactive CSR’ (Du et al. 2010). Stakeholders typically perceive proactive CSR positively (Becker-Olsen et al. 2006). Therefore, it can be concluded that firms possessing strong culture of sustainability can be expected to incorporate proactive CSR in emerging markets. The findings also highlight that when CSR practices become part of corporate culture then firm engage in regular CSR activities without any pressure from the stakeholders and such firms will generally practice proactive CSR.

Research Proposition 2.

Firm in emerging market possessing culture of sustainability are more likely to pursue proactive CSR programs and incorporate CSR in their corporate strategy.

10. How CSR Implementation Inculcates Sustainability Culture?

The evidence indicates that firms ‘A’ and ‘B’ not only have great concerns about environmental sustainability issues but also have conducive atmosphere to promote CSR activities. One such indicator of the existence of the culture of sustainability is the degree of volunteerism being present in the organisation (

Table 2. Evidence of volunteerism as a part of organisational culture.

Firm	Exemplary Quotes on Volunteerism
A	‘Regular communications are made and volunteers are encouraged to participate in CSR programs. So it is like if I am agriculture expert and if there is some agricultural program as part of CSR program, I spend my Saturday and Sunday and go there try and communicate with farmers and benefit them. That type of thing is encouraged within the company and it is also recognised.’
	‘When Uttrakhand tragedy happened last year, even I gave my name that in terms of re-establishing the agriculture and there is a need if I could be of help’. ‘Company offices have several special interest clubs, wherein employees sharing common passions and interests, get together and take the lead in planning activities around their area of interest’. ‘Encouragement in the sense that you will get letter of appreciation from MD or HR letter that kind of thing’
B	‘Some people get opportunity to go and work there, so certainly it is recognized at the time of appraisals, but there is no direct linkage with money. If I say that I have attended 100 days or CSR programs enhance I should get this much money. No! It is not in our goal! Because the goal sheet has the goals which are only business related. There is no CSR related goals otherwise the purpose of volunteerism will get defeated’.
	‘Few people are involved in the activity. Especially unit head, departmental heads they are engaged. HR department is engaged everywhere. Safety department is involved’.

). Results indicate that the volunteerism is present in a higher degree in firm ‘A’ than ‘B’. These firms have strong culture of employee volunteerism for CSR and environmental sustainability activities.

Some firms encourage employee volunteerism to implement small scale CSR activates like eye check-up camp, blood donation camp, health check-up camp, animal health check-up camp, conducting farmer’s training programs, etc.

‘Volunteerism’ is a choice for employee to do social work without bothering about any reward. The word volunteering implies commitment of time and energy, for the benefit of society and the community, the environment, or individuals outside one’s immediate family. It is undertaken freely and by choice, without concern for financial gain. It’s all about to make a positive impact in the workplace, community, and environment.

(Associate Vice President, Corporate Affairs of Firm ‘A’)

The other indicator of culture of sustainability is evident in performance appraisal of employee when people are recognized and awarded on various forum and receive public recognition. In firm ‘A’, the employee performance is also linked with his/her contribution in CSR indicating a high level of employee involvement. In firm ‘B’ even though CSR may not be direct component of employee goal sheet of all departments, still it gets some weightage. However, in some places/departments such as manufacturing units, CSR is an essential component of employee goal sheet. Thus, firms ‘A’ and ‘B’ have strong commitment to CSR.

Your [Manager’s] performance is in fact linked to CSR. It may not be very much, but it is part of that. It means that there is very much high level of involvement.

(AGM, Sales and Marketing, Firm ‘A’)

Performance of the employee however and it is not part of the goal sheet. But in some places/departments like in manufacturing units these are part of their goal sheet. There is a weight age of CSR in the goal sheet.

(CSR Manager of Firm ‘B’)

Even in the goal sheet there is a section that you will do CSR activities voluntarily. So that kind of commitment is there.

(HR Manager, Firm ‘A’)

The above evidences substantiate that when firms engage in proactive CSR practices then it helps to inculcate a culture within the organisation which promotes employee volunteerism and recognition of employee during performance appraisal. This culture of sustainability is conducive for carrying out CSR and sustainability activities. This is a win-win kind of situation because the company gets support, expands its business, and runs its manufacturing plant without any hassles, while the community is benefitted by CSR activities as their lifestyle improves and income generation activities increases. This process results in better stakeholder management and satisfaction which in turn strengthens the economic sustainability in the long run.

