Social Responsibility Journal

Corporate social responsibility: a study of Kazakhstan corporate sector

Rajasekhara Mouly Potluri Yespayeva Batima Kunev Madiyar
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Rajasekhara Mouly Potluri Yespayeva Batima Kunev Madiyar, (2010),"Corporate social responsibility: a study of Kazakhstan corporate
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 Corporate social responsibility: a study of
Kazakhstan corporate sector
Rajasekhara Mouly Potluri, Yespayeva Batima and Kunev Madiyar

Rajasekhara Mouly Potluri, Abstract

Yespayeva Batima, and Purpose – The main purpose of this research is to know the attitudinal displays of Kazakhstan
Kunev Madiyar are all companies towards corporate social responsibility. Apart from this, the paper also seeks to analyze the
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based at the Faculty of opinions of Kazakh employees, customers and the general public about their companies’ socially
Economics and Finance, responsible actions.
Department of Economics Design/methodology/approach – After a thorough revision of the relevant literature on corporate social
and Management, responsibility, through well structured questionnaires and informal personal interviews with 50 Kazakh
Kazakh-British Technical companies from both manufacturing and service sectors’ concerned officials, the study analyzed CSR
towards Kazakh owners or shareholders, employees, customers, creditors and suppliers, general
University, Almaty,
public or community at large and government. To cross-validate, the paper also carried out a separate
Kazakhstan.
survey to collect the opinions of 100 employees, 100 customers, and 100 members of the general
public. These collected data were analyzed by using SPSS and Microsoft Excel software packages.
Findings – Kazakhstan companies conveyed a difference of opinion in almost every stakeholder area
because of the present day economic crunch. Related to consumers, only 68 percent of companies
recognized the provision of effective after-sales service and 62 percent only promised to extend
courteous service. Most importantly, only 58 percent of the Kazakh business community acknowledged
following a fair trade policy. Related to the cross-validation part, a meagre 8.57 percent of employees
were not content with companies’ policies, 12.86 percent of customers thought they were exploited and
another 11.20 percent of the general public were not pleased with the social actions of Kazakh
companies.
Practical implications – The study presents required information relating to Kazakhstan companies
about the expectations of different stakeholders regarding revising their existing plans, policies,
strategies and programs for maintaining healthy and affable relations.
Originality/value – The research paper provides a strong information base for both Kazakh companies
and academicians to understand the various expectations of all the key interest groups in general and
employees, customers and the general public in particular.
Keywords Corporate image, Social responsibility, Kazakhstan, Employees, Customers
Paper type Research paper

Introduction
The concept of corporate social responsibility is receiving spectacular attention in recent
years both from the business practitioners as well as academicians in different parts of the
world, and there is no exception from the Central Asian countries to this phenomenon. These
countries newly born in the last decade are rapidly bringing in the latest and most successful
management practices from different parts of the world. Managers in today’s business world
increasingly need to be aware of two separate but interrelated concerns – business ethics
and social responsibility. In this process, the introduction of corporate social responsibility
concept in their business plans is heavily increasing after clear-cut observation of the
benefits accruing from this along with changing attitudes of consumers towards companies
which are socially conscious. There are myriad ambiguities here such as there is no
consensus on what constitutes virtuous corporate behavior. Is sourcing overseas to take

