INFLUENCE OF CORPORATE SOCIAL RESPONSIBILITY ON COMPETITIVE ADVANTAGE AND PROFITABILITY OF SMALL AND MEDIUM ENTERPRISES IN SOUTH WEST, NIGERIA.
Abstract
Corporate Social Responsibility (CSR) is considered as a performance tool for organizations, particularly small and medium-sized enterprises (SMEs), as it improves many aspects of performance, such as economical, social, and environmental results. It is on this premise that this study examined the influence of corporate social responsibility (CSR) on enterprise competitiveness, and profitability of small and medium enterprises in manufacturing sector in South-West, Nigeria. The study adopted a descriptive survey research design. The population of the study is 14,664 comprising small and medium enterprise manufacturers registered with Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) in the south-west states, Nigeria. The sample size for this study comprised 282 respondents who successfully completed and returned copies of questionnaire distributed to them. The researcher used multi-stage stratified random sampling technique. Mean and standard deviation were used to analyze research questions. The null hypotheses were tested using Independent sample t-test at 0.05 level of significance. The findings of the study revealed that implementation of CSR among SMEs in manufacturing sectors were rated high in enterprise competitive advantage, and profitability. Further to this, there was no statistically significant difference in the ratings of male and female respondents as regards the influence of corporate social responsibility on enterprise competitive advantage of SMEs, and in the ratings of rural and urban respondents on influence of corporate social responsibility on profitability. Based on the findings, recommendations were proffered that SMEs should position their CSR efforts as a unique selling proposition (USP) to widen their competitive advantage over others, and at the same time develop mechanisms to track and measure the outcomes of their CSR initiatives, as this will help them assess the profitability/return on investment, understand what works, and make informed decisions about future CSR activities.
Keywords: Corporate Social Responsibility, Enterprise Competitive Advantage, Profitability, Small and Medium Enterprises.
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