Research Proposition 3.

Proactive CSR implementation inculcates a culture of sustainability (characterized by employee voluntarism and recognition of employee during their performance appraisal), that strengthens the economic sustainability of firms.

11. Factors for Different Type of Corporate Culture

In above findings (Summarized in

Table 3. Comparative analysis of sample firms and summary of findings.

Sr. No	Key Findings	Firm A and B	Firm C and D
1	Market orientation/Culture of sustainability and CSR implementation	- Culture of sustainability dominant - CSR beyond legal obligation - Regular and proactive CSR - CSR embedded in corporate strategy - Focused on long term economic sustainability - Adequate fund available for CSR	- Market Orientation dominant - CSR to meet legal obligations - Irregular and reactive CSR programs - CSR not embedded in corporate strategy - Focused on reducing cost of operation - Less fund available for CSR implementation
2	CSR implementation approach	- Through firm’s owned development society and trust	- Partnering with NGOs and Industrial association
3	Partnering with NGOs	- When the CSR activity demands expertise beyond firms’ capability	- Due to lack of specialized manpower
4	Collaboration with industrial associations	- To build brand image	- Sharing of cost with other firms - To build brand image
4	Implementation of CSR through a company-owned development society	- Proactive CSR - Large scale CSR - Impact measurement possible	No company owned society/trust to implement CSR
5	Factors prompting firms to adopt different culture	- Nature of firm’s business - Commitment towards community development	- Pressure on profitability
5.a	Nature of firm’s business	- Environmentally hazardous	- Relatively environmentally safe
5.b	Sensitivity, and commitment towards sustainable development	- Expressed more clearly in mission statements	- Not expressed clearly in mission statements
5.c	Pressure on profitability	- Less	- More
5.d	Employee volunteerism	- Employee recognition - CSR as a part of performance appraisal - Standard policy for employee volunteerism	- Occasional employee recognition - No standardized policy for employee volunteerism

), it may also be noted that a number of key factors were identified that allowed to broadly categorise agribusiness firms into sustainability dominant, market dominant and sustainability-market mixed corporate culture. To put it in perspective, these factors are:

(i) Nature of a firm’s business—For deeper insights, the characteristics and nature of business of these firms should be noticed. Firm ’A’ deals mainly in chemical and fertiliser which is much more susceptible to environmental controversies. Firm ‘B’ relies heavily on natural and forest products for its resource sustainability. In order to fulfil firm’s self-interest, the role of CSR increases in both cases. Therefore, firms ‘A’ and ‘B’ go beyond legal compliance in pursuance of CSR. In turn, Firm ‘C’ is environmentally safe, and firm ‘D’ and ‘C’ operate on a low profit margin. Thus, it can be inferred that firms that are environmentally safe or operate on low profit margin are less likely to pursue CSR beyond legal compliance. It is interesting to note that views of managers of firm’s C and D are in contrast with the views expressed by managers of firm ‘A’ and ‘B’ who consider CSR as critical for existence.

If a firm is environmentally unsafe (fertilizer, pesticides etc.), it is likely that they will be dominant on culture of sustainability. On the other hand, if a firm’s nature of business is environmentally less hazardous (such as agri-retail, farm mechanization and tractor etc.), then this type of firm may be less dominant on culture of sustainability.

(ii) Sensitivity, and commitment towards sustainable development—Firms ‘A’ and ‘B’ mission statement clearly expresses their commitment to sustainable development. The findings of the study indicate that these firms practice their commitment to sustainable development and sensitive towards community need. These firms are dominant on culture of sustainability.

(iii) Pressure on profitability—Firms with pressure on profitability are likely to be dominant on market orientation as explained in the Section 7.

The identification of these factors in this research may provide important guidelines to individual firms in drawing their own firm specific CSR-corporate culture framework as part of corporate CSR strategy. This is a significant contribution to the extant literature.

12. Discussion and Conclusions

The empirical study lays foundation for exploring sustainability issues in the context of emerging markets by focusing on the type of corporate culture a firm is possessing. This study specifically explores how market orientation or a culture of sustainability in emerging markets affects CSR implementation or vice versa. This research encourages investigating the corporate culture in a more elaborate way to establish corporate culture-CSR relations. The study contributes to CSR and business ethics literature by diverting the attention from linking CSR with financial performance to linking CSR with corporate culture indicators, which is not only core to the organisation, but also provides a long-term perspective for firms to be successful. Results of this study reveal that the analysis of CSR activities requires the pursuit of a holistic approach that allows identifying how CSR is really implemented by firms. By analysing why, how, and in which context agribusiness firms’ practice CSR, this study provides a fertile ground for a new line of inquiry into the analysis of such activities.