DOI 10.1108/17471111011024531 VOL. 6 NO. 1 2010, pp. 33-44, Q Emerald Group Publishing Limited, ISSN 1747-1117 j SOCIAL RESPONSIBILITY JOURNAL j PAGE 33
 advantage of lower labor costs responsible? Are companies morally obligated to insist that
their contractors pay a ‘‘living wage’’ rather than market wages? Are investments in natural
resources in poor countries with corrupt governments always, sometimes or never
irresponsible? More broadly, is it ever responsible for companies to use their shareholders’
resources to provide public goods if doing so make them less profitable? Or are
corporations acting more responsibly when they seek to maximize shareholder wealth?
(Vogel, 2005). Even in this kind of perplexing situation both business practitioners and the
majority of stakeholders clearly identified the essence of socially responsible actions from
the business community because of reciprocal benefits they receive from each other. In this
juncture, Kazakhstan corporate sector is also better to imperatively be acquainted with their
stakeholders’ interests on their social actions to inculcate positive image in order to stay alive
and also to enjoy the growth in business. This study attempts to provide concrete information
about corporate social responsibility in Kazakhstan both to the industry as well as to
academia to identify and review their existing social actions efficacy and to also provide a
strong base to the future research for the academicians in the country.
Kazakhstan, officially the Republic of Kazakhstan, is a large Eurasian country which is
located in Central Asia, northwest of China; a small portion west of the Ural River in
eastern-most Europe[1]. It is the ninth largest country in the world as well as the world’s
largest landlocked country. Kazakhstan declared itself an independent country on
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December 16, 1991, the last Soviet republic to do so. Its communist-era leader, H.E.
Nursultan Nazarbayev, became the country’s new President. Since independence,
Kazakhstan has pursued a balanced foreign policy and worked to develop its economy,
especially its hydrocarbon industry. It is now considered to be the dominant state in Central
Asia.
Kazakhstan is ethnically and culturally diverse, in part due to mass deportations of many
ethnic groups to the country during Stalin’s rule. Kazakhs are the largest group, followed by
Russians. Kazakhstan allows freedom of religion, and many different beliefs are represented
in the country. Islam is the primary religion, followed by Orthodox Christianity. The official
language is Kazakh, though Russian is still commonly used for everyday communication.
The government of Kazakhstan plans to triple its gross domestic product (GDP) by 2015 as
compared to 2000. GDP growth has been stable in the last five years, at a rate higher than 9
percent. Buoyed by high world crude oil prices, GDP growth figures were in 2000, 2001,
2002, 2003, 2004, and 2005: 9.8, 13.2, 9.5, 9.2, 9.4, and 9.2 percent, respectively. Other
major exports of Kazakhstan include wheat, textile, and livestock. Kazakhstan forecasts that
it will become the world’s leading exporter of uranium by the year 2010. Energy is the leading
economic sector[2].

Kazakhstan and CSR

Even though some organizations and associations studied on CSR in this Eurasian country,
up to now there is no extensive survey to know the attitudinal displays of Kazakh corporate
sector towards majority of the stakeholders’ viz. shareholders, employees, customers,
creditors and suppliers, government and general public at a time. At the same time, no study
tries to know the opinions of any stakeholders in the country about the social actions of their
corporate sector. According to Mallen (2005), 81 percent of private firms, 49 percent of state
firms and 89 percent of foreign-owned firms agreed that they were familiar with the term
’corporate social responsibility’. This in itself showed the remarkable degree of penetration
the basic language has made in this business environment, with rather little difference
between local and international private companies. However, when it comes to practice, the
picture changes completely, only 53 percent of the private companies said they had a CSR
policy (21 percent for state companies, 71 percent for international). These numbers
dropped to 35, 12 and 47 percent respectively when asked if the policy was accessible. So
many organizations, associations with the support of government constantly are conducting
a lot of activity to enhance the awareness about CSR in the country by arranging seminars,
workshops etc. In this process, in the month of October 2008, the American Chamber of
Commerce, with support from Eurasia Foundation of Central Asia (EFCA), the Ministry of

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PAGE 34 SOCIAL RESPONSIBILITY JOURNAL VOL. 6 NO. 1 2010
 Industry and Trade of Kazakhstan and the Kazakhstan Press Club, held training on ‘‘CSR in
Kazakhstan – The Role of Government and Media’’ for journalists of regional mass media
and representatives of key ministries. The goal of the training was to improve the quality of
CSR coverage in the media and to strengthen the role of CSR in Kazakhstan. Patricia
Graham, Director of Public Affairs and Government Relations of Exxon Mobil Kazakhstan
Inc., said:
Corporate citizenship means factoring in environmental, social, health and safety concerns into
operational and business decisions, excelling in safety, health and environmental performance.
Socially responsible companies should adhere to the highest standards of business conduct,
develop and value the workforce and support the communities in which they operate (EFCA,
2008).

Many domestic companies till now have not found out for themselves, to create a place for
the concept of ‘‘the corporate and social responsibility of business’’. The reasons for slow
development of the social responsibility of business in Kazakhstan – high political
interference and the imperfect legislation, lack of knowledge and complexity of the CSR
concept. Even in economically developed countries companies do not always come to one
opinion regarding the understanding of social actions of business (Danaeva, 2004).
Business dealing under international standards assumes knowledge of the concept
corporate social responsibility. Various researchers differently interpret this term. However,
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the basic components of this concept are constant. It is full and duly payment of taxes,
preservation and creation of new workplaces, maintenance of the rights and protection of
workers, granting of social guarantees to workers, genuine compensation package, and
employment of young employees[3]. In the words of Mr Arman Abdykalykov, Vice President,
Public Affairs and Government Relations of Petro-Kazakhstan:
CSR is a complex and diverse term representing business standards focusing on the long-term
nature of business itself and increasing value for shareholders. Corporate social responsibility is
not just an abstract concept but a business standard that we follow in our everyday activities. The
observance of CSR principles is a prerogative for all company employees and not only for top
management. This particular style of working gratifies and benefits all parties – the government,
employees and their family members, consumers, local communities and shareholders[4].

