Corporate Social Responsibility in Low and Middle Income Countries: Who Benefits, Who Loses, and Why?

Abstract

Over recent decades, Corporate Social Responsibility (CSR) has become increasingly integrated into business strategies in Low- and Middle-Income Countries (LMICs), with stakeholders, including governments, promoting initiatives such as community awareness and capacity building to enhance sustainable development. Despite widespread adoption, particularly in extractive industries, the impacts of CSR remain underexplored and contested. This study employs a systematic literature review and meta-analysis of 52 peer-reviewed articles (2000–2024), identified using search terms including “CSR benefits,” “CSR determinants,” “CSR history,” and “CSR impact on development.” Inferential statistics reveal a moderate positive effect of CSR on community welfare (Hedges’ g = 0.48, 95% CI [0.27, 0.69], p < 0.001), yet significant disparities persist, with marginalized groups benefiting less (β = -0.31, p = 0.03). Heterogeneity in outcomes is notable (I² = 72%, p < 0.01), particularly in extractive industries, where CSR engagement is high (OR = 1.9, 95% CI [1.3, 2.8]) but constrained by weak regulatory frameworks (p = 0.002). Findings highlight two contrasting perspectives: CSR as a catalyst for mutual gains versus a driver of inequitable outcomes. We recommend that governments strengthen regulatory oversight and promote inclusive CSR frameworks to enhance societal benefits. This study advances the understanding of CSR’s role in fostering equitable development in LMICs.