Towards Broader Responsibility? A Quasi-Experimental Analysis of the Effect of Foreign Ownership on Corporate Social Practices in Morocco

Abstract

This article examines the impact of foreign ownership on firms' social performance in Morocco, a context marked by increasing non-financial requirements and an institutional framework still under development. Using World Bank Enterprise Survey data for 2013, 2019 and 2023, the study builds a composite social performance index focused on gender equality, continuous training and human capital development. To address selection bias linked to foreign ownership, the study applies propensity score matching to estimate the average treatment effect. The findings show that firms partially or majority-owned by foreign investors have significantly higher levels of social performance than comparable domestic firms. This effect is robust across several matching algorithms and is particularly strong in industrial sectors exposed to international standards and global value chains, while it is not significant in services. The study interprets these results through legitimacy theory, stakeholder theory and the resource-based view, highlighting foreign ownership as a catalyst for more inclusive social practices.