Hofstede's Cultural Dimension

Introduction

CSR (Corporate Social Responsibility) standard is always problematic to define. As an approach to manage the variation between organizational behaviors, social values, and community’s expectations, CSR works a tool for strategic issues management. It also becomes a theoretical basis for a company to develop a harmonious relationship with the community (Community Development). Therefore, CSR is the moral responsibility that a company has to conduct for its strategic stakeholders, especially for the community around the operational areas. It is the commitment of a company to account for the impact of its operation in social, economic, and environmental dimensions (Achda, 2006).

As one factor that frames CSR, culture becomes one

The studies reveal that expectation of CSR are shaped by the local culture, which implies the corporations to pay attention upon the various stakeholders in a different way depending on the culture where the firm is operating.

Hoftstede’s Cultural Dimension of Indonesia

From “An Analysis Of National Culture And Leadership Practices In Indonesia,” by D. W. Irawanto, 2009, Journal of Diversity Management, p.43.

As can be seen from the above table of Hofstede study and GLOBE Project research in 1991, the score of Indonesian’s cultural dimensions is generally below the average of other Asians nations, which is contradicting the perception of Asian people who are sharing the similar values. Scores level of Indonesia on Power Distance, Individualism, Masculinity and Uncertainty Avoidance are low compared to the Asian’s nation

From the figure above, we can see that ethical responsibility has been placed in the bottom of the pyramid to represent the foundation for CSR performance in Indonesia due to the importance of cultural values. Ethical norms, as well as religious beliefs, have seen as one of the most complex issues for a company performing CSR in Indonesia. Without taking ethics in consideration, a company will probably face difficulties when conducting business and performing CSR. In the middle of the pyramid, legal and economical responsibilities are placed. Economic responsibility definitely acts as a motives driver in holding a CSR action. However, due to the fact that companies must also obey the law of CSR practices, both economic and legal responsibilities are placed next to each other. The last responsibility, philanthropic, is in the top of the pyramid since it can be seen as the least important responsibilities and only conducted by larger companies. Philanthropic responsibility in Indonesia is not equal to developed countries, due to the social and cultural circumstances. While developed countries base their CSR on taxes and individual commitment, Indonesia base their CSR on particular activity, mainly for mass poverty, and is not entirely ready to be a national