ST. AUGUSTINE UNIVERSITY OF TANZANIA
FACULTY OF BUSINESS ADMINISTRATION
DEPARTMENT OF ACCOUNTING AND FINANCE
IMPACT OF CORPORATE SOCIAL RESPONSIBILITY ON COMPANY'S
ECONOMIC SUSTAINABILITY : A CASE OF NYANZA BOTTLING
COMPANY LIMITED
A Dissertation in partial fulfillment of the requirements for the award of Master Degree
in Business Administration Submitted to the Faculty of Business Administration
JACKSON. Zacharia
(MBA 58778)
AUGUST, 2018
ii
DECLARATION
I declare that this research report has been a result of my effort. The contribution of the scholars
whose works have been integrated in this work does not extend any ownership right.
Jackson Zacharia MBA 58778 ....................................................
Date .....................................................
iii
CERTIFICATION
The undersigned certify that they have read and hereby recommend for acceptance by the
University of SAUT, a dissertation entitled: Impact of corporate social responsibility on
company's economic sustainability, in partial fulfillment of the requirements of Masters Degree
of Business Administration-Accounting of the University of SAUT.
Dr. Kaihula, Bishagazi
(SUPERVISOR)
.....................................................................................
Date..................................................
iv
COPYRIGHT
This work is protected by copyrights. No part of this dissertation/thesis may be reproduced,
stored in any retrieval system, or transmitted in any form or by any means, electronic,
mechanical photocopying, recording, or otherwise, without prior written permission of the author
or the St. Augustine university of Tanzania. Whoever infringes this right commits an offense and
will be subject to legal proceedings that attract significant consequences
© Jackson, Zacharia 2018
All rights reserved
v
DEDICATION
This dissertation is dedicated to my lovely wife, Mrs. Harrieth Zacharia Jackson and my son
Kendrick for their support and encouragement during the whole period of my study.
vi
ACKNOWLEDGEMENTS
This dissertation is a result of the support I received from many individuals and institutions.
Indeed, I wish I could mention all of them here but space is the limit. I express my heartfelt
thanks and appreciation to all individuals and institutions for their cooperation, assistance,
criticisms and encouragement that contributed to the accomplishment of this report. Allow me to
mention a few I could mention in this limited space.
First and foremost, I thank the Almighty God for bestowing me the power, strength and
knowledge that made me reach this important success in life.
My greatest debt is to my supervisors, Dr. Henry Ogoi and Dr. Kaihula Bishagazi who devoted
their time to read and comment on my work from the research proposal to the final report. Their
constructive and meaningful comments and suggestions made a significant contribution to the
quality of this dissertation. On the same line, I would also like to extend my gratitude to all MBA
lecturers for their directives during course of this study.
I would like to additionally register my appreciations to my family for their financial support that
enabled me to undergo my studies. On the same line, I feel the pleasure to express my sincere
appreciation to the respondents of this study, from NBCL-Mwanza staffs and customers. I thank
them for their mutual support in providing me with valuable data that contributed to the
accomplishment of this study.
Further, special thanks should also be extended to MBA classmates for their assistance in one
way or another, their guidance and moral support really encouraged me to reach at this high
level.
vii
I am extremely grateful to my family especially my beloved parents, Mr. Jackson Jeremiah and
Mrs. Marry Jackson. My lovely wife Harrieth Zacharia Jackson, my sibling, Marco Jackson
Jeremiah and my lovely sister Ruth Jackson Jeremiah disserve special thanks for their patience,
love and prayers that empowered me to reach this inspiring level of education.
Finally, I thank all friends who have always been with me in this journey and all the well wishers
who took their time to pray for my success and wish me well. I am also bound to acknowledge
the role played by my enemies whom I don't know. Their challenges have made me who I am.
