THE PROBLEMS AND PROSPECTS OF CORPORATE SOCIAL RESPONSIBILITY IN THE NIGERIAN MANUFACTURING INDUSTRY

THE PROBLEMS AND PROSPECTS OF CORPORATE SOCIAL RESPONSIBILITY IN THE NIGERIAN MANUFACTURING INDUSTRY

 

By

 

TUNDE SOFOLUWE

 

 

CHAPTER ONE

INTRODUCTION

1.1       BACKGROUND TO THE STUDY

Academics and practitioners have been striving to establish and agreed upon definitions of the concept of corporate social responsibility for over 30 years. Davis (1960) suggested that social responsibility refers to businesses’ “decisions and actions taken for reasons at least partially beyond the firm’s direct economic or technical interest.”

Eells and Walton (1961) also argued that corporate social responsibility refers to the “problems that arise when corporate enterprise casts its shadow on the social scene, and the ethical principles that ought to govern the relationship between the corporation and the society” (p.5).

 

In today’s dynamic business environment, corporate organisations are faced with the needs to impact positively on the host communities, by taking upon themselves certain responsibilities in order to increase their societal and environment influence. Organisations also included social and environmental concerns in business operations rather than focusing on profit making only. Organisations have developed a variety of strategies for dealing with this intersection of societal needs, the natural environment, and corresponding business imperatives with respect to how deeply and how well they are integrating social responsibility approaches into both strategy and daily operations worldwide.

 

Many organisations such as banks and some manufacturing companies in Nigeria are driven by the need to make more and more profits and that is the sole aim of every business. In a bid to meet this target, some companies do not adequately respond to the needs of host communities, employees’ welfare (cheap labour often preferred), environmental protection and community development. Research has shown that corporate social responsibility can increase profitability, sustainability, integrity and reputation of any business that includes it in its policy.

 

Nkanga (2007) posited that corporate social responsibility involves the commitment shown by companies to contribute to the economic development of a local community and the society at large. The adoption of corporate social responsibility policy should not be driven or motivated by increased profit. Rather, giving back to the society that gave to the business first should be the motivating factor. It is a common practice by Nigerian organisations to put as one of their mission statements the provision of corporate social responsibility. The organisations must have realised that stating corporate social responsibility as one of their mission statements hold special appeal to the stakeholders. Hence, there is an increasing awareness and recognition accorded corporate social responsibility by corporations.

Some critics according to Carpenter, et al. (2010) have argued that corporate social responsibility as implemented by some organisations is mere facade. It is widely believed by many that corporate social responsibility efforts are mere campaigns by organisations to promote corporate brands. Many Nigerians are ignorant of corporate social responsibility; hence, whenever an organisation does something ‘supposedly big’ for the society, such a company and its management are eulogized for being caring and philanthropic.Manufacturing companies in Nigeria are expected to manage the impacts of their operations by adopting corporate social responsibility (corporate social responsibility) programme.  Onwuegbuchi (2009) in his studies on corporate social responsibility among manufacturing firms reported that most manufacturing companies in Nigeria embarked on corporate social responsibility programme for the purpose philanthropic gesture and for government and public appraisal. He further stated that some manufacturing companies applied environmental and labour standards that suit them to satisfy basic requirements of the laws of the country.

 

The Nigerian government should ensure that manufacturing companies’ corporate social responsibility policy entails self-regulation, adherence to rules and regulations, ethical standards, environmental responsibility and sustainability, consumers’ satisfaction, employee welfare, communities and stakeholders benefits.

The problems of the environment in which an organisation operates cannot be ignored. Therefore, there is a need to examine the problems and prospects of corporate social responsibility in Nigeria. In its stronger form, the concept of Corporate Social Responsibility (corporate social responsibility) asserts that corporations have an obligation to consider the interests of customers, employees, shareholders, communities, as well as the ecological ”footprint” in all aspects of their operations.

 

 

 

1.2       STATEMENT OF THE PROBLEM

Despite the huge attention recently given to corporate social responsibility (CSR) in Nigeria, anarea of concernstill remainorganisations in the manufacturing sector. Most manufacturing organisations still do not see any reason for corporate social responsibilitypolicy acceptability. Companies that reluctantly accepted and adopted the corporate social responsibility policy, do so for profit-making purpose.

Another lacking area on corporate social responsibility is that most of the studies on corporate social responsibility were conducted on nations with developed economies and their findings were found out not to be applicable to some developing nation’s economy like the Nigeria. Therefore, this study will examine the problems and prospects of corporate social responsibilities in Nigeria using the manufacturing industry as a case study. It is ironic that these organisations take resources from the external environment and it is only natural to give back what has been exploited. Unfortunately, this anomaly is a norm in this part of the globe and this cankerworm can only be ameliorated through research thesis such as this, publication, media publicity, campaigns and awareness emphasising the importance of corporate social responsibility in our society.

 

1.3       OBJECTIVES OF THE STUDY

The broad objective of this study is to examine the problems and prospects of corporate social responsibility in the Nigerian manufacturing industry. Specifically, the study is designed to:

1. Investigate how corporate social responsibility (corporate social responsibility) influences organisationalreputation in the Nigerian manufacturing industry.
2. Cross-examine the difference between level of perceived customers’ patronage and brand loyalty among companies that practices corporate social responsibility and organisations that donot practice corporate social responsibilityin the Nigerian manufacturing industry.
3. Analyse how corporate social responsibility adoption influences organisational performance and profitability.
4. Assess the economic, social and environmental factors influencing corporate social responsibility (corporate social responsibility) adoption among manufacturing companies in Nigeria.

 

• RESEARCH QUESTIONS

The manufacturing industry plays a significant role in the growth and development of the Nigerian economy, and corporate social responsibility ought to be a voluntary act by the manufacturing companies. It should not have to be forced on organisations by the law, government, and civil rights groups or by the communities. Social responsibility should be a deliberate inclusion of public interest into corporate decision-making and the honouring of a triple bottom line of people and profit making.

In this dissertation there are four specific research questions coined after the statement of the problem and they are listed below.

1. Are there differencesbetween level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that do not practice corporate social responsibility in the Nigerian manufacturing industry?
2. What extent would corporate social responsibility adoption influence organisational performance and profitability?
3. Whatare the economic, social and environmental factors responsible for the poor performance of corporate social responsibility (corporate social responsibility) adoption among manufacturing companies in Nigeria?

 

1.5       RESEARCH HYPOTHESES

To provide empirical answers to the research questions above, the following research hypothesis were developed. They are as stated below;

 

Hypothesis I

H₀:       Corporate social responsibility (corporate social responsibility) does not influence organisational reputation in the Nigerian manufacturing industry.

H₁:       Corporate social responsibility (corporate social responsibility) influencesorganisational reputation in the Nigerian manufacturing industry.

 

Hypothesis II

H₀:       There is no significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry.

H₁:       There is a significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry.

Hypothesis III

H₀:       Corporate social responsibility adoption does not influence organisational performance and profitability.

H₁:       Corporate social responsibility adoption influences organisational performance and profitability.

Hypothesis IV

H₀:       Economical, social and environmental factors do not influence the performance of corporate social responsibility.

H₁:       Economical, social and environmental factors influence the performance of corporate social responsibility.

 

1.6       RESEARCH METHODS

 

This study adopts descriptive survey method. Therefore, a cross-sectional research design is used to design the methodology. The premise for this research method is because data are collected from the population for intensive study and analysis.

More often than not, the research cannot possibly study all subjects or items in the population. Hence, a selective random sample from or a subset of, the population was taken.

The reasons for random sampling are;

• Among the elements (manufacturing companies in Lagos state) that make up the population of study there are similarities and therefore a study of few of these elements will give the researcher sufficient knowledge of what is obtainable in the entire population study.
• It is cheaper to engage in the random study
• It allowed for quicker results and more thorough research conduct.
• It is practically impossible to consider all elements in this research considering the limited time frame.

 

The target population for this study arethe manufacturing companies in Lagos State, but due to large number of manufacturing companies located in the State, some selected organisations will be considered for this study. Primary data will be gathered through questionnaire administered among randomly selected employees of the selected companies. The data will be analysed using frequency and percentage tables and a descriptive analysis will be carried out using a software package for statistical analysistool.

 

1.7       SCOPE AND LIMITATION OF THE STUDY

The focus of this research would encompass the problems and problems of corporate social responsibility and its impacts. The impacts of social services by corporation shall be examined in relations to financial performance, employee commitment, and community development. The study shall focus on the Nigerian manufacturing industry. The perceptions of some key players of the industry shall be sought for the purpose of this research work.

 

Due to limited time of the study and the choice of using questionnaire method, this research does not include an extensive benchmark of corporate social responsibility practices in the Nigerian manufacturing industry, but is restricted to a few organisations situated in Lagos, Nigeria. Though the study uses vital insider information from these organisations, confidentiality of names, data, facts and figures were treated with utmost secrecy and with a caveat.

The reliability and validity of the data can also be verified and contested, but of course that will not be necessary.

 

 

1.8       SIGNIFICANCE OF THE STUDY

The importance of this dissertation is not just to analyse the practice of corporate social responsibility but to understand the current practice, the level of understanding of corporate social responsibility by manufacturing organisations in Lagos state in relation to how it should be. It will explain how corporate social responsibilities affect the performance of these firms.

The research would also help to explore the impact of corporate social responsibility on employees’ commitment to the organisation.What part does the employee play in corporate social responsibility? Can he influence the decision making process?  What is their level of understanding of the concept?

 

 

 

 

 

 

 

1.9       ORGANISATION OF THE STUDY

Chapter one of the study provides background of the study, stating the problem of the study and the research questions and hypotheses to be tested in the study. It also highlights the significance of the study and scope of the study.

Chapter two reviews related literature on problems and prospects of corporate social responsibility of Nigerian manufacturing industry. Itlooks at different authors’ definitions of corporate social responsibility and its activities affects organizations’ reputation, customers’ patronage and brand loyalty. Chapter two examinescorporate social responsibility adoption influences organisational performance and profitability. How economic, social and environmental factors are responsible for the poor performance of corporate social responsibility (corporate social responsibility) adoption will also be extensively reviewed.

Chapter three discussed the research methods to be used in designing the study which will include research design, population, sample size and sampling technique, data collection and data analysis methods.

Chapter four presents the data gathered in frequency and percentage tables. The data will also be analysed and research hypotheses will be tested with chi-square statistical test.

Chapter five summarises the outcome of the study, draw conclusions based on the findings of the study and make necessary recommendations.

 

 

1.10     DEFINITION OF TERMS

Commitment: Commitment as defined in this study means when an employee pledges his loyalty to an organisation. It is an application, dedication or pledge to an engagement or obligation that restricts freedom of action.

Community: Community as used in this study means a group of people who live in an area where an organisation operates. They are a group of people having a religion, race, profession, or other particular characteristic in common.

Social Responsibility: Social responsibility as described in this study is a demonstration of certain responsible behaviour on the part of public and the private (government and business) sectors toward society and the environment.

Performance: Performance is the manner in which an organisation functions, operates, or behaves in the society.

Stakeholder: This study describes a stakeholder as a person or group with a direct interest, involvement, or investment in a business organisation e.g. the employees, stockholders, and customers of a business organisation.

Hypothesis:A hypothesis is a tentative statement about relationships that exist between two or among many variables. It is a conjectural statement about relationships and need to be tested and subsequently accepted or rejected.

Theories and laws: A hypothesis, if it is true, state a law. Therefore, the hypothesis is a law like statement. Law is defined as a statement of invariant relationship among observable or measurable properties.

REFERENCES

Carpenter, T. Andrew,A.D.,  Da-silva, B. (2010): Corporate Social Responsibility in India- An Empirical Research. [Online] Available: http://www.EzineArticles.com

Davis, T. (1960). Corporate Social Responsibility and organizational Profitability”. J. Econ. Soc. Res.3(1):113-124.

