The Role of Multinational Companies in Sustainable Socioeconomic Development: The Case of Palestine

Abstract

Aims: Our study investigates different aspects of the Strategic Success Paradigm [1] and examined the relationships among MNCs’ environmental turbulence, MNC strategy aggressiveness, MNC capability responsiveness, and MNC corporate social responsibility (CSR) posture in Palestine. Study Design:  The target population for this research included multinational corporations (MNCs) and domestic Small and Medium Enterprises (SMEs) that had operations in or were contemplating undertaking foreign direct investment (FDI) in Palestine. An online survey data used and the results by using Spearman’s rho, there are statistically significant relationship between MNC CSR posture and MNC financial performance; between MNC CSR posture and MNC social performance and   between MNC financial performance and MNC social performance in Palestine. Methodology: The methodology for this research study was based on the Strategic Success Paradigm presented [2]. This methodology was operationalized in this study through the relationship between MNC environmental turbulence (ET), MNC strategy aggressiveness (SA), and MNC capability responsiveness (CR). Specifically, the study hypothesized that organizational performance was improved when MNC strategy aggressiveness, MNC capability responsiveness, and MNC CSR strategic posture were aligned with MNC issue turbulence.  As part of the MNC’s strategy, CSR was considered an integral part of the overall core business strategy to optimize economic and social performance for companies operating in Palestine. Results: This study provides practical implication to researchers and professionals with tools for aligning the business environment with the political environment and for maximizing stakeholder legitimacy strategy and CSR for optimal financial and social performance. Conclusion: Our study findings contributes to the field of strategic management by empirically testing and validating hypotheses regarding the relationships between environmental turbulence, MNC strategy aggressiveness, and MNC capability responsiveness for MNCs operating in a conflict-prone zone such as Palestine.