Incorporating Islamic Value in Corporate Social Responsibility (CSR) Practice of Malaysia Small Medium Enterprises (SMEs) Food Operators: Does Manager’s Religiosity Influence CSR Practice?

Abstract

While corporate social responsibility (CSR) practice has long received considerable attention in the food and agricultural research arena, empirical studies on CSR practice of food companies involving small and medium enterprises (SME) are still scarce. Given the importance of CSR implementation among SMEs, there is a need for a study to show how CSR affects the corporate reputation of the companies. Therefore, this study aims to investigate the extent to which CSR practices are influenced by the level of organizational policy and managers’ religiosity among local SMEs food operators and its impact on corporate reputation. This study employed a survey method, and the sampling frame for this study was drawn from the list of food manufacturers registered with the Small and Medium Industries Development Corporation (SMIDEC) in Malaysia. A total of 264 questionnaires were analyzed by using PLS-SEM. This study found that organizational policy and managers’ religiosity had significant relationship with CSR practice. This research has important implications to regulators, listed firms, consumers, and capital market participants. Although it is much more complex to identify, investigate and communicate CSR in the small business, this area deserves more attention due to its potential impact on the global economy.