However, it should be noted that, any shortcomings in this research entirely belong to me
viii
Table of Contents
DECLARATION ............................................................................................................................ ii
CERTIFICATION ......................................................................................................................... iii
COPYRIGHT ................................................................................................................................. iv
DEDICATION ................................................................................................................................ v
ACKNOWLEDGEMENTS ........................................................................................................... vi
ORGANISATION OF THE REPORT ......................................................................................... xii
LIST OF TABLES ....................................................................................................................... xiii
LIST OF FIGURES ..................................................................................................................... xiv
LIST OF ABBREVIATIONS ....................................................................................................... xv
ABSTRACT ................................................................................................................................. xvi
CHAPTER ONE ........................................................................................................................... 1
1.0 Introduction ........................................................................................................................... 1
1.1 Background to the study ........................................................................................................ 1
1.1.1 Historical Background of the Study ............................................................................... 1
1.1.2 Global trend .................................................................................................................. 10
1.1.3 Sub- Saharan Africa trend ............................................................................................ 11
1.1.4 Tanzania trend .............................................................................................................. 13
1.2 Significance of the study ..................................................................................................... 15
1.3 Statement of the Problem .................................................................................................... 15
1.4 Objective of the Study ......................................................................................................... 17
1.4.1 General Research Objective ......................................................................................... 17
1.4.2 Specific Objectives. ...................................................................................................... 17
1.5 Research Questions ............................................................................................................. 18
1.6 Variable of the study ........................................................................................................... 18
1.7 Scope of the study ............................................................................................................... 18
1.8 Definitions of key Terms..................................................................................................... 19
1.9 Conceptual framework ........................................................................................................ 21
CHAPTER TWO ........................................................................................................................ 24
LITERATURE REVIEW .......................................................................................................... 24
2.0 Introduction ......................................................................................................................... 24
ix
2.1 Theories of Corporate social responsibility on Company's economic sustainability .......... 24
2.1.1 Stakeholder Theory ....................................................................................................... 24
2.1.2 Social Contracts Theory ............................................................................................... 28
2.1.3 Legitimacy Theory ....................................................................................................... 30
2.2 Empirical literature Review ................................................................................................ 32
2.3 Knowledge Gap ................................................................................................................... 40
CHAPTER THREE .................................................................................................................... 43
RESEARCH METHODOLOGY .............................................................................................. 43
3.0. Introduction ........................................................................................................................ 43
3.1. Type of Research ................................................................................................................ 43
3.2 Research Design .................................................................................................................. 44
3.3 Area of Study ...................................................................................................................... 44
3.4 Population of the Study ....................................................................................................... 46
3.5 Sample Size ......................................................................................................................... 47
3.5 Sampling Frame .................................................................................................................. 48
3.6 Sampling technique. ............................................................................................................ 49
3.6 Nature of Data ..................................................................................................................... 49
3.6.1 Primary source .............................................................................................................. 49
3.6.2 Secondary Source ......................................................................................................... 50
3.7 Methods of Data collection ................................................................................................. 50
3.7.1 Questionnaire ................................................................................................................ 50
3.7.2 Interview Guide ............................................................................................................ 51
3.7.3 Documentary Review ................................................................................................... 51
3.7.4 Pilot Testing .................................................................................................................. 51
3.8 Data Analysis ...................................................................................................................... 52
3.9 Validity and Reliability ....................................................................................................... 52
3.9.1 Validity ......................................................................................................................... 53
3.9.2 Reliability ..................................................................................................................... 54
3.10 Ethical Concerns ............................................................................................................... 54
3.11 Study Funding ................................................................................................................... 55
x
CHAPTER FOUR ....................................................................................................................... 56
FINDINGS AND DATA ANALYSIS ........................................................................................ 56
4.0 Introduction ......................................................................................................................... 56
4.1. Descriptive results .............................................................................................................. 56
4.1.1 Questionnaire response rate .......................................................................................... 57
4.2. Response to Research objectives........................................................................................ 60
4.2.1 To examine the relationship between transparency and NBCL economic sustainability
in Tanzania. ........................................................................................................................... 60
4.2.2 To assess the relationship between accountability and NBCL economic sustainability
in Tanzania. ........................................................................................................................... 62
4.2.3 To find out the relationship between company's compliance and company's economic
sustainability at NBCL in Tanzania. ...................................................................................... 63
4.2.4 To examine resource management on company's economic sustainability at NBCL in
Tanzania. ................................................................................................................................ 64
4.2.5 To assess the economic sustainability of NBCL in Tanzania. ..................................... 65
CHAPTER FIVE ........................................................................................................................ 66
SUMMARY, CONCLUSION AND RECOMMENDATIONS .............................................. 66
5.0 Introduction ......................................................................................................................... 66
5.1 Summary of key Findings ................................................................................................... 66