Today more and more Kazakhstan people clearly realize that the model of development
based only on the processing of raw resources is unacceptable for the country, which set a
high and ambitious goal before itself to enter the association of the competitive and
successful nations of the modern world. Consonant to the Program of the National
Democratic Party ‘‘Nur Otan’’ the Holding will attempt to maximally address the social
programs and assure they will correspond to the essential needs of the society. The Strategy
of development of the Samghau Holding is closely connected with the economic and
political interests of Kazakhstan. In accordance with the policy of the Head of the state aimed
at the application of international standards of business social responsibility, the Holding will
attempt to correspond to all the modern principles of corporate social responsibility. The
Holding realizes that the long-term success is possible only in conditions of social welfare of
Kazakhstan people, and therefore the main objective of its activity is the assistance to the
social-economic prosperity of Kazakhstan. Creation of foundation for high-tech and
information society in Kazakhstan and acknowledgement of the responsibility for positive
impact of such activity on the quality of life of Kazakhstan people is the main priority of the
Holding policy. The main types of activity of the Holding will have the socially focused result:
the expansion of unobstructed and qualitative access for educational and public healthcare
institutions, social provision, culture, scientific organizations, institutions of social civil to
information, knowledge, information services and technologies. The important task of the
Holding will be participation in realization of the Program on reduction of information
inequality and, in particular, overcoming of digital inequality in rural regions of the country[5].
For HSBC, Kazakhstan, corporate social responsibility (CSR) means managing our business
responsibly and sensitively for long-term success. Our goal is not, and never has been, profit
at any cost because we know that tomorrow’s success depends on the trust we build today.
We look to address the expectations of our customers, shareholders, employees and other
stakeholders[6].

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VOL. 6 NO. 1 2010 SOCIAL RESPONSIBILITY JOURNAL PAGE 35
 Literature review
Most of the stakeholders in this world can use different criteria to judge the performance of
an organization based on stakeholder expectations. All the stakeholders viz., shareholders,
employees, suppliers, customers, communities, competitors, governments, environmental
campaigners, NGOs are anticipating authentic socially responsible actions from every
business house which are operating in the vicinity of that society. This significant change in
observing socially responsible actions of the corporate sector has given extreme pressure to
the managers’ community in designing a set of social activities to satisfy all the stakeholders.
In this way of analyzing, managers can respond to the expectations of different stakeholders
with unique set of ideas and opportunities of socially responsible behavior. Corporate social
responsibility can be defined as the actions of a firm to benefit society beyond the
requirements of the law and the direct interests of the firm (McWilliams and Siegel, 2001).
The concept of social responsibility proposes that a private corporation has responsibilities
to society that extend beyond making a profit. Strategic decisions often affect more than just
the corporation. Such decisions can cause many to question the appropriateness of certain
missions, objectives, and strategies of business corporations. Managers must be able to
deal with these conflicting interests in an ethical manner to formulate a viable strategic plan
(Wheelen and Hunger, 2008).
Corporate social responsibility means at a basic level – that ‘‘corporate activity should be
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motivated in part by a concern for the welfare of some non-owners, and by an underlying
commitment to basic principles such as integrity, fairness and respect for persons’’
(Donaldson, 2005). In a general sense, social responsibility is management’s acceptance of
the obligation to consider profit, consumer satisfaction, and societal well-being of equal
value in evaluating the firm’s performance. It is the recognition that business must be
concerned with the qualitative dimensions of consumer, employee, and societal benefits, as
well as the quantitative measures of sales and profits, by which business performance is
traditionally measured. Businesses may exercise social responsibility because such
behavior is required by law, because it enhances the company’s image, or because
management believes it is the ethical course of action (Kurtz and Boone, 2008).
Organizations cannot ignore the interests and demands of stakeholders such as citizens
and society in general that are beyond its immediate constituencies – customers, owners,
suppliers, and employees. That is, they must consider the needs of the broader community
at large and act in a socially responsible manner (Rowley and Moldoveanu, 2003). Social
responsibility is the expectation that businesses or individuals will strive to improve the
overall welfare of society (Thomas, 2000). Today, demands for greater socially responsible
actions from corporate world have accelerated in every part of the world from all the
stakeholders. There is no exception to these Central-Asian countries to. The reasons include
corporate critics, social investors, activists, and increasingly, customers who claim to assess
corporate responsibility when making purchasing decisions. Such demands go well beyond
product and service quality (Pearce and Doh, 2005).
Four possibilities (Carroll, 1999) like economic, legal, ethical and discretionary
responsibilities are receiving noteworthy attention from the managers’ community. In
fulfilling economic responsibilities, managers’ focuses on serving the economic interests of
the company and its shareholders and take action to sustain that aim, in spite of the effects
on communities or other reflections. Society expects managers to obey the law-by not
releasing all the kinds of pollution, selling defective goods or providing misleading
information to investors by gratifying legal responsibility. In pleasing ethical responsibilities,
business community should include actions that are not specified by law, and may not serve
a company’s narrow economic interests. Managers take these actions because they believe
they meet some wider social interest, such as discouraging tobacco consumption,
protecting the natural environment or supporting a socially disadvantaged group. Finally,
discretionary responsibilities cover actions those are entirely voluntary, not being shaped by
economic, legal or ethical considerations which are including anonymous donations with no
expectation or possibility of a payback, sponsorship of local events and contributions to
charities-the actions are entirely philanthropic. Carroll lists the above four responsibilities in

