TITLE:
The Implications of Mandatory Corporate Social Responsibility—A Literature Review Perspective
AUTHORS:
Dinesh Ramdhony
KEYWORDS:
Mauritius, Mandatory, CSR Levy, Public Interest Theory
JOURNAL NAME:
Theoretical Economics Letters,
Vol.8 No.3,
February
13,
2018
ABSTRACT: The purpose of this paper is
to discuss the implications of mandatory corporate social responsibility (CSR)
contributions: the CSR levy. Using public interest theory as the theoretical
lens, this paper adopts a pro-regulation approach and justifies the
introduction of the CSR levy in Mauritius, based on the economic and business
environment prevailing at the time. Secondary literature sources are used to
investigate. Two further questions related to mandatory CSR are investigated:
Does the CSR levy result in a competitive disadvantage? Does the CSR levy
reduce profits? We conclude that the CSR levy does not disadvantage firms due
to the uniform amount and its universal application. Furthermore, it can
attract Foreign Direct Investment (FDI) and Socially Responsible Investment
(SRI). However, the CSR levy does negatively impact on profits but has the
potential to pay higher returns in the future if viewed as an investment. This
research needs to be complemented by studies that empirically investigate the
impacts of the CSR levy on companies and sectors in Mauritius.