Eells, S and Walton, T (1961). The path to corporate responsibility, HBR, December 2004, pp. 125-132.

Onwuegbuchi, D.K. (2004). “The relationship Between Perceptions of corporate citizenship and Organizational Commitment.” Business and society, Vol. 43 no. 3: pp 296-319, Sage Publications

Nkanga, E. (2007). Nigeria: Telecom Operators and Corporate Social Responsibility. This Day, 31st Jan, 2007.www.google.adservices.com.

 

 

 

 

 

 

 

 

 

 

CHAPTER TWO

LITERATURE REVIEW

2.1       INTRODUCTION

Corporate social responsibility is a concept that has become quite familiar in the world-of-business today. There are different perceptions of the concepts among the private sector, government and civil society organisations. Corporate social responsibility poses several challenges for enterprises, including the need to define their responsibilities with respect to those of the public sector, determine the extent of their obligations in the supply chain and decide until what point in the future they should anticipate and plan for the consequences of their activities, especially in the case of natural resource use. Pragmatism in corporate social responsibility is essential because despite the many issues it can address, corporate social responsibility also has its limits and cannot substitute for the role of government in enforcing laws and international labour standards.

 

The European Foundation for Quality Management (EFQM, 2007) presents some common characteristics for corporate social responsibility which are:

1. Meeting the need of current stakeholders without compromising the ability of future generations to meet their own demand.
2. Adopting corporate social responsibility voluntarily, rather than as legal requirement, because it is seen to be in the long-term interests of the organisation.
3. Integrating social, environmental and economic policies in day-to-day business.
4. Accepting corporate social responsibility as a core activity that is embedded into an organisation’s management strategy.

 

The European Foundation for Quality Management (EFQM, 2007) listed three dimensions of corporate social responsibility with specific examples of areas particular to each dimension. These dimensions are:

1. Economic Responsibility: Integrity, corporate governance, economic development of the community, transparency, prevention of bribery and corruption, payments to national and local authorities, use of local suppliers, hiring local labour and similar areas.
2. Social Responsibility: Human rights, training and developing local labour, contributing expertise to community programs and similar areas.
3. Environmental Responsibility: Precautionary approaches to prevent or minimize adverse impacts support for initiatives, promoting greater environmental responsibility, developing and diffusing environmentally friendly technologies and similar areas.

 

Lohman and Steinholtz (2004) viewed the corporate social responsibility as a combination of three separate agendas, namely Corporate Sustainability, Accountability and Governance. The authors derived “Corporate Sustainability” from the United Nation meeting in Rio de Janeiro in 1992 and the Agenda 21. In the UN meeting, Corporate Sustainability was referred to as how to address and balance the social, economic and environmental areas in the world so that the long term survival is not threatened.

Corporate Accountability focused on the credibility of the organisation and this was used in situations where discussions are held about the ability of the organisation to manage (Lohman and Steinholtz, 2004). Corporate governance was used in the discussion about how an organisation is being run. It deals with transparency and in the long run trustworthiness (Lohman and Steinholtz, 2004). Bowen (1953) defined corporate governance as the obligation of business men to pursue those policies, to make those decisions, or to follow those lines of action which are desirable in terms of objectives and values of the society.

Bowen (1953) further emphasised that business in any society needs to take responsibility, for every decision that is made, every action that is taken, must be viewed in the light of that kind of responsibility. Social responsibility requires business organisations to balance the benefits to be gained against the costs of achieving those benefits. There is the general belief that both business and society gain when firms actively strive to be socially responsible. While business organisations gain in enhanced reputation, society gains from the social projects executed by the business organisation.

In the early 1970s, companies began to appreciate community service as a way to improve their images, internally and externally, as well as to serve the communities in which the business operates. A company with a strong community involvement programme is likely to score high in profitability and employee morale (Bhattacharya and Sen, 2004).

 

Social responsibility should, in fact, reflect cultural values and may differ in forms from one society to the other. What is socially acceptable in Japan may differ in forms from that of Germany, Brazil or Indonesia. Japanese firms have proved themselves models citizens on many dimensions of Corporate Social Responsibility. Their support of local community activities and other philanthropic endeavours have led to increased goodwill in the communities where they operate. The firms help society in areas directly related to the operations of the business (Amaeshi, Adi, Ogbechie and Amao, 2006).

Being socially responsible by meeting the public’s continually changing expectations requires wise leadership at the top of the organisation (Miles, 1987). Miles (1987) further observed that corporate leaders who possesses this kind of social vision believe that business should help create social change rather than block it. With such attitude, they know that their own company will have a better chance of surviving in the turbulent social currents of today’s world.

Frooman (1997) further observed that companies that are socially responsible are guided by enlightened self-interest, which means that they are socially aware without giving up their own economic self-interest. Profit is the reward for the firm as it continues to provide true value to its customers, to help its employees to grow, and to behave responsibly as a corporate citizen. An emphasis on social responsibility can attract customers.  Social responsibility also benefits companies by enabling them to recruit a high quality labour force. The reputation of the firm and the goodwill associated with socially responsible actions attract talented prospective employee, that is, people seeking an employer for whom they would be proud to work.

At Cadbury Nigeria plc., the concept of corporate social responsibility is seen as a continuing commitment by business to behave ethically in ways that will contribute to economic development of the nation. It is also expected to improve the quality of life of not only the company’s workforce and families but also that of the local community as well as the society at large (Business Day, Newspaper, 13th October, 2003).

 

Over the last decades there has been an apparent shift from adopting more responsible business practices as a result of regulatory citations, consumer complaints and special interest group pressures, to proactive research exploring corporate solutions to social problems and incorporating new business practices that will support these issues (Onwuegbuchi, 2004).

Onwuegbuchi (2004) stated that shift was due to the following:

1. Increased inthe evidence being documented and shared, demonstrating that socially responsible business practices can actually increase profits.
2. The fact that in our global market place, consumers have more options and can make choicesbased on the criteria beyond product, price and distribution channels. Research emphasized that consumers are also basing their purchase decisions on reputation for fair and sustainable business practices and perceptions of commitment to the community’s welfare.
3. The fact that investors and other stakeholders may also be the driving force with increased public scrutiny and use of more sophisticated pressure tactics, including use of technology and power of internet.
4. Workers’ productivity and retention, which has turned corporate, heads towards ways to improve satisfaction and well-being (Coca-Cola bottler in South Africa launching HIV/AIDS prevention program in the work place).
5. Technology and increased third party reporting having been given increased visibility and coverage of corporate activities, especially when things go wrong, as with current corporate scandals that have made the public more suspicious of business creating the need for business to put a positive shine on their activities. This is even more critical today with instant access to twenty four (24) hours news channel such as CNN outline news articles and e-mail alerts.
6. The bar for full disclosure appears have been raised, moving potential customers from a “consumer beware” attitude to an expectation that they will be fully informed as regards practices including product content, sources of raw materials and manufacturing processes.
7. Advocate of corporate social responsibility argues that companies with good social and environmental records will perform better in the long run than those that do not behave responsibly. This is because customers will like to patronize any company with good social and environmental records more than companies without such records as they will be seen to have identified with the community.
8. It has been argued that since Corporate Social Responsibility can enhance a company’s image, it raises the question of whether or not corporate social responsibility was embarked upon solely for corporate self-interest, company or their chief executives may be politically motivated when making corporate donations. But Black (1989) objecting to this self-interest motive maintains that in corporate social responsibility, the company giving funds does not attempt to gain any advertising benefit or undue identification. The company is contented with the belief that corporate social responsibility is good business.

 

 

 

 

2.2       THEORETICAL FRAMEWORK

This study adopts theoretical analysis and approaches of corporate social responsibility postulated by Secchi (2007) and compared with the theoretical analysis by Garriga and Mele (2004). Secchi(2007) came up with a group of theories based on corporate firms’ criterion and society. The theories are as follows:

1. The utilitarian theory,
2. The managerial theory, and
3. The relational theory.

 

On the other hand, Garriga and Mele’s (2004) analysis mapped out corporate social responsibility into four types of territories. They are:

1. Instrumental theories,
2. Political theories,
3. Integrative theories, and
4. Ethical theories.
5. Utilitarian Theories

The old idea of laissez faire business gives way to determinism, individualism to public control, and personal responsibility to social responsibility. Utilitarian could also be taken synonymously with instrumental theories (Garriga and Mele, 2004; Jensen, 2002) in which the corporation is seen as only an instrument for wealth creation, and its social activities are only means to achieve economic results.

 

 

 

The utilitarian theories are related to strategies for competitive advantages. The proponents of these theories are, for instance, Porter and Cramer (2002) and Litz (1996) who viewed the theories as bases for formulating strategies in the dynamic usage of natural resources of the corporation for competitive advantages. The strategies also include altruistic activities that are socially recognized as instruments for marketing.

 

Secchi (2007) further divided the utilitarian group of theories into two, namely, the social costs of the corporation and the idea of functionalism. The social cost theory has a basis for corporate social responsibility in which the socio-economic system in the community is said to be influenced by the corporate non-economic forces. It is also called instrumental theory (Garriga and Mele, 2004) because it is understood that corporate social responsibility as a mere means to the end, which leads to the fact that the social power of the corporation is materialized specifically in its political relationship with society.

The utilitarian theory, therefore, suggests that the corporation needs to accept social duties and rights to participate in social co-operation. Within it, the functionalist theory, specifically advocates that the corporation is seen as a part of the economic system, which one of the goals is profit making.

The firm is viewed as an investment, and investment should be profitable to the investors and stakeholders.

 

 

 

Assumptions of Utilitarian Theories

The assumptions that govern the utilitariantheory are surrounded by moral agents. Utilitarians believe that moral agents always have to promote the best possible outcome seen from an impartial perspective. Thus, companies are equally obligated to promote the happiness of total strangers, for example poor Africans, and those closely related to the company, for example the employees. Utilitarians have generally argued that helping the poor and hungry people, for example, inAfrica, rather than relatively well-off people, for example, in Denmark, seems to maximise happiness as seen from an impartial point of view, other things being equal (Singer, 1970).

 

2. Managerial Theory

Secchi’s (2007) analysis further stressed that the logic of managerial theory that emphasizes corporate            management in which corporate social responsibilities are approached by the corporation internally. This makes the difference between utilitarian and managerial perspective of corporate social responsibility. This suggests that everything external to the corporation is taken into account for organisational decision-making.Managerial theories are also strongly related to political theories based on the conceptualization by Garriga and Mele (2004) and supported by Lodgson and Wood (2002) as well as Detomasi (2008). They stressed that social responsibilities of businesses arises from the amount of social power a corporation has and the corporation is understood as being like a citizen with certain involvement in the community. The origin of the political power of corporate social responsibility is based on Davis’s (1960) idea who proposed that business is a social institution and it must use power responsibly.

 

3. Relational Theory

Relational theory has a root from the complex firm-environment relationships. The theory was developed by Garriga and Mele’s (2004) analysis of stakeholder approach which was then supported by the work of Mitchel, Agle and Wood (1997). As the term implies, interrelations between the two are the focus of the analysis of corporate social responsibility Conclusions about the three groups of corporate social responsibility theories are as follows: Utilitarian is simplified in its views by the individuals and mechanical from the corporation perspective, managerial is very organisational oriented and measurable; and relational is values-based as well as interdependent between the corporation and society. This conclusion is further strengthened by another not-so-distant conceptualization about corporate social responsibility in that the theories are grouped into instrumental, political, integrative and value based. Instrumental theory is focusing on achieving economic objectives through social activities; political focusing on a responsible use of business power in the political arena; integrative concentrating on drawing together management issues, public responsibility, stakeholder management and corporate social performance; and ethical theory is emphasizing strategies to achieve a good society.

Of the above mentioned theories, the Managerial theory is applied in this study because it believes that social power is generated from inside and outside of the corporation. It considers the internal and external environment and it is factored in the decision making process of the organisation. The populace is represented and their voice is heard using this theory.