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PAGE 36 SOCIAL RESPONSIBILITY JOURNAL VOL. 6 NO. 1 2010
 order of priority. A business firm must first make a profit to satisfy its economic
responsibilities. To prolong in survival, the firm must follow the laws, thus gratifying its legal
responsibilities. There is evidence that companies found guilty of violating laws have lower
profits and sales growth after conviction (Baucus and Baucus, 1997). After satisfying both
economic and legal responsibilities, only a firm must look into socially responsible actions. In
the words of Byron (2003), profits are merely a means to an end, not an end in itself. Just as a
person needs food to survive and grow, so does a business corporation need profits to
survive and grow. ‘‘Maximizing profits is like maximizing food.’’ Thus maximization of profits
cannot be the primary obligation of business.
In his efficiency perspective of social responsibility Friedman (1962), Nobel Prize winning
economist more clearly said: In a free economy, there is one and only one social
responsibility of business-to use its resources and engage in activities designed to increase
its profits so long as it stays within the rules of the game, which is to say, engages in open
and free competition, without deception or fraud. As an economist, Friedman believed that
operating business ‘‘without deception or fraud’’ provided sufficient social benefit through
the creation of wealth or employment. He argued that the board of directors in charge of a
business should concentrate on generating wealth for shareholders, and distributing it to
them. Shareholders could then decide if they wished to use that income to support social
causes (Margolis and Walsh, 2003). In most large organizations today, the manager is not
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the owner. The corporate form of organization is featured by the separation of ownership and
control. Managers serve as the agents of the organization’s owners. Within this context,
Friedman argues that managers should ‘‘conduct business in accordance with desires of
owners, which will generally be to make as much money as possible while conforming to the
basic rules of society, both those embodied in law and those embodied in ethical custom’’
(Friedman, 1970; Bagley, 2003). The social responsibility perspective argues that society
grants existence to firms. Shareholders simply supply risk capital. Therefore, firms have
responsibilities and obligations to society as a whole, not just to shareholders. Thus, while
the efficiency perspective states that it is socially responsible to maximize the return to the
shareholder, the social responsibility perspective states that it is socially irresponsible to
maximize only shareholder wealth because shareholders are not the only one responsible for
the firm’s existence. The most common form of corporate existence is one of limited liability-a
privilege granted to corporations by society, not by shareholders (Joha et al., 1991; Handy,
2003). A more recent approach to corporate social responsibility tries to address the
balancing act managers have to engage in when it comes to responding to the concerns of
all the firm’s stakeholders (Porter and Kramer, 2006). Called strategic corporate social
responsibility, it argues that three fundamental criteria can guide managers. The first
criterion takes an ‘‘inside out’’ approach which means managers can look inside the
company at issues that are more rather than less important as a function of the company’s
strategy and business activities. The second criterion takes an ‘‘outside in’’ approach means
managers can look outside the company at issues that the company has an impact on. The
third criterion takes an ‘‘outside out’’ approach means managers should look at social issues
in general in terms of the extent to which they are problematic. In the present day’s highly
vulnerable world, myriad numbers of social issues to consider by the business community
like everything from HIV/AIDS to poverty to literacy to pollution and beyond.
If managers can satisfy stakeholders’ expectations to an acceptable degree, they will retain
their support. As Egan and Wilson (2002) point out, some companies are able to balance
responsibility and corporate success, and that the enlightened shareholder understands
that it is in his or her best long-term interests that the company performs in a way that
satisfies all stakeholders.
Almost all stakeholders have increased pressure for greater attention to CSR has emanated
from the business world particularly in developing countries. These groups have urged both
domestic and MNCs to be more responsive to the range of social needs in developing
countries, including addressing concerns about working conditions in factories or service
centers and attending to the environmental impacts of their activities. Therefore, the
introduction of socially responsible actions to business people is an imperative chore to

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VOL. 6 NO. 1 2010 SOCIAL RESPONSIBILITY JOURNAL PAGE 37
 enjoy the benefits from all the angels and also to augment the optimistic image in the minds
of consumers who are recently more social conscious.

