**2.3 The translation institutional and cultural logic to CSR: a research model**

Institutional theory does not only highlight the written factors that affecting the choice of individual or organizational behavior in the form of regulations and the strength of government policies in regulating organizations which is operating in their area. Social factors such as culture, traditions and norms that present in a society are also understood having an important role in creating organizational behavior.

Drawing to a national culture model developed by Hofstede [38], we argue that the cognitive dimension of institutional theory can be explored in more detail with the components of Hofstede's national culture. We focus on selecting four cultural components that have been examined in previous studies discussing the correlation of CSR and national culture: 1) power distance; 2) collective (low individual); 3) Masculinity and 4) Avoidable uncertainty.

According to the Hofstede cultural analysis, Indonesian national culture is presented in below **Figure 1**.

Indonesia has a high-power distance score, which means Indonesians are hierarchically dependent, leadership is a directive and expect high management controls. This power distance component of Indonesia's national culture might correlate with the regulatory dimension. We will examine this two-aspect relationship and explore whether the high-power distance as Indonesia's national culture is reflected in the government's efforts to regulate CSR, and what is the challenge in the implementation?

**Figure 1** also reveals that Indonesia has a low individualism score, which means Indonesia is a society of collectivism. Indonesians also have the character to consider the quality of life more as caring for others than as competitive (low score for masculinity/feminine). In addition, Indonesia also gets a low score for avoidance uncertainty, which means most Indonesians tend to avoid conflict in order to maintain harmony within their society. These facts will be examined to what extent CSR decision making in Indonesian companies is affected by them.

Referring also to the results of previous studies, CSR also has a strong relationship in developing countries, such as the implementation of traditional cultures, such as the influence of the application of religious and other beliefs, such as the

**Figure 1.**

*Indonesia National Culture scoring. Source: https://www.hofstede-insights.com/country/indonesia/.*

*The Institutional and Cultural Challenges of Corporate Social Responsibility: Case Study… DOI: http://dx.doi.org/10.5772/intechopen.94478*

**Figure 2.**

*Research model of institutional and culture challenges of CSR.*

influence of Islamic cultural values on CSR in Turkey [40] Confucian in China [16] and Buddhism in Thailand [41] or Christianity in Brazil [42].

Every citizen in Indonesia has to have one of the foundations of believing in God and mention their religious denomination of Indonesia's five recognized religions: Islam, Christianity, Hinduism, Buddhism, Confucian. Then that difference of belief is united in the context of a national ideology named Pancasila. As previous findings, we assume that these two-dimensional dynamics will heavily color the normative dimension of the institutions in Indonesia: the values of religion and *Pancasila*.

In this study, therefore, our argument and exploration will capture all the issues and we are working with the research model below (**Figure 2**).
