From the Inside Out: A Framework for Authentic Stakeholder Engagement and Sustainable Development in Emerging Economies

ABSTRACT In the post‐pandemic business landscape, multinational corporations (MNCs) in emerging economies face escalating demands for authentic corporate social responsibility (CSR) that transcends mere philanthropy, and contributes to sustainable development goals. This paper confronts the unique challenges to stakeholder engagement and environmental policy implementation in contexts of high labor informality and weak institutional frameworks. Using Peru as a paradigmatic case, selected for its representative institutional voids and socioeconomic characteristics, the study analyzes how firms build legitimacy. It argues that in such environments, a credible CSR strategy cannot be purely external; it must be an “inside‐out” process grounded in internal legitimacy. This study proposes a novel conceptual framework, the “Integrated Responsibility Ecosystem,” which synthesizes stakeholder theory, neoinstitutional theory, and systems thinking. The model posits a virtuous cycle beginning with purpose‐driven leadership, rooted in internal legitimacy via corporate family responsibility (CFR), extending to strategic external value creation, and sustained by systemic, transparent communication. By applying this model to the case of Kimberly–Clark in Peru, this paper demonstrates that prioritizing employee well‐being is not just an ethical imperative but the foundational strategic step for building resilient reputational capital and achieving sustainable success in volatile markets.