Research methodology
The main intention of this research was to be acquainted with the attitudinal displays of
Kazakhstan companies towards corporate social responsibility and also to spot-out the
views of employees, customers and general public on socially responsible actions of
Kazakh corporate sector. Due to the wide geographical exposure, the span of the research
was limited to fifty Kazakh state and private manufacturing and service companies from the
sectors of telecommunications, banking and insurance, oil and gas, manufacturing, retailing
and civil aviation. A total of four types of questionnaires were used to collect the information
from Kazakh companies, customers, employees and general public along with informal
personal interviews with concerned respondents.

Sample structure and limitations

The researchers selected only fifty companies which are operating in and around the
country’s second largest industrial capital city Almaty which were selected based on the
propinquity and the appointments available from the concerned officials for the collection of
information. Related to cross validate part, a random sampling technique was used to select
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a sample of 100 employees, 100 customers and another 100 general public from the
stratified population. The respondents were chosen randomly to provide a stratified sample
from the state and private sector companies selected from the industries of
telecommunications, banking and insurance, oil and gas, manufacturing, retailing and
civil aviation. The core limitation for this research study was the number of companies limited
to fifty from the Almaty region. The study was also limited only to collect the views of
employees, customers and the general publics to cross validate the opinions of Kazakh
companies towards their socially responsible actions.

Data collection
The researchers used four types of questionnaires each one for companies, employees,
customers and general public. To know the attitudes of Kazakh companies about their social
actions, the researchers administered a lengthy questionnaire with a total of 33 questions
that were mostly closed-ended along with informal personal interviews. And the researchers
collected the views of employees, customers and general public with another three
self-administered Russian and Kazakh language questionnaires as well as personal
interviews. The method of data collection was convenience type. Questionnaires were
distributed physically to only willing employees, customers and the general public and
collected then and there within the shortest possible time.

Data analysis
Collected data by using the four types of questionnaires targeted to Kazakhstan companies,
employees, customers and general public was analyzed based on the reliability with
research questions, objective of the study, thoughtful and judgments of the researchers. The
collected data was reviewed, coded and manipulated by using Statistical Package for
Social Scientists (SPSS) and Microsoft Excel as data analysis tools. The findings from
personal interviews conducted with the concerned company officials related to first
questionnaire detected difference of opinion in 23 questions in shareholders, employees,
customers, creditors and suppliers, general public and government areas. Only for ten
questions related to different stakeholders, Kazakh companies expressed positive attitude.
The remaining three questionnaires were targeted to employees, customers and the general
public. The researchers presented the data in the tabular form.

Findings and discussion

The main questionnaire targeted to Kazakhstan companies with thirty three questions
related to different stakeholders’ viz. shareholders, employees, customers, creditors and

