Corporate social responsibility political interaction strategy: A case study

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Abstract

This research analyzes the corporate social responsibility (CSR) and political interaction strategy used by PT. Indah Kiat Pulp & Paper Tbk (IKPP) in Riau Province, Indonesia. The theory used in this study is that of den Hond et al. (2014), who introduced six CSR political interaction strategies: a) information and messages, b) financial incentives, c) constituency building, d) legal strategy, e) substitute policy, and f) fragmentation and destabilization of opponents. This is a qualitative study with data collected through interviews and the annual reports on the stock exchange of Indonesian companies. Using cluster analysis, this study investigates the degree of correlation between political actors and companies. Furthermore, the NVivo 12 software strengthened the actors built into the CSR political interaction strategy. Results showed that the constituency development strategy is the strongest of the five other political interactions. A constituency-building strategy implies that companies seek to build relationships with multiple stakeholders when addressing political issues. Building relationships with the community, policymakers, and key opinion leaders while engaging with the media is the company’s political interaction strategy for constituency development. Findings also reveal that of the four constituency development strategies in this company, interaction with the community was the strongest relationship built to support political interaction and CSR.

Keywords: Political Interaction Strategy, Corporate Political Activity, Corporate Social Responsibility, Policy

Authors’ individual contribution: Conceptualization — M.D.W.; Methodology — B.I.P.; Investigation — M.D.W. and B.I.P.; Resources — B.I.P.; Writing — M.D.W.; Supervision — M.D.W.; Funding Acquisition — M.D.W. and B.I.P.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: P0, O1, O20

Received: 29.10.2022
Accepted: 31.07.2023
Published online: 01.08.2023

How to cite this paper: Wedayanti, M. D., & Pulungan, B. I. (2023). Corporate social responsibility political interaction strategy: A case study. Corporate & Business Strategy Review, 4(3), 56–65. https://doi.org/10.22495/cbsrv4i3art6