The impact of corporate venture capital on CSR outcomes in BRICS countries

Abstract

Growth of economies in the BRICS nations (Brazil, Russia, India, China and South Africa) are estimated to outpace that of developed nations by 2050. However this comes at a high cost of energy consumption which is in contrast with global sustainability and Corporate Social Responsibility (CSR) goals. New forms of open innovation such as Corporate Venture Capital (CVC) programmes may offer solutions to persistent CSR challenges. However, there is a lack of research at the intersection of CSR outcomes and CVC programmes, especially outside of developed markets. This study addressed the gap by investigating if CVC programmes are effective at improving CSR outcomes of firms in BRICS nations. A multiple regression analysis was conducted on the environmental and social components of CSR for 171 companies in India and South Africa. The results show that CVC programmes positively impact companies’ social outcomes but has no immediate impact on its environmental outcomes. The study further contributes to the literature by demonstrating that the environmental and social outcomes have significant impacts on each other. Additional contributions include proving that governance scores influence the social outcomes and that the industry type has an impact on the environmental scores. However, firm location has no impact on the environmental or social outcomes in this study.