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PAGE 38 SOCIAL RESPONSIBILITY JOURNAL VOL. 6 NO. 1 2010
 suppliers, general public and government observed difference of opinion in twenty three
areas and for ten questions constructive opinion from Kazakh corporate sector in
implementing socially responsible actions (see Table I).
Out of 50 Kazakhstan companies, 87.5 percent expressed affirmative socially responsible
actions towards their owners or shareholders and the remaining 12.5 percent whispered that
it is not possible at all times to satisfy this stakeholder community particularly areas related to
fair and regular return on investment, safe and steady appreciation of investments and
reasonable representation to minority shareholders to business management areas. This is
due to Kazakh companies facing severe competition, escalating economic crunch and lack
of knowledge in business management. Related to employees, 88.33 percent Kazakh
companies were positive enough in protecting their employee rights by providing all the
basic requirements for them and 11.67 percent said difference of opinion on fair wages,
representation to decision making bodies, personal advancement, providing freedom and
job satisfaction and humane treatment. They strongly agreed on and providing concrete
security of employment and claim to make available safe and secure working conditions to
their employee community. Out of 50 Kazakhstan employers, 92.22 percent uttered their
difference of opinion on social actions towards customers except to provide goods and
services according to the needs, tastes and preferences of different classes of customers. In
the areas like supply of goods at reasonable prices; inform and educate the customers;
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honest and truthful in advertising; providing efficient after sales service; extend a hearty and
courteous service; and avoid unhealthy trade practices, Kazakh business community
expressed their absolute opinion in an unenthusiastic way because of some reasons like
heavy transportation costs, increasing trend of remaining business operating costs, lack of
sound technical personnel to offer effective after-sales service, and the influence of local
business practices which are mainly profit oriented etc.
Connected to creditors and suppliers, only 8.82 percent employers expressed their negative
opinion on two important issues like reasonable price for the supplies, prompt repayments
and fairness in transactions; and developing healthy atmosphere where creditors, suppliers
and other interest groups are treated as partners in a cooperative endeavor. And the
remaining 91.18 percent of employers expressed strong belief in maintaining cordial
relations with both creditors and suppliers. Related to general public or community at large,
93.42 percent businesses in this Central-Asian country were in favor of socially responsible
actions to satisfy this most influential stakeholder. Only meager 6.58 percent business
houses said about their pessimistic views on proper and effective utilization of natural
resources and also to generate indirect self-employment opportunities; maintain a healthy
environment free from all sorts of pollution; and contributions to community development and
public utility services because of low profitability, the increasing trend of both organized and
unorganized competition, appreciation in business operating costs etc. Associated to the
final and most influential stakeholder Government, 89.06 percent of Kazakhstan companies
uttered strongly about their willingness to introduce socially responsible actions related to
following faithfully all the laws governing regulation of business; avoiding political lobbying
and also ready to provide all kinds of contributions to the socio-economic growth and goals
of the nation. Only 10.94 percent of business people whispered in a discontentment with
regard to following the actions like paying taxes regularly and correctly; fair trade policy and
control the unhealthy business practices and also providing their supportive hand in tackling
the problems of unemployment, poverty and inflation etc.
This means based on the extensive information collected with the support of questionnaires
and personal interviews about the attitudes of Kazakhstan companies views on their socially
responsible actions, they are very sure about the implementation of these to influence
different stakeholders. However, they are now highlighting the present day’s economic
situation which is not conducive to their business existence. On one side struggling to
survive in the highly competitive business, it is not possible even to think about social actions
or doing business with legitimate practices. However, they claim to be strongly committed to
gratify all the stakeholders with their socially responsible actions. This is the crystal clear
today’s opinion of the Kazakhstan corporate sector about their CSR.

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VOL. 6 NO. 1 2010 SOCIAL RESPONSIBILITY JOURNAL PAGE 39
 Table I Opinion of 50 Kazakhstan companies on corporate social responsibility towards different stakeholders
expectations
Opinion Positive Negative Total

Towards owners or shareholders

1. Fair and regular return on investment 41 9 50
2. Safe and steady appreciation of investment 47 3 50
3. Periodical disclosure of financial and functional aspects of business information 50 0 50
4. Reasonable representation to minority shareholders to participate in business
management 46 4 50
Overall percentage of opinions 87.5 12.5

Towards employees
1. Fair wages 44 6 50
2. Security of employment 50 0 50
3. Safe and secure working conditions 50 0 50
4. Representation in decision making bodies 37 13 50
5. Opportunity for personal advancement 47 3 50
6. Meaningful freedom and job satisfaction 44 6 50
7. Humane treatment 48 2 50
Overall percentage of opinions 88.33 11.67
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Towards customers
1. Supply goods of right quality, right quantity at the right place and time at
reasonable prices 48 2 50
2. Provide goods and services according to the needs, tastes and preferences of
different classes of customers 50 0 50
3. Inform and educate customers 46 4 50
4. Be honest and truthful in advertising 48 2 50
5. Provide prompt, efficient and effective after-sales service 34 16 50
6. Extend a hearty and courteous service 31 19 50
7. Avoid unhealthy trade practices like black-marketing, hoarding and adulteration 48 2 50
Overall percentage of opinions 92.22 7.78

Towards creditors and suppliers

1. Provide accurate information regarding the financial health 50 0 50
2. Fairness in transactions of supply of goods and make prompt repayment
(including interests on borrowings) 45 5 50
3. Promote a healthy atmosphere where creditors, suppliers and other interest
groups are treated as partners in a cooperative endeavor 38 12 50
Overall percentage of opinions 91.18 8.82

Towards the general public

1. Proper and effective utilization of natural resources to produce cheaper and
better goods thereby rendering help to generate indirect self-employment
opportunities 37 13 50
2. Maintain a healthy environment free from all sorts of pollution in and around the
business area 39 11 50
3. Contributions to the community and public utility services 36 14 50
4. Help maintain law and order in the society by refraining from aiding and abetting
anti-social elements 50 0 50
5. Avoid exploiting the religious sentiments or backwardness of the minorities and
weaker sections of the society 50 0 50
Overall percentage of opinions 93.42 6.58