 

2.3       CORPORATE SOCIAL RESPONSIBILITY AND CORPORATE IMAGE/REPUTATION

Bromley (2001) defined corporate image as an immediate mental perception of the organisation held by an individual, group or network.That mental picture of an organisation that can be created quickly through communication programs (Gray and Balmer, 1998).

 

Corporate reputation, on the other hand, refers to a particular type of feedback received by an organisation from its stakeholders with regard to “the credibility of the organisation’s identity claims” (Whetten and Mackey 2002).

 

According to Logsdon and Wood (2002), reputation is an assessment by outsiders of how well a company meets its commitments and conforms to its stakeholders‟ expectations. It also has to do with “how well its overall performance fits the socio-political environment”. Fombrun and Shanley (2000) determined that a firm’s good reputation attracts investors and better-qualified personnel, lowers the cost of capital and enhances its competitive ability. Herremans, et al. (2003) found that companies with better corporate social responsibility reputations outperform those with poorer reputations and provide investors with higher stock market returns. Firms with good reputation also command higher prices, generate more employee loyalty and greater productivity, have bargaining power with their suppliers, more stable revenues, and are less exposed to crises (Fombrun, 2006).

 

However, the difference between corporate reputation, image, and identity is not clear (Whetten and Mackey, 2002). Corporate image and reputation are oftentimes used interchangeably as if their meanings were hardly different. Therefore these concepts have been used either as if they were synonymous (Williams and Barrett, 2000), as though they related to one another (Balmer, 2001) or, as Bromley (2001) argued, as if they represented distinct constructs.

 

Corporate image and reputation have been considered as intangible assets and valuable resources a firm can use in order to differentiate itself from its competitors. As Mahon (2002) pointed out, “reputation is built over time as the result of complex interrelationships and exchanges between a company and its stakeholders.” This complexity of interrelationships makes imitation difficult for competitors in the short term (Mahon, 2002).

 

 

Although, as argued by Wartick (1992), “the grand aggregation approach to corporate reputation loses substantial informational content unless multiple list(s) of stakeholders can be surveyed,” this research will be conducted taking into account the perspectives of only two stakeholders, SCG employees and Bangkok residents, due to a number of limitations, most notably time. One direct implication of this narrowed down perspective is that, for purposes of this research, corporate reputation as measured in terms of “stakeholders” perspectives thus means only the perspectives of employees and Bangkok residents as to how the organisation meet their demands and expectations.

 

Jones (2005) reported that in the present highly competitive environment globalized world, corporate social responsibility and corporate reputation, majority of fortune companies have used corporate social responsibility as a strategic instrument to giving feedback to expectations of various stakeholders i.e. media, non-government organizations, public opinion, and even consumers, to ultimately develop a significant corporate image.

 

Dean (2008) also suggested that boosting corporate reputation as an extrinsic driver for the companies to engage in corporate social responsibility activities. Corporate reputation has been acknowledged as a mediating variable in corporate social responsibility disciplines (Chi-Shiun Lai, et al 2010).

Bendixen and Abratt (2007) investigated a large South African multinational reputation in company buyer relationships, representing that the buyers ethical perception about company make up the basis for corporate reputation.

 

 

 

2.4       CORPORATE SOCIAL RESPONSIBILITY, CUSTOMERS’ PATRONAGE AND BRAND LOYALTY

Cornell and Shapiro (2007) studies on the relationship between corporate social responsibility and patronage and brand loyalty showed there is a positive correlation. The authors’ viewpoint for positive correlation between corporate social responsibility and patronage and loyalty suggested that as a company’s explicit costs are opposite of the hidden costs of stakeholders, therefore, this viewpoint is proposed from the perspectives of avoiding cost to major stakeholders and considering their satisfaction.

 

Cornell and Shapiro (2007) further inferred that commitment to corporate social responsibility would result in increased costs to competitiveness and decrease the hidden costs of stakeholders. Their argument was meaningful and reasonable, as good relationships with employees, suppliers, and customers are necessary for the survival of a company.

 

Bowman and Haire (2008) pointed out that some shareholders regard corporate social responsibility as a symbolic management skill, namely, corporate social responsibility is a symbol of reputation, and the company reputation will be improved by actions to support the community, resulting in positive influence on sales. Therefore, when a company increases its cost by improving corporate social responsibility in order to increase competitive advantages, such corporate social responsibility activities can enhance company reputation, thus, in the long run patronage and brand loyalty can be improved, by sacrificing the short term patronage and loyalty.

 

According to Simpson and Kohers (2002), the relationship between corporate social responsibility (corporate social responsibility) and patronage and brand loyalty has been given huge attention among scholars. Simpson and Kohers (2002) studies on the linkage between corporate social responsibility and patronage and brand loyalty showed negative correlation.

 

Simpson and Kohers (2002) viewpoint for negative correlation between corporate social responsibility and patronage and brand loyalty suggested that the fulfilment of corporate social responsibility will bring competitive disadvantages to the company methods or need to bear other costs. The author further stressed that when carrying out corporate social responsibility activities, increased costs will result in little gain if measured in economic interests. When neglecting some stakeholders, such as employees or the environment, result in a lower corporate social responsibility for the enterprise, the patronage and brand loyalty may be improved.

 

 

2.5       CORPORATE SOCIAL RESPONSIBILITY AND ORGANISATIONAL PERFORMANCE AND PROFITABILITY

Corporations around the world are struggling with a new role, which is to meet the needs of the present generation without compromising the ability of the next generations to meet their own needs. Organisations are being called upon to take responsibility for the ways their operations impact societies and the natural environment. They are also being asked to demonstrate the inclusion of social and environmental concerns in business operations and in interactions with stakeholders (Van Marrewijk and Verre, 2003).

Organisations have developed a variety of strategies for dealing with this intersection of societal needs, the natural environment, and corresponding business imperatives with respect to how deeply and how well they are integrating social responsibility approaches into both strategy and daily operations worldwide.

 

A firm cannot ignore the problems of the environment in which it operates. Therefore, there is a need to examine the impact of corporate social responsibility on firm’s profitability in Nigeria. In its stronger form, the concept of Corporate Social Responsibility (corporate social responsibility) asserts that corporations have an obligation to consider the interests of customers, employees, shareholders, communities, as well as the ecological ”footprint” in all aspects of their operations.

 

Little (2006) maintained that corporate social responsibility initiatives can lead to innovations through the use of social, environmental, or sustainability drivers to create new products and services.

 

The theme of environmental and social responsibility appears in a number of political and legal documents and is gaining ever-greater importance at the international level. Today, corporate leaders face a dynamic and challenging task in attempting to apply societal ethical standards to responsible business practice.

 

However, there is a great deal of ambiguity and uncertainty about what corporate social responsibility really means as well as what drives a business to pursue it. Whatever are the motivations behind corporate social responsibility theories, it is also interpreted as the concept of triple bottom-line (“People, Planet, Profit”) which captures an expanded spectrum of values and criteria for measuring organizational success; economic, environmental and social. Whereas business ethics and corporate governance combine to generate the means to achieve organizational excellence, the real test is when this excellence is converted into business sustainability and here, corporate social responsibility plays a major role.

Various views have been offered to explain the importance or otherwise of corporate social responsibility (corporate social responsibility) in business activity. For their part, neoclassical economists advance that the firms should devote their energies to supplying goods and services to their customers, they should minimise costs and maximise profits; and all this should, of course, take place within the laws and rules/regulations of the land (Carroll, 1979; Jamali, 2006; Jamali and Mirshak, 2007; Quazi and O’Brien, 2000). Indeed, some proponents of this viewpoint go as far as to argued that corporate social responsibility is not only a deflection from the main business of wealth-creation, thus serving to blunt competition, but is also an economic (cost) imposition on the firm (Friedman, 2008).

Theories on the connection between corporate social performance and firm profitability are based on equilibrium asset pricing models as well as on the efficient market hypothesis (Guenster et al., 2005). It predicts three possible relations.One direction of reasoning postulates a neutral relation. It assumes that the risk associated with compliance with Corporate Social Responsibility is not priced, therefore all companies, corporate social responsibility complying as well as non- corporate social responsibility complying, have the same rate of expected return and face the same cost of equity capital (Hamilton et al., 2003).

This reasoning is in line with standard financial theory (risk-return paradigm) where only risk factors are priced in the market. On the other hand, if the risk associated to Corporate Social Responsibility compliance is (correctly) priced by the market, the same risk-return paradigm would imply a negative relation between corporate social performance and financial performance. As put forward by Shane and Spicer (1983), firms which actively account for the corporate social responsibility risk factor are seen as less risky investments (relative to the firms that ignore it).Consequently, on a risk-adjusted basis, their expected returns are predicted to be lower.

 

Finally, the third view postulates that the compliance with Corporate Social Responsibility principles is not efficiently priced by market participants. A positive (negative) relation follows depending on the sign of the inefficiency. For example, Hamilton et al. (2003) argue that, if a sufficiently large number of investors underestimate (overestimate) the probability that adverse events related to Corporate Social Responsibility issues might affect companies not complying with the corporate social responsibility principles, then their stocks will provide lower (higher) risk-adjusted return than socially responsible companies stocks.

 

Since the answer to the question whether the risk associated to Corporate Social Responsibility issues is (correctly) priced by the market cannot be given on theoretical grounds only, it is investors’ perception of the relevance of the Corporate Social Responsibility principles that counts in the end. If investors believed that companies implementing the Corporate Social Responsibility principles are resource wasteful, they would determine a negative return premium on these companies stocks. On the contrary, if corporate social responsibility behaviour of companies is in line with investors’ beliefs, they would determine a positive return premium for these companies stocks (Ullman, 2005).

 

2.6       ECONOMICAL, SOCIAL AND ENVIRONMENTAL FACTORS INFLUENCING CORPORATE SOCIAL RESPONSIBILITY (corporate social responsibility) ADOPTION IN NIGERIA

Through corporate social responsibility, businesses reaffirm their principles and values, both in their processes and operations and in their interaction with other social actors. Corporate social responsibility is generally voluntary in nature and refers to activities that exceed a mere compliance with the law. The social and environmental responsibilities of enterprises may reflect the changing expectations of society. For example, what enterprises consider convenient practices today may become indispensable ones tomorrow. In addition, it is expected that different social actors interested in the activities of a certain enterprise will prioritize different social and environmental demands, which may contradict or compete with one another at times (Mackey, Mackey and Barney, 2007).

 

Corporate social responsibility poses several challenges for enterprises, including the need to define their responsibilities with respect to those of the public sector, determine the extent of their obligations in the supply chain and decide until what point in the future they should anticipate and plan for the consequences of their activities, especially in the case of natural resource use. Pragmatism in corporate social responsibility is essential because despite the many issues it can address, corporate social responsibility also has its limits and cannot substitute for the role of government in enforcing laws and international labour standards (Detomasi, 2008).

 

Corporate social responsibility as defined by European Commission (2001) is “a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis” following increasingly aware that responsible behaviour leads to sustainable business success. Corporate social responsibility social activities may include charitable contributions to local and national organizations such as fundraising, donations and gifts in areas where it trades and others like regeneration of deprived communities, reclamation of derelict land and creation of new regeneration jobs.

 

However, what cuts across a number of definitions that scholars have proposed on the concept of corporate social responsibility is the general belief that, beyond the quest to maximize corporate profits, corporate organizations play a crucial role in solving society’s problems (McWilliams and Siegel, 2000).

According to Matten and Moon (2004), the fundamental idea of corporate social responsibility is that “it reflects both the social imperatives and the social consequences of business success, and that responsibility accordingly falls upon the corporation, but the precise manifestation and direction of the responsibility lies at the discretion of the corporation.”

