The impact of corporate social responsibility factors on the competitiveness of small and medium-sized enterprises

Abstract

Corporate social responsibility (CSR) has become increasingly important to the competitiveness of small and medium-sized enterprises (SMEs). A positive relationship between the CSR activities of SMEs and their enhanced competitiveness exists, at least if a long-term perspective is adopted (European Competitiveness Report, 2008:106; Mandl & Dorr, 2007:2). Despite the widespread practical and academic interest in CSR and its impact on the competitiveness of SMEs, few theoretical and empirical contributions could be found. The primary objective of this study was to identify and empirically test the CSR factors influencing the competitiveness of SMEs in Uganda. The outcomes of this study will assist SMEs to effectively and responsibly manage their activities to increase their competitiveness. A structured, self-administered questionnaire was distributed to 750 potential SME respondents. The respondents were identified by means of a purposive sampling technique, and the data were collected from 383 usable questionnaires. An exploratory factor analysis was carried out, and Cronbach’s alpha coefficients calculated to determine the discriminant validity and reliability of the measuring instrument. Correlations were assessed using structural equation modeling. The empirical results of this study indicate that workforce-oriented CSR activities, society-oriented CSR activities, market-oriented CSR activities and regulated CSR activities significantly influence the competitiveness of SMEs.