There is no certain answer for this question and it depends on from where we are observing. No doubt globalization has varied effects on social responsibility of a company and behavior of managers. Some of these effects are motivating companies towards socially responsible behavior, while others are destroying fair business and principles, norms and regulations which are mainly result of increasing competition.
On one hand globalization has provides companies to reach to larger consumer base and provided opportunities for collaboration with other companies but it is also true that it has led imperfect competition of big companies (in terms of turnover, market capitalization and assets) with small and medium size companies. Well regulated and controlled markets are not a big problem and treat, but lack of regulation and norms is what creates main problem especially in developing countries as globalization has huge influence in these economies.
The relationship between business and society is still a complicated process and CSR implementation becomes one of important issues in globalized economies and markets. CSR provides the required rules for determination of relationship between corporation and society. Thus CSR is not merely a process but a long term strategic approach by companies that need to adopt socially responsible behavior with the decision makers enforcing the principle guidelines of CSR in the company. The long term perspective to CSR helps company earn benefits concerning profits as well as stakeholder interests in company. Studies and researches have shown relationship between CSR and corporate financial performance also existence of slack resources resulting from better financial performance made when companies invest in areas that are related to social actions. It has also been found that good management practices resulting from engagement in social actions enhance relationship with stakeholders adding to financial performance.
The buying behavior of consumers in globalized world is also influenced by social behavior of companies and hence CSR provides some opportunities to company to gain visibility in the eyes of consumers. Consumers want the company, they are associated with, to behave properly with its suppliers and their suppliers to treat the laborers fairly, even if consumers are in far distant countries. Any unethical behavior company comes into notice of consumers which adversely affects the sales of the respective company.
Therefore, from this aspect globalization has a multidimensional effect relating to socially responsible behavior. Good or bad behavior is easily visible around the world with the advancement in technology and all stakeholders of a company will be aware. A company will be affect with this fact both ways, good behavior will affect positively but unethical behavior will undoubtedly have negative effect. Thus proper socially accepted behavior is the only way companies can survive. To summarize, a firm has investment in reputation as well and hence increase in perceived social responsibility improves the image and permits it to exchange costly explicit claims for less costly implicit charges. Contrary to this, decline in this image results in increase in costly explicit claims.