Such a characterization of corporate social responsibility makes it a mandatory exercise in that it assumes that business has a direct responsibility to help in solving society’s problems.This study argues that, though the modalities of implementing corporate social responsibility programmes are at the discretion of corporate organizations, it does not make corporate social responsibility a freely chosen programme to contribute towards social prosperity (McWilliams and Siegel, 2000).

Therefore, for Aristotle and subsequent proponents of the broader view of corporate social responsibility such as Davis (1960), the widely held narrow view of corporate social responsibility that business is primarily concerned with profit making and maximization than social concern is unrealistic. For Davis (1960), corporate organizations ought to have responsibilities beyond simply enhancing their profits because they enjoy greater social and economic power in any society.

 

In fact,Friedman recommended that corporation law should be modified to discourage corporate social responsibility (Manne, 2006). And yet more than thirty years after Friedman made his declaration, corporate social responsibility has become the norm. Surprisingly enough, empirical research has indicated positive, neutral and even negative impacts of corporate social responsibility on financial performance. While corporate social responsibility sceptics can explain away the practice of corporate social responsibility as a result of pressure from society, an explanation for the profit motives behind corporate social responsibility becomes even more necessary to explain the source of the social pressure.

 

 

2.7       PROBLEMS OF CORPORATE SOCIAL RESPONSIBILITY

1. Problems

Despite the glaring deficiency in government service provisions, some business organisations claimed ignorance and do nothing while those doing the right thing are not encouraged by the government as to motivate others not to relent. Militating problems on corporate social responsibility include insecurity resulting from persistent violent conflicts, unemployment, religion intolerance, ethnics’ agitation and multiple crises; corruption, poor focus on goals attainment, poor governance, especially degrading state of infrastructural development and maintenance and of cause natural disasters such as fire outbreak, droughts and floods.

 

Chiejina (2011)reported that many factors account for the apparent neglect of corporate social responsibilities by Nigerian organisations for the development of the nation. Such challenges among others include:

1. The lack professionalism in management style. Many Nigeria managers do not perceive social responsibility as one of the key functions of management. The managers lack social skills to deal with social matters.
2. Many Nigerian enterprises are very small in size and their financial strength precludes the consideration of social responsibility as a task that must be seriously considered. Some of the other large companies are owned by foreign firms whose main pre-occupation is profit maximization. Some of these firms see social responsibility as a patriotic gesture best undertaken by indigenous businessmen to help their country.
3. Involvement in social activities could adversely affect the economic health of a business enterprise. It is contrary to the basic function of the business. For example business enterprise may want to maximize profit or maximize market share which is the objective of the organisation.

 

Many organisations involve themselves in social activities because of the tax exemptions or the income spent on special purposes. Corporate Social Responsibility process is “routinely being abused because of the scramble for maximizing profits. From oil multinationals, telecommunication giants, to the banking sector, it has become en vogue to engage in highly publicized charitable and philanthropic ventures as an act of corporate social responsibility to plicate the abused public. And that more often than not, many approaches to corporate social responsibility pit businesses against society, thereby emphasizing the cost and limitations of compliance with externally imposed social and environmental standards (Chiejina, 2011).

 

2. Prospects

Corporate Social Responsibility creates better awareness and acceptance of company’s products that encourage a vast majority of individuals to continuously patronizing concerned organisations’ and contribute significantly to facilitate their growth and development in particular and the national economy in general. No customers, no business. Nigeria’s large population of over 150 million persons makes her attractive to foreign investors. Social responsibilities by their nature do not add to a businessman’s profit in the short run but benefit the larger society in the long run. Being a member of the larger society, the businessman is expected to benefit in the long run. If every businessman behaves socially responsibly, the society will be a better place and will make faster progress to develop. To justify the arguments for social responsibility, Salawu (2007) stated that an organisation could not exist in isolation from the society in which it is located. No management can ignore the environment in which it operates. Moreover, success of organisations may depend, to a large extent, upon their public image.

 

Salawu (2007) also reported that Corporate Social Responsibility offers a “two-way stream of benefit to the companies. On the one hand, it stimulates innovative business and technological initiatives which would open up new market avenues for company operations. Furthermore, it will focus on the prospect of touching new market zones. On the other hand, it will give a clearer societal reputation and socially responsible identity to companies and their employees in the long-run. Corporate social responsibility enables organisations and individuals or group to contribute to the happiness and wellbeing of beneficiaries and at large the society.

 

2.8       CORPORATE SOCIAL RESPONSIBILITY (CSR) IN NIGERIA

With regard to Nigeria and the development of corporate social responsibility, Nigeria has been party to several international human rights treaties. The government of Nigeria is one of the governments together with Azerbaijan and Ghana, Kyrgyzstan who have committed to the UK-led Extractive Industries Transparency Initiative, where they have committed to making public all their revenues for oil, gas and mining.

 

Building on the United Nations declarations, conventions and efforts of constituents especially the International Labour organisation, the ISO has continued a process towards a harmonized approach under the leadership of both the Swedish Standard Institute and the Brazilian Association of Technical Standards. This process has active participation of Nigeria where the National Mirror Committee on Social Responsibility is working to contribute towards the completion of ISO26000 by 2008. The aim is to encourage voluntary commitment to social responsibility and will lead to common guidance on concepts, definition and methods of evaluation.

 

The Nigerian government has also through its NEEDS strategy (Nigerian National Planning Commission 2004) set the context by defining the private sector role as by stating that “the private sector will be expected to become more proactive in creating productive jobs, enhancing productivity, and improving the quality of life. It is also expected to be socially responsible, by investing in the corporate and social development of Nigeria.”

 

Further a Global Compact network was officially launched in Nigeria during the 12th Annual Nigerian Economic Summit in Abuja in 2006 where some Nigerian companies have already signed on to the Global Compact. The Nigerian oil sector is dominated by multinational companies. To compensate for the government’s governance failures and to protect their own business interests, the companies often engage in corporate social responsibility. The history of formalized corporate social responsibility in Nigeria can be traced back to the corporate social responsibility practices in the oil and gas multinationals with the focused on remedying the effects of their extraction activities on the local communities. The companies provide pipe-borne waters, hospitals and schools. Many times these initiatives are ad hoc and not always sustained (Amaeshiet al., 2006).

According to (Amaeshiet al., 2006) it appears that Nigerian companies are engaged in one corporate social responsibility activity or the other. However, 85 percent of the respondents said that there is an awareness of corporate social responsibility in Nigeria but without significant actions, while 7.7 percent either claimed there is almost no awareness with significant actions, respectively.

 

2.9       CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES BY MANUFACTURING COMPANIES NIGERIA

Nestle Nigeria Plc. – Worldwide, through micronutrient fortification of food products, Nestlé provided 53 billion servings of iron, 102 billion servings of iodine, and 35 billion servings of vitamin A and14 billion servings of zinc in 2011. Nestlé collaborates with scientists on a global scale and regional level to fortify appropriate food products according to local needs. In furtherance of their effort to improve the availability of affordable micronutrient-fortified foods in Nigeria, Nestle decided to launch the new Golden Morn fortified with iron. Nestlé’s development of the Vitamin A and iron-fortified Golden Morn is a reflection of their on-going commitment and leadership to play an important role in the daily life of Nigerians.

 

Nestle Nigeria Food Plc., as part of its corporate social responsibility, has trained about five hundred teachers from twenty-five primary schools in Abeokuta, the Ogun State capital. The training, tagged ‘healthy kids’ programme, according to the company’s Executive Director, Centre for Health, Education, Population and Nutrition (CHEPON), Professor Tola Atinmo, was aimed at training teachers drawn from the twenty local government areas of the state on how they could help their pupils live and maintain a healthy life.

 

Dangote Group – Dangote is also one of the fastest growing brands in Nigeria and boosted the company’s overall ranking in packaged food from eighth in 2006 to third in 2010. The company’s success stems from its modern production facilities as much as the connections between its top management and local authorities and government officials. The company has been very active in promoting itself, its corporate identity and direction, and this has surely seduced retailers and consumers alike (Dangote Group annual report, 2011).

 

Dangote has created its own charitable organisation called the Dangote Foundation which is very active in terms of PR and marketing efforts. In March 2011, the company invited to its headquarters the top media executives and publishers in Nigeria in order to acquaint the media with the on-going expansion plans of Dangote Group (Dangote Group annual report, 2011).

More ambitious was the launch in early 2011 of a NGN5 billion (US$33 million) fund for job creation, in partnership with the Bank of Industry. This initiative is meant to help create employment in small and medium enterprises across the country. The fund will be increased further to NGN10 billion at a later stage. The company hopes this fund will create around one million jobs in Nigeria(Dangote Group annual report, 2011).

 

Cadbury Nigeria Plc. – As a way of corporate social responsibility, the staffs of Cadbury Nigeria Plc., recently donated some funds to the awareness of breast cancer and financial support to the diagnosed persons of the ailment in Nigeria.The day, which was separated to create awareness on breast cancer in the country, was tagged “the pink day”. And it was graced by personalities and friends while Cadbury staff all came in pink wears. Employees of the company donated cheerfully to the awareness of the disease, which had claimed many lives and turned homes apart. The donation would be given to the Care Organisation and Public Enlightenment (COPE), a non-governmental organisation, who would prudently utilize the funds to achieve the purpose of the donation (www.proshare.com).

 

PZ Cussons Nigeria – PZ CUSSONS Nigeriahas been in the forefront of the social and economic development in Nigeria for more than 100 years. The PZ Cussons Foundation was established in November 2007 in order to discharge social responsibility in a more robust and systematic manner. It is currently set up as an independent body with the primary aim of discharging corporate social responsibility activities of the principal company by supporting projects in the area of health, roads, education and water. The Foundation is a demonstration of the commitment of PZ Cussons to Nigeria and a strong desire to make life noticeably better for the communities in which the company operate(www.proshare.com).

Promasidor – As part of its Corporate Social Responsibilities (corporate social responsibility), Promasidor Nigeria Limited, makers of Cowbell Milk, in collaboration with Multisports Services and Entertainment Limited, have launched Cowbell Football Academy. The academy is to foster the unity football creates among the people. Cowbell Milk is also the Official Milk of the Nigerian Olympics Team to the 2012 Olympic Games in the United Kingdom

REFERENCES

Achua, J.K. (2008) Corporate Social responsibility in Nigerian Banking system. Society and Business Review Vol. 3 No.1 Emerald Group Publishing Limited.

Amaeshi, K. M., Adi, A.B. C., Ogbechie, C. and Amao, O. O. (2006)Corporate Social Responsibility in Nigeria: Western Mimicry Or Indigenous Influences? Available at:SSRN: http://ssrn.com/abstract

Bendixen, E. W., and Abratt, C. L. (2007) Customer satisfaction and shareholder value.Journal of Marketing: 172-185.

Bhattacharya, C. B. and Sen, S. (2004) Doing Better at Doing Good: When, Why, and How Consumers Respond to Corporate Social Initiatives. California Management Review, Vol. 47 No. 1, pp. 9-24.

Black, D. (1989)Managing organizations in Africa, Berlin and New York:Walter de Gruyter, pp.169-171.

Bowman E. H. and Haire M. (2008) A strategic posture toward corporate social responsibility, United States, Los Angeles: California Manage. Rev. 18(2): pp 49-58.

Bromley, T. J. (2001) The company and the product corporate associations and consumer product responses. The Journal of Marketing 61(1): 68–84.

Business Day(2003) Cadbury Nigeria Plc. Rolls Out more Corporate Social Responsibility Projects in 20^th century. PP 12

Carroll, A. B. (1979) A Three-dimensional Conceptual Model of Corporate Performance. Academy of Management Review, Vol. 4, No. 4, pp. 497-505.

Carroll A. B. and Buchholtz, R. (2003) The pyramid of corporate social responsibility: towards the moral management of organizational stakeholders, Business Horizon, Vol. 34 No. 4, pp 39-48.

Chiejina A. (2011)How to Deploy CRS to Benefit Host Communities,Business Day, May 10. P19.