Towards government
1. Pay taxes regularly and correctly 48 2 50
2. Applies faithfully and the laws government regulation of business 50 0 50
3. Avoids political lobbying through donations to political parties 50 0 50
4. Follows a fair trade policy and refrains from unhealthy practices 29 21 50
5. Contribute its mite to the socio-economic growth and goals of the nation 50 0 50
6. Helps in tackling the problems of unemployment, poverty, price rise . . . 44 6 50
7. Helps in establishing a secular democratic and socialistic society 47 3 50
Overall percentage of opinions 89.06 10.94

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 Employees
The researchers peculiarly observed in this study perfect matching of both Kazakh
employers as well employees’ opinion related to security of employment; fair wages;
representation in decision-making bodies; job satisfaction and freedom. And surprisingly
employees reported concretely about their employer’s treatment in an upbeat manner.
Astonishingly, 91.43 percent Kazakh employees’ are totally confident about their
organizations HR policies and practices and only 8.57 percent expressed downbeat
(Table II). Related to providing safe and secure working conditions, employees were not
contented with the actions and provisions of their employers. Frankly speaking, employers’
said only 88.33 percent constructive attitude but employees’ believed 91.43 percent
encouraging opinion on their employers. Employers are always impressive straight to the
point whatever the possible actions, they are implementing straight away. If any area for
implementation has some kind of problem, they are telling directly, it is not possible to
introduce or implement. This is a big encouraging sign to both Kazakh businessmen as well
employees’ community in receiving concrete information about their reciprocal expectations
with positive frame of mind.

Customers
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Only 12.86 percent of Kazakhstan customers were dissatisfied with the business practices
of their corporate sector (Table III). Remaining 87.14 percent customers articulated their
contentment particularly in getting goods and services according to the needs, tastes and
preferences of different classes of customers. In the remaining areas like supply of goods of
right quality, right quantity at the right place and time at reasonable prices; inform and
educate customers; honest and truthful advertising just only below 10 percent customers
were not satisfied. And significantly, 32 and 38 percent of customers were not pleased with
after sales services offered by their business community as well extending hearty and
courteous service. Most significantly, in this part of study also the researchers clearly
observed only 5.08 percent slightest difference between the opinions expressed by the

Table II Kazakh employee opinion on CSR

Opinion Positive Negative Total

1. Fair wages 88 12 100

2. Security of employment 100 0 100
3. Safe and secure working conditions 74 26 100
4. Representation in decision making bodies 94 6 100
5. Opportunity for personal advancement 88 12 100
6. Meaningful freedom and job satisfaction 96 4 100
7. Humane treatment 100 0 100
Overall percentage of opinions 91.43 8.57

Table III Kazakh customer opinion on CSR

Opinion Positive Negative Total

1. Supply goods of right quality, right quantity at the right

place and time at reasonable prices 96 4 100
2. Provide goods and services according to the needs, tastes
and preferences of different classes of customers 100 0 100
3. Inform and educate customers 92 8 100
4. Be honest and truthful in advertising 96 4 100
5. Provide prompt, efficient and effective after-sales service 68 32 100
6. Extend a hearty and courteous service 62 38 100
7. Avoid unhealthy trade practices like black-marketing,
hoarding and adulteration 96 4 100
Overall percentage of opinions 87.14 12.86

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VOL. 6 NO. 1 2010 SOCIAL RESPONSIBILITY JOURNAL PAGE 41
 business community about the social actions towards customers and customers opinion
towards business community.

General public
On overall basis exactly 88.80 percent of general public optimistically responded towards all
socially responsible activities taken up by the corporate sector as against 11.20 percent
(Table IV). In terms of opinions particularly to help maintain law and order in the society by
nonparticipation from aiding and abetting anti-social elements or activities; and avoid
exploiting the religious sentiments or backwardness of the minorities and weaker sections of
the society almost 100 percent expressed positive response. And 26 and 22 percent of the
general public revealed their observation or difference in the actions like proper and
effective utilization of natural resources to produce cheaper and better products and also to
generate indirect self-employment opportunities; maintain a healthy environment free from
all sorts of pollution in and around the business area to protect the health interests of the
public and just 8 percent general public was not contented with corporate sector’s
contributions to the community development projects and public utility services.

