Bolivia’s CSR Prospects Within Extractive and Manufacturing Sectors
The introduction of Corporate Social Responsibility, particularly those found within the global south’s extractive and manufacturing sectors, have been met with political and transnational firm apathy through its failed initial attempts to establish CSR through social licenses. Nevertheless, with the prompt unraveling of its heightened disregard for negative human and environmental implications voiced by civil society organizations (CSOs), CSR frameworks have voluntarily, or by form of societal pressure, become increasingly appealing to multinational corporations (MNCs) across the globe. Such is the case of Bolivia, where accountability measures found within CSR systems reach an impasse due to its inherent lack of transparency in transactions and widespread corruption networks across governmental branches. Nevertheless, global agendas pushed by intergovernmental organizations have had significant impact when informing, incentivizing, and cooperating with MNCs to promote sustainable development, such as the United Nation’s recent 17 Sustainable Development Goals (SDGs), Global Compact, and Guiding Principles on Business and Human Rights. Academic emphases increasingly stress the imperative role that CSOs have in holding MNCs accountable for their human and environmental impacts by demanding the necessary conditions for a successful self-sustainable process to be implemented through respected feedback loops.
CSR adoption has proven to leverage intangible capabilities to consumers, more specifically within the grocery store and soft drink department. These include, but are not limited to, increased access to information, comprehension of client concerns, development of eco-friendly systems, facilitation of recycling procedures, advanced technological assimilation, and low purchase risk from products that lack transparency. Ultimately, adopting CSRs is appealing to consumers as it signals a business’ willingness to not only invest in its brand and its workers from all ranks, but also the desire leverage future benefits for its customers, society, and the environment at large at the expense of a chosen reform’s cost. These reforms are proven to have high financial returns in the long-run by affecting customers’ levels of satisfaction and loyalty. Nevertheless, in areas where customers have limited budgets and do not have the luxury of purchasing more ethically and sustainably produced products, the marketing tools that CSR provide cannot be accessed and, in turn, disincentivize corporate structures to reform. This is the case of Bolivia, where blue collar worker’s social licenses are jeopardized as the assumed institutional responsibilities primarily held in the global north that guarantee a reasonable level of citizen participation are inexistent. This is especially true for extractive sectors, where mining centers in Potosi and Oruro maintain worrisome levels of poverty and inequality intergenerationally.
Ultimately, the incentive leverage that customer consciousness and satisfaction has in MNCs decision making process to adopt CSR methods varies across the good governance assumptions between the global north and south. Taking Bolivia as an extreme synecdoche of the global south’s MNC experience within extractive and manufacturing sectors, the lack of funding and acknowledgement of independent CSOs and grassroot movements correlates with a failure to politically legitimize its citizens interests regarding human and environmental rights. Within the two Bolivian manufacturing industries mentioned above, translating customer satisfaction into three key CSR categories, them being recycling convenience, eco-friendly practices, and ethical behavior, is proven to gradually increase its customer loyalty and, hence, its long-term profitability. Within its extractive sector, CSOs have the option to connect themselves with Intergovernmental Organizations informational platforms, such as the Inter-American Development Bank, or Transnational Advocacy Networks (TANs) to legitimize their claims on a regional scale and pressure local government officials to adopt clearer terms of engagement with MNCs operational execution.
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