Charles, P. (2010) Companies look at corporate social responsibility initiatives for branding slump. http://www.livemint.com/2009/02/08111815/Companies-look-at-corporate social responsibility-initiati.html (accessed 24 December, 2012).

Chi-Shiun Lai, Ettlie, J. E. and A. H. Rubenstein (2010) “Firm size and product innovation.” Journal of Product Innovation Management4(2): pp. 89-108.

Cornell, S. and Shapiro, M. (2007) Understanding the Influence of corporate social responsibility on Corporate Identity, Image, and Firm Performance. Management Decision, Vol. 48, No.10, pp.1469–1492.

Davis, K. (1960)Corporate Social Responsibility and organizational Profitability. J. Econ. Soc. Res.3(1):113-124.

Dean, D. H. (2008) Consumer perception of corporate donations effects of company reputation for social responsibility and type of donation.Journal of Advertising32(4): 91-102.

Detomasi, D. A. (2008) The political roots of corporate social responsibility. Journal of Business Ethics, 82, 807-819.

European Foundation for Quality Management (EFQM, 2007) EFQM internal report. http://www.efqm.com.my/aboutdigi/  doc (accessed 22 December, 2012).

Fombrun, T.M (2006) Shareholder value, stakeholder management, and social issues: What’s the bottom line?” Strategic Management Journal, 22 (2): 125-139.

Friedman, (2008) The social responsibility of business in to increase its profits. New York Times Magazines, 13 Sept., 32-33.

Frooman, J. D. (1997) “Strategic philanthropy: responding to negative portrayals of corporate social responsibility.” Corporate Reputation Review3(2): 124-136.

Garriga F. and Mele, S. (2004)Corporate Social responsibility as Risk Management: A model for Multinationals. Social Responsibility Initiative Working Paper, No.10. Cambridge MA. John F. Kennedy School of Government, Harvard University.

Gray, R. and Balmer, D. (1998) Social and Environmental.Disclosure and Corporate Characteristics: A Research note and Extension. Journal of Business Finance and Accounting, 28 (3 &4), pp.327-356.

Guenster, H., Rettab, E., Brik, P. and Mellahi, T. (2005) Corporate social responsibility – a PR invention?, Corporate Communication. An International Journal, Vol. 6 No. 1, 2001, pp. 18-23.

Hamilton, D., Griffin, J.J. and Mahon, J.F. (2003) “The Corporate Social Performance and Corporate Financial Performance Debate: Twenty-Five Years of Incomparable Research.” Business and Society. 36: pp 5-31.

Herremans, T., Collier, T., De Man, F. and Kahn, T. (2003) Corporate social responsibility and its impact on corporate reputation, Brand Strategy (Sept), Issue 195, p. 40-41.

Jamali, G.  (2006) “Corporate social responsibility: A three-domain approach.” Business Ethics Quarterly: 503-530.

Jamali, G. and Mirshak, S. (2007) “The Impact of Product Recalls on the Wealth of Sellers,” Journal of PoliticalEconomics. 93(3) 512-536.

Jensen, R. A. (2002) Being good while being bad: Social responsibility and the international diversification of U.S. firms. Journal of International Business Studies, 37(6), 850–862.

Jones, D. R. (2005) “The effect of corporate social responsibility on corporate reputation.” Journal of Marketing: 16-32.

Litz, R. A. (1996) A resource-based view of the socially responsible firm: Stakeholder interdependence, ethical awareness, and issue of responsiveness as strategic assets. Journal ofBusiness Ethics, 15, 1355-1363.

Lodgson, J. M. and Wood, D. J. (2002) Business citizenship: From individuals to organizations. Business Ethics Quarterly, Ruffin Series, 3, 59-94.

Lohmans, G and Steinholtz, P. (2004) The Boundaries of Strategic Corporate Social Responsibility. Journal of Consumer Marketing, Vol. 18, No. 7, pp 595-630.

Mackey, A., Mackey, T. B., and Barney, J. B. (2007) Corporate social responsibility and firm performance: Investor preferences and corporate strategies. Academy of Management Review, 32(3), 817–835.

Mahon, M. (2002) Social responsibility and impact on society, The TQM Magazine, Vol. 12, No. 3, pp. 172-178.

Manne, I., O. (2006) A stakeholder model for implementing social responsibility in marketing. European Journal of Marketing 39(9/10): 956-977.

Matten, R.K. and Moon, N.S. (2004) An analysis of linkage between economic value added and corporate social responsibility”, Management Decision, 46(9): 1437-1443.

McWilliams, A. and Siegel, D. (2000). Research notes and communications. Corporate social responsibility and financial performance: correlation or misspecification? StrategicManagement Journal, vol 21, pp 603-9.

Miles, D. J. (1987) “Corporate social performance revisited.” Academy of management review: 691-718.

Onwuegbuchi, D.K. (2004). “The relationship Between Perceptions of corporate citizenship and Organizational Commitment.” Business and society, Vol. 43 no. 3: pp 296-319, Sage Publications.

Porter, R. and Cramer, G. (2002) Social capital in firm-stakeholder networks: A corporate role in community development. Journal of Corporate Citizenship, 26, 121–134.

Quazi, E. and O’Brien, T. (2008) Evaluate Corporate Social Responsibility. Disclosure Annual Report Companies in Multifarious Group of Industry Members of Jakarta Stock Exchange, Indonesia. Social Responsibility Journal, 4(3) Emerald Group Publishing Ltd.

Salawu R. O. (2007)“Corporate Social Responsibilities,Nigeria, Onitsha: Africana FEP Limited Evidence from oil companies in Nigeria”.Nig. J. Bus.Soc Sc; 1(1): pp 31-42.

Secchi, D. (2007) Utilitarian, managerial and relational theories of corporate social responsibility. International Journal of Management Reviews, 9, 4, 347-373.

Shane L. and Spicer D. (1983) “The corporate social-financial performance relationship.” Bus. Soc. 36: pp 419-429

Simpson, W. G. and Kohers, T. (2002) “The Link between Corporate Social and Financial Performance: Evidence from the Banking Industry,” J. Bus. Ethics. 35: pp 97-109

Singer, J. D.H. (1970) “An empirical examination of the relationship between corporate social responsibility and profitability.” Academy of ManagementJournal, 28 (2): 446-463.

Wartick, A. (1992)Trend performance in credit financing of rural business activities in Nigeria: A case study of community banks in Ibadan, Oyo State. International Journal of Agriculture and Rural Development, 7 (1): 50-60.

Whetten, S.A., and Mackey, B.G. (2002) “The corporation social performance – financial performance Link”. Strategic Management. Journal. 18 (4) 303-319

Williams, T. and Barrett, P. (2000) “Making Corporate Social Responsibility (corporate social responsibility) Operable: HowCompanies Translate Stakeholder Dialogue into Practice.” Business and Society Review, 111 (2), pp 137-163.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHAPTER THREE

 

RESEARCH METHODOLOGY

3.1       Introduction

This chapter describes the techniques and procedures used by the researcher in conducting the study and accumulating the data for the study. It comprises of the description of the population of the study, sampling techniques, sample size, sources of data, method of data collection and method of data analysis and testing hypothesis.

 

3.2       Research Design

According to Cooper and Schindler (2003), a research comprises of defining and redefining problems, formulating hypothesis or suggested solutions, collecting, organizing and evaluating data, reaching conclusions, and testing conclusions to determine whether they fit the formulated hypotheses.

 

Due to the descriptive nature of this research, a random sampling research design was used to design the methodology. A random sampling research design collects data to make inferences about a population of interest (universe) at one point in time. Random samplinguses the principle of randomisation, which is a procedure of giving every subject in a population an equal chance of appearing in the selection.

 

 

 

 

3.3       Population of the Study

A population is refers to as the total entities existing in a specified area, such as an organisation, city, country, or continent, at a given time (Collis and Hussey, 2003). The population for this study was the entire manufacturing companies in Lagos State.

 

3.4       Sample Size and Sampling Technique

Sample Size: A Sample size is the number of observations used for determining estimates of a given population (Neuman, 2006). The sample size for this study was two hundred (200) respondents (staffs) selected from ten (10) manufacturing companies in Lagos State namely; Nestle Nigeria Plc., Cadbury Nigeria Plc., PZ Cussons Nigeria, Dangote Cement, Unilever Nigeria Plc., Nigerian Bottling Company, Nigeria Breweries, Promasidor Nigeria Limited, Macmillan Nigeria Publishers and De – United Foods Industries. The sample size selected was designed to obtain adequate and diverse views pertaining to the effectiveness of corporate social responsibility in the manufacturing industry.

 

Sampling Technique: Random sampling was used to choose the sample size for this study. This means that employees were randomly selected from the organisations. This choice of sampling method gives every staff in each manufacturing company an equal chance of being part of the sample size. The sampling method was also very effective, efficient and easy to present.

 

 

 

 

3.5       Data Collection Method

Data collection refers to generating or bringing together information that has been systematically observed, recorded, organized, categorized, or defined in such a way that logical processing and inferences may occur (Neuman, 2006). Primary data were gathered through questionnaires administered among the selected two hundred (200) respondents (staffs) of ten (10) manufacturing companies in Lagos State.

The researcher desired to distribute a total of 250 questionnaire among the ten selected companies, but due to the limited time given by some of the companies managements, the researcher was able to administered only 218 questionnaire. Out of the 218 administered questionnaire, only 211 were returned and out of the returned questionnaire, only 200 were found to be well completed and valid.

 

3.6       Data Analysis Method

The data collect through the questionnaire presented in tabular form. The data gathered from the questionnaire were analysed and presented in frequency and percentage tables. The data were also interpreted and the chi square statistical test was used to test the stated hypotheses.

 

 

 

 

 

 

3.7       Limitations

One major limitation this study encountered during data collection was the little timeframe given some companies authorities to conduct the research. Majority of the companies’ managements gave the researcher less than 30 minutes to conduct the research. This given time was not enough for the data collection. This timeframe did not allow some staff to give full attention to the questionnaire.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REFERENCES

Collis, J. and Hussey, R. (2003)Business research: A practical guide for undergraduate and postgraduate students. London: Palgrave Macmillan Ltd. 2^nd ed.

Cooper, B.C., and Schindler, D.W. (2003)Business research methods. New York: McGraw Hill, 8^th ed.

Neuman, W. L. (2006)Social research methods: Qualitative and quantitative approaches.Boston: Pearson Education, Inc.6th ed.

Odukoya D. and Oladunjoye O. (2007) Research Methodology; Research Guidelines for undergraduate Students. Nigeria: University press, University of Lagos Akoka: Awoye Arts publicity. Pp 12 – 18

 

 

 

 

 

 

 

 

 

 

 

 

 

CHAPTER FOUR

 

DATA PRESENTATION, ANALYSIS AND INTERPRETATION

 

4.1       INTRODUCTION

This chapter introduces presentation of data gathered from the administered questionnaire among the 200 respondents used as sample for this study. The gathered data presented in tabular form. Statistical package for Social Sciences (SPSS 17.0) was used to analyse the data in frequency and percentage tables. The data were also interpreted and the chi square statistical test was used to test the stated hypotheses.