Managerial implication
The present study offers insights required for both Kazakhstan business community and also
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to academia in the country to understand the key elements of CSR under the different
interest groups, e.g. owners and shareholders, employees, customers, creditors and
suppliers, general public and government and also to be well-versed with the frankly
expressed views of employees, customers, and general public on CSR actions of their
corporate sector. Predominantly, Kazakhstan corporate sector have the opportunity to
recognize the spreading of displeasure among employees as well as customers about their
personnel policies and business practices. Even though the percentage of dissatisfaction is
only 8.57 among employees, its better to swiftly sort out their discontentment areas mainly
related to safe and secure working conditions; fair wages; opportunity for personal
advancement through education and training; representation in decision making bodies
because these absence definitely will amplify and multiply among the employees and
thereby leads to diminish productivity of these stakeholders. Kazakhstan business
community should also once again review their existing business practices because of
maximum percentage of customers expressed their negative opinion. Mainly Kazakh
customers discontentment areas are expecting hearty and courteous service; efficient and
effective after-sales service; inform and educate customers; supply goods and services for
reasonable prices and introduce honest and truthful advertising. If Kazakh corporate sector
concentrates on these without any abnormal changes in their present budgets, just by
introducing proper interactive and internal marketing, it can be possible to make available
hearty and courteous service as well highly effective after-sales service. Our study also
provides information about the Kazakh general public view on their companies CSR which is
also an essential area to concentrate to change this important stake holder’s opinion with the

Table IV Kazakh general public opinion on CSR

Opinion Positive Negative Total

1. Proper and affective utilization of natural resources to

produce cheaper and better goods thereby rendering
help to generate indirect self-employment opportunities 74 26 100
2. Maintain a healthy environment free from all sorts of
pollution in and around the business area 78 22 100
3. Contributions to the community and public utility services 92 8 100
4. Help maintain law and order in the society by refraining
from aiding and abetting anti-social elements 100 0 100
5. Avoid exploiting the religious sentiments or backwardness
of the minorities and weaker sections of the society 100 0 100
Overall percentage of opinions 88.80 11.20

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PAGE 42 SOCIAL RESPONSIBILITY JOURNAL VOL. 6 NO. 1 2010
 allocation of some time and budgets along with promotional methods to foster the
company’s image. Other stakeholders like shareholders, suppliers and creditors, and local
and federal governments were not satisfied with the social as well as general actions of
companies. With this experience, there is a great scope to introduce modifications in the
social actions of Kazakhstan corporate sector, specially meant for shareholders, suppliers
and creditors, and the government. Particularly, related to shareholders, these companies
have to concentrate more on continuous distribution of fair returns, and if possible better to
consider the opinions of minority shareholders at the time of decision making. Related to
suppliers and creditors, companies also should give attention to repay the debts within the
stipulated time along with cooperative endeavors. Every corporate sector in any part of the
world has a responsibility in extending its supportive hand to all the levels of government by
paying all taxes properly and timely, following a fair-trade policy, contributing to eradicate the
problems of unemployment, poverty, and pollution of all kinds, and lastly extending its
support in achieving the social-economic goals of the country.

Conclusion
In conclusion, the researchers observed slight difference of opinions between Kazakh
corporate sector and their employees, customers and general public on CSR. This
central-Asia’s rich natural resources country’s companies’ are very clear and optimistic
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about their social actions towards all the stakeholders, but they are notifying strongly this is
not the time to concentrate on CSR because of pitiable profitability and anomalous business
situation. One significant factor here observed by the researchers is Kazakhstan corporate
sector candidly expressed their views on CSR towards shareholders, employees,
customers, creditors and suppliers, general public and government. And in the cross
validate section also; employees, customers and general public did not utter any abnormal
displeasure against their companies’. This is a big inspiring sign to the business community
in this country to enhance their business by adding some concrete measures to identify
discontentment areas among all the stakeholders and come-up with corrective actions to get
rid of their dissatisfaction through CSR. Thus, no business community in the planet whether
they are from developed, developing or the underdeveloped world out rightly denied the
significance of socially responsible actions to receive the constructive influence from all the
stakeholders’. Therefore in understanding the opinions of all the stakeholders related to their
business and its social actions, the business community would be better to once again
meticulously review and plan for their companies socially responsible activities to build up
the positive image particularly in the minds of employees, customers and the general public
which is an imperative to survive in this turbulent situation.

Notes
1. www.cia.gov/library/publications/the-world-factbook/geos/kz.html (accessed on 9th April, 2008).

2. Kazakhstan retrieved from: http://en.wikipedia.org/wiki/Kazakhstan (accessed on 7th February,

2009).
3. The Corporate Responsibility as Business-Strategy, 2008, retrieved from www.csrjournal.com/lib/
networkoverview/1838-korporativnaja-otvetstvennost-kak-biznes.html
4. Striving for Harmony through Responsibility, 2007, retrieved from www.investkz.com/en/journals/53/
427.html
5. Corporate Social Responsibility, 2008, retrieved from www.samghau.kz/en/about/social/
6. Corporate and Social Responsibility, 2008, retrieved from www.hsbc.kz/1/2/hsbc-kazakhstan/en/
about-us/social-responsibility/social-responsibility

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Corresponding author
Rajasekhara Mouly Potluri can be contacted at: [email protected]

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