Exploring Corporate Social Responsibility and its Relationship with Corporate Performance in Malawi

Abstract

Corporate social responsibility (CSR) continues to be debated upon by scholars and business practitioners. The study assessed the prevalence of CSR in Malawi and its relationship with financial performance of firms. 100 respondents being officers, managers and directors of 40 firms from 10 private sector industries participated in the study in which they provided responses to a questionnaire on various aspect of CSR. Content analysis of data received reveal the prevalence of CSR programmes by organisations in Malawi with all the 40 firms surveyed involved in CSR initiatives. CSR activities are concentrated in the social and physical dimensions. The study found that CSR activities are more pronounced in health with 80 percent of firms involved, 72 percent in education, 64 percent in physical infrastructure development, 56 percent in environmental conservation and 32 percent in girl child and orphanage support. None of the surveyed firms focused on CSR activities in supply chain, customer and/or employee relations dimensions. The main reasons for engaging in CSR activities were to give back to the community with 93 percent of the surveyed firms and 86 percent considering CSR as part of a marketing strategy to gain publicity and build corporate image. The study further found that managers of firms surveyed perceived that there was no relationship between the CSR activities their firms engaged in and the firms' financial performances despite a smaller percentage of respondents acknowledging the effect CSR activities had in increasing operating costs of their firms.