 

 

 

 

 

 

 

 

 

 

 

 

 

4.2       PRESENTATION AND ANALYSIS OF QUESTIONNAIRE

Table 1: Respondents’ Demographic Information

Parameter	Frequency	Percentage
Sex Male Female	138 62	69 31
Age (years) 21 – 30 31 – 40 41 – 50 Above 50	121 65 11 3	60.5 32.5 5.5 1.5
Education FSLC SSCE HND/BSC Postgraduate Others	– – 115 78 7	– – 57.5 39 3.5
Position at Work Top Manager Senior Manager Junior Manager	31 72 97	15.5 36 48.5
Years of Experience 0 – 5 years 6 – 10 years 11 – 15 years 16 – 20 years 20+ years	53 68 39 31 9	26.5 34 19.5 15.5 4.5

 

Table 1 shows responses according to respondent’s socio – demographic information. Out of the 200 respondents used as sample for this study, 138 respondents representing 69% are male while 62 respondents representing 31% are female. 121 respondents representing 60.5% were within age group 21 – 30 years while the lowest (1.5%) were above 50 years. In term of level of education, 115 respondents representing 57.5% indicated they are first degree holders (Graduate), while the lowest (3.5%) indicated they have other qualifications.  97 respondents representing 48.5% indicated that they are junior managers, while the lowest (15.5%) said they are top managers. Concerning years of experience, 68 respondents representing 34% indicated that they worked between 6 – 10 years, while the lowest (4.5%) said they have worked above 20 years.

Table 2. Do you know the theme of Corporate Social Responsibility (corporate social responsibility)?

Parameter	Frequency	Percentage
I know very well the principles and instrument of corporate social responsibility and my company apply them.	200	100
I don’t know so well that topic	–	–
I have never heard about that	–	–

 

Table 2 shows respondents responses to knowledge about corporate social responsibility. All respondents (100%) indicated that they know the principle and instrument of corporate social responsibility and their companies applied them.

Table 3. Which is the area of social responsibility more significant for your company?

Parameter	Frequency	Percentage
Governance and dialogue with the stakeholders	27	13.5
Policy towards employees	42	21
Relationship with clients and suppliers	48	24
Relationship with the community	61	30.5
Environment protection	22	11

 

Table 3 shows respondents’ responses to area more signifcant in corporate social responsibility. Out of the 200 questionnaire administered, 61 respondents representing 30.5% indicated that relationship with the community is more significant in the implementation of corporate social responsibility in their companies, while the lowest (11%) indicated that environment protection is more significant.

Table 4. In your opinion what motives your company to adopt corporate social responsibility practices?

Parameter	Frequency	Percentage
Promote corporate image/reputation	74	37
Increase of the efficiency	23	11.5
Greater customers loyalty and increase patronage	51	25.5
Corporate advantages in performance and profitability	22	11
Benefit in relationship with institution finance and community	30	15

 

Table 4 shows respondents’ responses to what motives adoption of corporate social responsibility. Out of the 200 questionnaire administered, 74 respondents representing 37% affirmed that promotion of corporate image and reputation influenced the adoption of corporate social responsibility practices in their companies, while 22 respondents representing 11% indicated that corporate advantage in performance and profitability is the major reason for adopting corporate social responsibility.

Table 5. My company has adequate manpower to implement and oversee the corporate social responsibility initiatives.

Parameter	Frequency	Percentage
Strongly Agree	113	56.5
Agree	87	43.5
Undecided	–	–
Disagree	–	–
Strongly Disagree	–	–

 

Table 5 shows respondents’ responses according to implement and oversees of the corporate social responsibility initiatives. All respondents affirmed that their companies have adequate manpower to implement and oversees the corporate social responsibility initiatives as indicated by 56.5% and 43.5%.

 

Table 6. Adequately trained staff takes care of the implementation of corporate social responsibility activities.

Parameter	Frequency	Percentage
Strongly Agree	88	44
Agree	112	56
Undecided	–	–
Disagree	–	–
Strongly Disagree	–	–

 

Table 6 shows respondents’ responses according to implement of corporate social responsibilityactivities. All respondents affirmed that adequately trained staff takes care of the implementation of corporate social responsibility activities in their companies as indicated by 44% and 56%.

 

Table 7. My company allocates appropriate budget for its various corporate social responsibility initiatives.

Parameter	Frequency	Percentage
Strongly Agree	64	32
Agree	136	68
Undecided	–	–
Disagree	–	–
Strongly Disagree	–	–

 

Table 7 shows respondents’ responses according to budget for corporate social responsibility initiatives. All respondents affirmed that their companies allocates appropriate budget for their various corporate social responsibility initiatives as indicated by 32% and 68%.

 

Table 8. The current corporate social responsibility activities are good enough for my company.

Parameter	Frequency	Percentage
Strongly Agree	75	37.5
Agree	125	62.5
Undecided	–	–
Disagree	–	–
Strongly Disagree	–	–

 

Table 8 shows respondents’ responses according to current corporate social responsibility activities. All respondents affirmed that their companies’ current corporate social responsibility activities are good enough as indicated by 37.5% and 62.5%.

 

Table 9. The company’s corporate social responsibility initiatives are helping in creating brand awareness.

Parameter	Frequency	Percentage
Strongly Agree	89	44.5
Agree	111	55.5
Undecided	–	–
Disagree	–	–
Strongly Disagree	–	–

 

Table 9 shows respondents’ responses according to corporate social responsibility initiatives and brand awareness. All respondents affirmed that their companies’ corporate social responsibility initiatives are helping in creating brand awareness as indicated by 44.5% and 55.5%.

 

 

 

Table 10. More people are willing to work for my company due to its initiatives for the society.

Parameter	Frequency	Percentage
Strongly Agree	73	36.5
Agree	97	48.5
Undecided	6	3
Disagree	17	8.5
Strongly Disagree	7	3.5

 

Table 10 shows respondents’ responses according to corporate social responsibility initiatives and willingness to work. 97 respondents representing 48.5% agreed that more people are willing to work with their companies because of their various corporate social responsibility initiatives, while 7 respondents representing 3.5% strongly disagreed.

 

Table 11. corporate social responsibility is an effective catalyst to bring about positive societal change.

Parameter	Frequency	Percentage
Strongly Agree	73	36.5
Agree	127	48.5
Undecided	–	–
Disagree	–	–
Strongly Disagree	–	–

 

Table 11 shows respondents’ responses according to corporate social responsibility initiatives and societal change. All respondents agreed that corporate social responsibility is an effective catalyst to bring about positive societal change as indicated by 36.5% and 48.5%.

 

Table 12. corporate social responsibility better community relations result in better profit for the company.

Parameter	Frequency	Percentage
Strongly Agree	69	34.5
Agree	131	65.5
Undecided	–	–
Disagree	–	–
Strongly Disagree	–	–

 

Table 12 shows respondents’ responses according to corporate social responsibility initiatives and better profit. All respondents agreed that corporate social responsibility better community relations result in better profit for their companies as indicated by 34.5% and 65.5%.

Table 13. Corporate social responsibility (corporate social responsibility) influences organisational reputation in the Nigerian manufacturing industry

Parameter	Frequency	Percentage
Strongly Agree	167	83.5
Agree	27	13.5
Undecided	2	1
Disagree	3	1.5
Strongly Disagree	1	0.5

 

Table 13 shows respondents’ responses according to influence of corporate social responsibility on organisational reputation. 167 respondents representing 83.5% strongly agreed that corporate social responsibility (corporate social responsibility) influences organisational reputation in the Nigerian manufacturing industry, while 1 respondent representing 0.5% strongly disagreed.

Table 14. Do you think that the Nigerian economic condition has encouraged the adoption of corporate social responsibility practices in your company?

Parameter	Frequency	Percentage
Very much	132	66
Pretty much	52	26
Not at all	7	3.5
Indifferent	3	1.5
I don’t know	6	3

 

Table 14 shows respondents’ responses according to influence of economic condition on adoption of corporate social responsibility. 132 respondents representing 66% indicated that the Nigerian economic condition encouraged the adoption of corporate social responsibility practices in their companies very much, while 3 respondents representing 1.5% were indifferent about the influence of economic condition on corporate social responsibility practices.

 

 

 

 

Table 15. Do you think corporate social responsibility affects the image of company’s before the general public?

Parameter	Frequency	Percentage
Strongly Agree	158	79
Agree	38	19
Undecided	1	0.5
Disagree	2	1
Strongly Disagree	1	0.5

 

Table 15 shows respondents’ responses according to influence of economic condition on adoption of corporate social responsibility. 132 respondents representing 66% indicated that the Nigerian economic condition encouraged the adoption of corporate social responsibility practices in their companies very much, while 3 respondents representing 1.5% were indifferent about the influence of economic condition on corporate social responsibility practices.

 

Table 16. In which of the following areas your company has realized significant operations?

Parameter	Frequency	Percentage
System of governance transparency and relationship with investors and share holders	30	15
Health and development of employees	41	20.5
Practices of responsible business	28	14
Climatic changes	59	29.5
Partnership with community	42	21

 

Table 16 shows respondents’ responses according to areas of significant operations. 59 respondents representing 29.5% indicated that climatic changes are the major significant areas of in their corporate social responsibility operations, while 28 respondents representing 14% indicated practices of responsible business are significant areas in their operations.

 

Table 17. Which of the following measures has your company adopted to reduce environmental impact?

Parameter	Frequency	Percentage
Energy Saving	4	2
Waste recycling	11	5.5
Mobility management (Car Pooling, Car sharing)	8	4
Sustainable Environment packaging	79	39.5
Development of environment friendly products	22	11
Life cycle Assessment processes	7	3.5
Management of environment system	57	28.5
Use of renewable resources	12	6

 

Table 17 shows respondents’ responses according to measures for reducing environmental impacts. 79 respondents representing 39.5% indicated that sustainable environment packaging are the major measures used by companies to reduce environmental impacts, while 7 respondents representing 3.5% indicated practices life cycle assessment processes are the major measures.

Table 18. Which are concrete actions towards community in which your company operates?

Parameter	Frequency	Percentage
Donation to organizations having social or environmental utility	37	18.5
Sponsorship of sport and cultural events	65	32.5
Cause Related Marketing campaign	6	3
Partnership projects of social solidarity	81	40.5
Corporate foundation	7	3.5
Corporate voluntary	4	2
None	–	–

 

Table 18 shows respondents’ responses according to concrete actions of corporate social responsibility practices. 81 respondents representing 40.5% indicated that partnership projects of social solidarity are the major concrete actions companies used as corporate social responsibility practices, while 4 respondents representing 2% indicated corporate voluntary are the major concrete actions.

 

Table 19. Which are concrete actions towards community in which your company operates?

Parameter	Frequency	Percentage
Donation to organizations having social or environmental utility	37	18.5
Sponsorship of sport and cultural events	65	32.5
Cause Related Marketing campaign	6	3
Partnership projects of social solidarity	81	40.5
Corporate foundation	7	3.5
Corporate voluntary	4	2
None	–	–

 

Table 19 shows respondents’ responses according to concrete actions of corporate social responsibility practices. 81 respondents representing 40.5% indicated that partnership projects of social solidarity are the major concrete actions companies used as corporate social responsibility practices, while 4 respondents representing 2% indicated corporate voluntary are the major concrete actions.

 

Table 20. There is a significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry.

Parameter	Frequency	Percentage
Strongly Agree	118	59
Agree	19	9.5
Undecided	7	3.5
Disagree	43	21.5
Strongly Disagree	13	6.5

 

 

Table 20 shows respondents’ responses according to influence of corporate social responsibility on level of perceived customers’ patronage and loyalty. 118 respondents representing 59% strongly agreed that there is a significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry, while 13 respondent representing 6.5% strongly disagreed.

 

Table 21. Corporate social responsibility adoption influences organisational performance and profitability.

Parameter	Frequency	Percentage
Strongly Agree	149	74.5
Agree	39	19.5
Undecided	2	1
Disagree	6	3
Strongly Disagree	4	2

 

Table 21 shows respondents’ responses according to influence of corporate social responsibility organisational performance and profitability. 149 respondents representing 74.5% strongly agreed that corporate social responsibility adoption influences organisational performance and profitability, while 4 respondent representing 2% strongly disagreed.

 

 

Table 22. What do you think could be the main benefit of the adoption of measures for social responsibility?