Contrary to the views expressed by some authors (Eccles et al. 2012), this study establishes that firms in emerging market possess both culture of sustainability and market orientation within the same organisation to a varying degree. This has implications for CSR practices of agribusiness firms. Regular CSR activities are practiced in firms in which the culture of sustainability prevails whereas firms with dominant market orientation adopt CSR on an ad hoc basis. An impromptu attitude to CSR is particularly dangerous because it might backfire and undermine trust in the firm. Firms that possess strong culture of sustainability may possess a strong market orientation as well, but firms, in which the market orientation prevails, generally have a weak culture of sustainability. It has been found that firms with a weak culture of sustainability are generally inefficient, struggling to reduce manpower costs and manage losses. By comparing the two sets of organisations, this study induces the troubled firms towards embracing a culture of sustainability for gaining a long-term benefit and economic sustainability (Bertels et al. 2010; Brocchi 2010). However, a detailed scrutiny of the financial implications on the firm could be an interesting area of research for upcoming researchers.

This research has also important policy implications. First, it recommends firms to follow a structured approach of CSR implementation. Second, it highlights the importance of adopting culture of sustainability for economic sustainability (Eccles et al. 2012). This research disproves the proposition that the CSR should be pursued only by the leading firms and that CSR is only a cost element for firms (Kiessling et al. 2016). On the contrary, the findings suggest that the non-practice of CSR could be a costly proposition for firms because it may result in antagonism, huge public resentment, and opposition to the business. Thus, the study persuades firms to scale up CSR activities for accomplishing strategic benefit. In this context, firms considering CSR only as a cost element have a lesson to learn.

This study also highlights the inter-departmental conflict within market oriented organisations and recommends that firms that have separate CSR and marketing departments should align their activities in order to complement each other and work together. Moreover, the role of marketing professionals in the implementation of CSR activities is highlighted by this research because these professionals are involved with the grassroots of the community and the consumer, and are capable of bringing constructive feedback and suggestions of the community. Therefore, involving marketing professionals in CSR planning and implementation would be a smart step. The integration of CSR demands cultural change driven by senior management and other change agents, who push CSR principles throughout the organization (Lindgreen et al. 2011). This counter intuitive inference responds to the calls of authors who see a major role of only senior managers as CSR change agents who drive CSR principles throughout the organization (Miska et al. 2016; Lindgreen et al. 2011).

There are a number of limitations to this study pointing to interesting avenues for future research. First, exploring the study’s propositions in the context of a single country enabled the analysis to keep any influences exerted by the environment constant, but weakened the generalisability of the results. Due to cultural influences on organisations and on CSR implementation in various countries, an interesting extension of this study could be a cross-country research analysing institutional and cultural influences on the relationship between corporate culture and CSR (Kucharska and Kowalczyk 2019). Such research would assist in testing further the robustness of the prevailing theoretical predictions and investigate whether corporate culture—CSR relation vary in different cultural contexts. Second, the present investigation is based on interview research, which provides limited longitudinal evidence on how firms use CSR practices in their everyday activities. Future studies with access to longitudinal data will be able to address questions concerning temporal changes in CSR implementation and its consequences on corporate culture. Third, in interviews, when data are collected by one individual, individual biases in reporting are bound to exist. Hence, quantitative and other qualitative methods may also be employed to increase the generalisability of the research. Fourth, this research was limited to only very large firms. Drawing on previous research (Cambra-Fierro et al. 2008) which suggests that CSR is less size sensitive than believed, a similar study can be conducted in the context of smaller agribusiness firms. This study supports the notion that in agribusiness, implementing CSR could be an appropriate means to legitimize business activities (Luhmann and Theuvsen 2016). This ‘CSR as a license to operate’ concept can be tested in other sectors that are potentially harmful to environment, such as mining, petrochemicals, energy, and automobile. Further research may be conducted in the context of these sectors to get a holistic picture of corporate culture-CSR relations. Despite the aforementioned limitations, the study’s results are important considering the size and importance of India as an emerging economic power. Moreover, given the fact that data were collected from a single, large country not influential in terms of defining CSR implementation, at least for emerging markets, these results can be expected to hold true for CSR practices across a wide range of developing countries.