Parameter	Frequency	Percentage
Enhancing corporate reputation	89	44.5
Improving relations with suppliers, institution, donors, community	53	26.5
To strengthen the sense of employee	32	16
Acquisition of commercial benefits	14	7
Identification of reputational risks	12	6

 

Table 22 shows respondents’ responses according to main benefit of corporate social responsibility adoption. 89 respondents representing 44.5% indicated that enhancing corporate reputation are the main benefits for adoption of corporate social responsibility, while, 12 respondent representing 6% indicated that identification of reputational risks are the main benefits.

 

Table 23. Which are in your opinion problems related to the development of initiatives in the field of social responsibility by your company?

Parameter	Frequency	Percentage
Lack of knowledge	57	28.5
Lack of institution assistance	41	20.5
Lack of specific legislation on corporate social responsibility	38	19
Business benefits not immediate	24	12
High Cost	17	8.5
Lack of corporate skill	13	6.5
Little impact on social and environmental business	7	3.5
Few interest of the company	3	1.5

 

Table 23 shows respondents’ responses according to problems related to the development of corporate social responsibility adoption. 57 respondents representing 28.5% indicated that lack of knowledge are the main problems related to development of corporate social responsibility, while, 3 respondent representing 1.5% indicated that few interest of their companies.

 

Table 24. Economical, social and environmental factors influence the performance of corporate social responsibility.

Parameter	Frequency	Percentage
Strongly Agree	129	64.5
Agree	41	20.5
Undecided	2	1
Disagree	21	10.5
Strongly Disagree	7	3.5

 

Table 24 shows respondents’ responses according to factors influencing performance of corporate social responsibility. 129 respondents representing 64.5% strongly agreed that economical, social and environmental factors influence the performance of corporate social responsibility, while 7 respondent representing 3.5% strongly disagreed.

 

Table 25. corporate social responsibility activities in my company over the years have been influenced by some socio-economic factors.

Parameter	Frequency	Percentage
Strongly Agree	143	71.5
Agree	38	19
Undecided	2	1
Disagree	15	7.5
Strongly Disagree	4	2

 

Table 25 shows respondents’ responses according to socio-economic factors of corporate social responsibility. 143 respondents representing 71.5% strongly agreed that corporate social responsibility activities have been influenced by socio-economic factors, while 4 respondent representing 2% strongly disagreed.

 

4.3       TEST OF HYPOTHESES

Hypothesis One

H₀:       Corporate social responsibility (corporate social responsibility) does not influence organisational reputation in the Nigerian manufacturing industry.

H₁:       Corporate social responsibility (corporate social responsibility) influences organisational reputation in the Nigerian manufacturing industry.

 

 

 

 

Data gathered from table 13 and 15

Observed (O)	Expected  (E)	O – E	(O – E)2	(O – E)2 E
167	162.5	4.5	20.25	0.125
27	32.5	-5.5	30.25	0.931
2	1.5	0.5	0.25	0.167
3	2.5	0.5	0.25	0.1
1	1	0	0	0
158	162.5	-4.5	20.25	0.125
38	32.5	5.5	30.25	0.931
1	1.5	-0.5	0.25	0.167
2	2.5	-0.5	0.25	0.1
1	1	0	0	0
Chi Square				2.646

See appendix II for expected frequency calculation

Degree of freedom

(Row – 1)(Column – 1)

(5 – 1)(2 – 1) = (4)(1) = 4

Using degree of freedom (4) against level of significance at 0.05 = 9.49

Decision – Since the calculate table value of chi square (2.646) is lesser than the tabulated chi square value (9.49), therefore the null hypothesis which states thatcorporate social responsibility (corporate social responsibility) does not influence organisational reputation in the Nigerian manufacturing industryis accepted and the alternative hypothesis is rejected.

Hypothesis Two

H₀:       There is no significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry.

H₁:       There is a significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry.

Data gathered from table 20 and 10

Observed (O)	Expected  (E)	O – E	(O – E)2	(O – E)2 E
118	95.5	22.5	506.25	5.301
19	58	-39	1521	26.22
7	6.5	0.5	0.25	0.039
43	30	13	169	5.633
13	10	3	9	0.9
191	95.5	22.5	506.25	5.301
97	58	-39	1521	26.22
6	6.5	0.5	0.25	0.039
17	30	13	169	5.633
7	10	3	9	0.9
Chi Square				76.2

See appendix II for expected frequency calculation

 

Degree of freedom

(Row – 1)(Column – 1)

(5 – 1)(2 – 1) = (4)(1) = 4

Using degree of freedom (4) against level of significance at 0.05 = 9.49

 

Decision – Since the tabulated chi square value (9.49) is lesser that the calculate table value of chi square (76.2), therefore the alternative hypothesis which states thatthere is a significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry is accepted and the null hypothesis is rejected.

 

Hypothesis Three

H₀:       Corporate social responsibility adoption does not influence organisational performance and profitability.

H₁:       Corporate social responsibility adoption influences organisational performance and profitability.

Data gathered from table 21 and 12

Observed (O)	Expected  (E)	O – E	(O – E)2	(O – E)2 E
149	109	40	1600	14.68
39	85	-46	2116	24.89
2	1	1	1	1
6	3	3	9	3
4	2	2	4	2
69	109	-40	1600	14.68
131	85	46	2116	24.89
0	1	-1	1	1
0	3	-3	9	3
0	2	-2	4	2
Chi Square				91.14

See appendix II for expected frequency calculation

Degree of freedom

(Row – 1)(Column – 1)

(5 – 1)(2 – 1) = (4)(1) = 4

Using degree of freedom (4) against level of significance at 0.05 = 9.49

 

Decision – Since the calculate table value of chi square (91.14) is greater than the tabulated chi square value (9.49) therefore the alternative hypothesis which states thatcorporate social responsibility adoption influences organisational performance and profitability is accepted and the null hypothesis is rejected.

Hypothesis Four

H₀:       Economical, social and environmental factors do not influence the performance of corporate social responsibility.

H₁:       Economical, social and environmental factors influence the performance of corporate social responsibility.

 

 

Data gathered from table 24 and 25

Observed (O)	Expected  (E)	O – E	(O – E)2	(O – E)2 E
129	136	-7	49	0.360
41	39.5	1.5	2.25	0.057
2	2	0	0	0
21	18	3	9	0.5
7	5.5	1.5	2.25	0.409
143	136	7	49	0.360
38	39.5	-1.5	2.25	0.057
2	2	0	0	0
15	18	-3	9	0.5
4	5.5	-1.5	2.25	0.409
Chi Square				2.652

See appendix II for expected frequency calculation

Degree of freedom

(Row – 1)(Column – 1)

(5 – 1)(2 – 1) = (4)(1) = 4

Using degree of freedom (4) against level of significance at 0.05 = 9.49

Decision – Since the calculate table value of chi square (2.652) is lesser than the tabulated chi square value (9.49) therefore the null hypothesis which states thateconomical, social and environmental factors do not influence the performance of corporate social responsibility is accepted and the alternative hypothesis is rejected.

4.4       DISCUSSION OF FINDINGS

Findings of the analysed data show majority (69%) of the respondents used for this study are male, were within age group 21 – 30 years (60.5%), are first degree holders (Graduate, 57.5%),  junior managers (48.5%) and have worked between 6 – 10 years (34%).

Findings of the analysed data show that all respondents (100%) indicated that they know the principle and instrument of corporate social responsibility and their companies applied them.  Relationship with the community is more significant in the implementation of corporate social responsibility (30.5%), promotion of corporate image and reputation influenced the adoption of corporate social responsibility practices (37%), and companies have adequate manpower to implement and oversee the corporate social responsibility initiatives as indicated by 56.5% and 43.5%.

Findings of the analysed data show that adequately trained staff takes care of the implementation of corporate social responsibility activities in their companies as indicated by 44% and 56%. Companies allocates appropriate budget for their various corporate social responsibility initiatives as indicated by 32% and 68%, and the companies’ current corporate social responsibility activities are good enough as indicated by 37.5% and 62.5%. Companies’ corporate social responsibility initiatives are helping in creating brand awareness as indicated by 44.5% and 55.5%.

Findings of the analysed data show that more people are willing to work with their companies because of their various corporate social responsibility initiatives (48.5%) and corporate social responsibility is an effective catalyst to bring about positive societal change as indicated by 36.5% and 48.5%. corporate social responsibility better community relations result in better profit for their companies as indicated by 34.5% and 65.5%. Corporate social responsibility (corporate social responsibility) influences organisational reputation in the Nigerian manufacturing industry (83.5%) and the Nigerian economic condition encouraged the adoption of corporate social responsibility practices in their companies very much (66%).

Findings of the analysed data show that climatic changes are the major significant areas of in their corporate social responsibility operations (29.5%) and that sustainable environment packaging is the major measure used by companies to reduce environmental impacts (39.5%). Partnership projects of social solidarity are the major concrete actions companies used as corporate social responsibility practices (40.5%).

There is a significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry (59%).

Findings of the analysed data show that corporate social responsibility adoption influences organisational performance and profitability (74.5%), enhancing corporate reputation are the main benefits for adoption of corporate social responsibility (44.5%), lack of knowledge are the main problems related to development of corporate social responsibility (28.5%), economical, social and environmental factors influence the performance of corporate social responsibility (64.5%) corporate social responsibility activities have been influenced by socio-economic factors (71.5%).

 

 

 

 

 

 

CHAPTER FIVE

 

SUMMARY, IMPLICATIONS OF FINDING, CONCLUSION AND RECOMMENDATIONS

5.1       INTRODUCTION

This chapter providessummary of major findings and also make necessary conclusion based on the findings of the study. The study also states the usefulness of the study and makes necessary recommendations for the study. The study also states other areas where other researcher can still look into in order to buttress the findings of the study.

 

5.2       SUMMARY

The study examines the problems and prospects of corporate social responsibility of Nigerian manufacturing industry. Chapter one provided the introductory part by giving a background of the study. The chapter discussed the statement of the research problem. The chapter also highlighted the research questions and hypotheses raised based on the purpose of the study.  The limitations and significance of the study were also stated.

Chapter two-reviewed related literature on problems and prospects of corporate social responsibility of Nigerian manufacturing industry. The chapter will look at different authors’ definitions of corporate social responsibility and its activities affects organisations’ reputation, customers’ patronage and brand loyalty. The chapter also looked at how corporate social responsibility adoption influences organisational performance and profitability. How economical, social and environmental factors are responsible for the poor performance of corporate social responsibility (corporate social responsibility) adoption were also extensively reviewed.

Chapter three discussed the research methodology. The chapter stated the type of research designed adopted in the study. A sample size of 200 respondents was randomly selected from ten manufacturing companies. Questionnaire was administered among the respondents for the purpose of data collection.

 

Chapter four presented the data gathered in frequency and percentage tables. The data were also analysed and research hypotheses were tested with chi-square statistical test.

 

5.3       IMPLICATION OF THE STUDY

This study provided adequate approaches in academic clarification on the impact problems and prospects of corporate social responsibility and how it might lead to the efficiency performance in organisations. The study will be useful to all organisations especially those in the financial and manufacturing sector as the sector contributes mostly to the growth and development of any economy.

 

 

 

 

 

 

 

 

 

5.4       CONCLUSION

Sequel to the findings of the study, the following conclusion were drawn based of the findings of the study;

• Relationship with the community is more significant in the implementation of corporate social responsibility, the promotion of corporate image and reputation influenced the adoption of corporate social responsibility practices and companies have adequate manpower to implement and oversee the corporate social responsibility initiatives.
• Adequately trained staff takes care of the implementation of corporate social responsibility activities and most companies allocates appropriate budget for their various corporate social responsibility initiatives.
• Most companies’ current corporate social responsibility activities are good enough and their corporate social responsibility initiatives are helping in creating brand awareness.
• corporate social responsibility is an effective catalyst to bring about positive societal change andcorporate social responsibility better community relations result in better profit for companies.
• The Nigerian economic condition encouraged the adoption of corporate social responsibility practices in their companies very much.
• Climatic changes are the major significant areas of in their corporate social responsibility operations and that sustainable environment packagingis the major measure used by companies to reduce environmental impacts.
• Partnership projects of social solidarity are the major concrete actions companies used as corporate social responsibility practices.
• Enhancing corporate reputation are the main benefits for adoption of corporate social responsibility.
• Lack of knowledge is the main problem related to development of corporate social responsibility.

 

Tested hypotheses show that;

• Corporate social responsibility (corporate social responsibility) does not influence organisational reputation in the Nigerian manufacturing industry.
• There is a significant difference between level of perceived customers’ patronage and loyalty among companies that practices corporate social responsibility and those that doesn’t in the Nigerian manufacturing industry.
• Corporate social responsibility adoption influences organisational performance and profitability.
• Economical, social and environmental factors do not influence the performance of corporate social responsibility.

 

5.5       RECOMMENDATIONS

For enhancing the e-commerce implementation, this research recommended several important points:

• Leaders are tasked to ensure the organisation adoption of corporate social responsibilityis at an optimal level; they are expected to communicate the usefulness of corporate social responsibility adoption throughout the organisation.
• Employees should be properly trained and educated, in order to maximize benefits of corporate social responsibility to enhance rapid improvement of corporate reputation and business delivery system.
• Studies and surveys, such as those used for the present research study, form one method for giving organisations the skills, tools, and information necessary to understand the corporate social responsibility initiative. As global markets continue to evolve, organisations merge, and the competitive landscape continues to change, organisations have to be flexible and adaptable to these events.
• Organisations must put in place market parameters that will enable them to be informed about being socially responsible to make corporate social responsibility adoption successful and to make industrial products meet expected economic, social and environmental needs.
• Key stakeholders at every level should have the same focus and concern if they want to be effective and successful in an organisation. Organisations should know or realize that corporate social responsibility is the means by which the organisation achieves the corporate mission and goals.
• Organisations should continue to monitor and maintain a positive adoption and implementation of corporate social responsibility which could reduce attrition within the organisation; this could contribute to increases in organisational efficiencies.

 

5.6       SUGGESTIONS FOR FURTHER STUDIES

This study examines the problems and prospects of corporate social responsibility of Nigerian manufacturing industry. The study used a sample of two hundred (200) employees from ten (10) manufacturing companies in Lagos State. It is suggested that further studies can still be carried out on corporate social responsibility within the case study by using a larger sample size or further studies to be carried out to examine the impact of corporate social responsibility on organisational sales performance.

BIBLIOGRAPHY

Achua, J.K (2008), Corporate Social responsibility in Nigerian Banking system. Society and Business Review Vol. 3 No.1 Emerald Group Publishing Limited.

Amaeshi, K. M., Adi, A.B. C., Ogbechie, C. and Amao, O. O. (2006). Corporate Social Responsibility in Nigeria: Western Mimicry Or Indigenous Influences? Available at:SSRN: http://ssrn.com/abstract=896500

Bendixen, E. W., and Abratt, C.L. (2007). “Customer satisfaction and shareholder value.” Journal of Marketing: 172-185.

Bhattacharya, C.B. and Sen, S. (2004). Doing Better at Doing Good: When, Why, and How Consumers Respond to Corporate Social Initiatives. California Management Review, Vol. 47 No. 1, pp. 9-24.

Black, D. (1989). Managing organisations in Africa. Walter de Gruyter, pp.169-171.

Bowman E. H, and Haire M. (2008). “A strategic posture toward corporate social responsibility”. California Manage. Rev. 18(2): pp 49-58.

Bromley, T. J. (2001). The company and the product corporate associations and consumer product responses. The Journal of Marketing 61(1): 68–84.

Business Day(2003). “Cadbury Nigeria Plc Rolls Out more Corporate Social Responsibility Projects in 20^th century. PP 12

Carpenter, T. Andrew,A.D.,  Da-silva, B. (2010): Corporate Social Responsibility in India- An Empirical Research. [Online] Available: http://www.EzineArticles.com

Carroll, A.B. (1979). A Three-dimensional Conceptual Model of Corporate Performance. Academy of Management Review, Vol. 4, No. 4, pp. 497-505.

Carroll A.B. and Buchholtz, R. (2003): “The pyramid of corporate social responsibility: toward the moral management of organisational stakeholders”, Business Horizon, Vol. 34 No. 4, pp 39-48.

Chiejina A (2011). “How to Deploy CRS to Benefit Host Communities”. Business Day, May 10. P19.

Charles, P. (2010). Companies look at corporate social responsibility initiatives for branding slump. http://www.livemint.com/2009/02/08111815/Companies-look-at-corporate social responsibility-initiati.html (accessed 24 December, 2012).

Chi-Shiun Lai, Ettlie, J. E. and A. H. Rubenstein (2010). “Firm size and product innovation.” Journal of Product Innovation Management4(2): 89-108.

Collis, J., and Hussey, R. (2003). Business research: A practical guide for undergraduate and postgraduate students (2nd ed). London: Palgrave Macmilla

Cooper, B.C., and Schindler, D.W. (2003). Business research methods (8^th ed). New York: McGraw Hill

Cornell, S. and Shapiro, M. (2007). Understanding the Influence of corporate social responsibility on Corporate Identity, Image, and Firm Performance. Management Decision, Vol. 48, No.10, pp.1469–1492.

Davis, K. (1960). Corporate Social Responsibility and organizational Profitability”. J. Econ. Soc. Res.3(1):113-124.

Dean, D. H. (2008). “Consumer perception of corporate donations effects of company reputation for social responsibility and type of donation.” Journal of Advertising32(4): 91-102.

Detomasi, D. A. (2008). The political roots of corporate social responsibility. Journal of Business Ethics, 82, 807-819.

Eells, S and Walton, T (1961). The path to corporate responsibility, HBR, December, 2004, pp. 125-132.

European Foundation for Quality Management (EFQM, 2007). EFQM internal report. http://www.efqm.com.my/aboutdigi/cr/cr_news.  doc (accessed 22 December, 2012).

Fombrun, T.M (2006). Shareholder value, stakeholder management, and social issues: What’s the bottom line?” Strategic Management Journal, 22 (2): 125-139.

Friedman, (2008) The social responsibility of business in to increase its profits. New York Times Magazines, 13 Sept., 32-33.

Frooman, J. D. (1997). “Strategic philanthropy: responding to negative portrayals of corporate social responsibility.” Corporate Reputation Review3(2): 124-136.

Garriga F. and Mele, S. (2004). Corporate Social responsibility as Risk Management: A model for Multinationals. Social Responsibility Initiative Working Paper, No.10. Cambridge MA. John F. Kennedy School of Government, Harvard University.

Gray, R. and Balmer, D. (1998). Social and Environmental.Disclosure and Corporate Characteristics: A Research note and Extension. Journal of Business Finance and Accounting, 28 (3 &4), pp.327-356.

Guenster, H., Rettab, E., Brik, P. and Mellahi, T. (2005). Corporate social responsibility – a PR invention?, Corporate Communication. An International Journal, Vol. 6 No. 1, 2001, pp. 18-23.

Hamilton, D., Griffin, J.J. and Mahon, J.F. (2003). “The Corporate Social Performance and Corporate Financial Performance Debate: Twenty-Five Years of Incomparable Research.” Business and Society. 36: pp 5-31.

Herremans, T., Collier, T., De Man, F. and Kahn, T. (2003). Corporate social responsibility and its impact on corporate reputation, Brand Strategy (Sept), Issue 195, p. 40-41.

Jamali, G.  (2006). “Corporate social responsibility: A three-domain approach.” Business Ethics Quarterly: 503-530.

Jamali, G. and Mirshak, S. (2007). “The Impact of Product Recalls on the Wealth of Sellers,” Journal of PoliticalEconomics. 93(3) 512-536.

Jensen, R. A. (2002). Being good while being bad: Social responsibility and the international diversification of U.S. firms. Journal of International Business Studies, 37(6), 850–862.

Jones, D. R. (2005). “The effect of corporate social responsibility on corporate reputation.” Journal of Marketing: 16-32.

Litz, R. A. (1996). A resource-based view of the socially responsible firm: Stakeholder interdependence, ethical awareness, and issue of responsiveness as strategic assets. Journal ofBusiness Ethics, 15, 1355-1363.

Lodgson, J. M and Wood, D. J. (2002). Business citizenship: From individuals to organisations. Business Ethics Quarterly, Ruffin Series, 3, 59-94.

Lohmans, G and Steinholtz, P. (2004). The Boundaries of Strategic Corporate Social Responsibility. Journal of Consumer Marketing, Vol. 18, No. 7, pp 595-630.

Mackey, A., Mackey, T. B., and Barney, J. B. (2007). Corporate social responsibility and firm performance: Investor preferences and corporate strategies. Academy of Management Review, 32(3), 817–835.

Mahon, M. (2002). Social responsibility and impact on society, The TQM Magazine, Vol. 12, No. 3, pp. 172-178.

Manne, I., O. (2006). A stakeholder model for implementing social responsibility in marketing. European Journal of Marketing 39(9/10): 956-977.

Matten, R.K. and Moon, N.S (2004). An analysis of linkage between economic value added and corporate social responsibility”, Management Decision, 46(9): 1437-1443.

McWilliams, A and Siegel, D. (2000). Research notes and communications. Corporate social responsibility and financial performance: correlation or misspecification?’, StrategicManagement Journal, vol 21, pp 603-9.

Miles, D. J. (1987). “Corporate social performance revisited.” Academy of management review: 691-718.

Neuman, W.L. (2006). Social research methods: Qualitative and quantitative approaches (6th ed).Boston: Pearson Education, Inc.

Nkanga, E. (2007). Nigeria: Telecom Operators and Corporate Social Responsibility. This Day, 31st Jan, 2007.www.google.adservices.com.

Odukoya D and Oladunjoye O. (2007): Research Methodology; Research Guidelines for undergraduate Students. University of Lagos Akoka: Awoye Arts publicity. Pp 19–23.

Onwuegbuchi, D.K. (2004). “The relationship Between Perceptions of corporate citizenship and Organisational Commitment.” Business and society, Vol. 43 no. 3: pp 296-319, Sage Publications.

Porter, R. and Cramer, G. (2002). Social capital in firm-stakeholder networks: A corporate role in community development. Journal of Corporate Citizenship, 26, 121–134.

Quazi, E. and O’Brien, T. (2008). Evaluate Corporate Social Responsibility. Disclosure Annual Report Companies in Multifarious Group of Industry Members of Jakarta Stock Exchange, Indonesia. Social Responsibility Journal, 4(3) Emerald Group Publishing Ltd.

Salawu R. O. (2007).“Corporate Social Responsibilities: Evidence from oil companies in Nigeria”.Nig. J. Bus.Soc Sc; 1(1): 31-42. University of Lagos, Lagos.

Shane L. and Spicer D. (1983). “The corporate social-financial performance relationship.” Bus. Soc. 36: pp 419-429

Simpson, W. G. and Kohers, T. (2002). “The Link between Corporate Social and Financial Performance: Evidence from the Banking Industry,” J. Bus. Ethics. 35: pp 97-109

Singer, J. D.H (1970) “An empirical examination of the relationship between corporate social responsibility and profitability.” Academy of ManagementJournal, 28 (2): 446-463.

Wartick, A. (1992). Trend performance in credit financing of rural business activities in Nigeria: A case study of community banks in Ibadan, Oyo State. International Journal of Agriculture and Rural Development, 7 (1): 50-60.

Whetten, S.A, and Mackey, B.G (2002). “The corporation social performance – financial performance Link”. Strategic.Management. Journal. 18 (4) 303-319

Williams, T. and Barrett, P. (2000). “Making Corporate Social Responsibility (corporate social responsibility) Operable: HowCompanies Translate Stakeholder Dialogue into Practice.” Business and Society Review, 111 (2), pp 137-163.