5.1.1. To examine transparency on company's economic sustainability at NBCL in Tanzania.
............................................................................................................................................... 66
5.1.2. To assess accountability on company's economic sustainability at NBCL in Tanzania.
............................................................................................................................................... 67
5.1.3. To find out the relationship between company's compliance and company's economic
sustainability at NBCL in Tanzania. ...................................................................................... 69
5.1.4. To examine resource management on company's economic sustainability at NBCL in
Tanzania. ................................................................................................................................ 70
5.1.5. To assess the economic sustainability of NBCL in Tanzania ..................................... 71
5.2 Conclusion ........................................................................................................................... 72
5.2.1. To examine the relationship between transparency and company's economic
sustainability at NBCL in Tanzania ....................................................................................... 72
5.1.2. To assess accountability on company's economic sustainability at NBCL in Tanzania
............................................................................................................................................... 72
xi
5.1.3. To find out the relationship between company's compliance and company's economic
sustainability at NBCL in Tanzania ....................................................................................... 72
5.1.4. To examine resource management on company's economic sustainability at NBCL in
Tanzania ................................................................................................................................. 73
5.1.5. To assess the economic sustainability of NBCL in Tanzania ..................................... 73
5.3. Recommendations .............................................................................................................. 73
5.3.1. Recommendation to the organization .......................................................................... 73
5.3.2. Recommendation to Government ................................................................................ 74
5.4 Area of further research ................................................................................................... 74
REFERENCES ............................................................................................................................ 75
APPENDICES ............................................................................................................................. 80
Appendix I: Questionnaire for employees of Nyanza Bottling Company Limited (NBCL) .... 80
Appendix II: Questionnaire for customers of Nyanza Bottling Company Limited (NBCL) .... 84
Appendix III: A guide to customers of NBCL-Mwanza products around the Plant- Nyamagana
District ....................................................................................................................................... 87
xii
ORGANISATION OF THE REPORT
This report has been organized into five chapters. The first chapter presents the background of
the study, states the problem and identifies the objectives of the study from which the research
questions are drawn and finally presents the operational definition and conceptual framework.
The second chapter of this report presents the literature review covering theoretical and empirical
literature reviews. Research methodology has been discussed in chapter three. this chapter
mainly contains the design of the study and the test of validity and reliability. The fourth chapter
of this report contains findings and data analysis. This part involves data obtained and the way
that set of data is analyzed. The fifth chapter includes conclusion and recommendations
xiii
LIST OF TABLES
Table 3.1 Target Population .......................................................................................................... 46
Table 3.2 Sample size from target population .............................................................................. 48
Table 4.1.: Questionnaire response rate ........................................................................................ 57
Table 4.2: Profile of Respondents ................................................................................................. 57
Table 4.3: Description of the relationship between transparency and NBCL economic
sustainability ................................................................................................................................. 60
Table 4.4: Description of how Elements of transparency impact NBCL-Mwanza economic
sustainability ................................................................................................................................. 61
Table 4.5: Description of the relationship between Accountability and NBCL economic
sustainability ................................................................................................................................. 62
xiv
LIST OF FIGURES
Figure 1.1: Triple Bottom line and Company Sustainability .......................................................... 9
Figure 1.2: Types of Corporate Responsibilities .......................................................................... 20
Figure 1.3: Company Sustainability and Corporate Social Responsibility................................... 20
Figure 1.4: Conceptual framework ............................................................................................... 23
Figure 4.1: Description of the relationship between company's compliance and NBCL economic
sustainability ................................................................................................................................. 63
Figure 4.2: Description of how management of resource has brought about NBCL economic
sustainability ................................................................................................................................. 64
xv
LIST OF ABBREVIATIONS
CSDs Carbonated Soft Drinks
CSR Corporate Social Responsibility
CPCT Cleaner Production Centre of Tanzania
DNA Deoxyribonucleic Acid
EU European Union
FDI Foreign Direct Investment
MNCs Multi-National Companies
NGOs Non- Government Organizations
NBCL Nyanza Bottling Company Limited
PAYE Pay As You Earn
PET Plastic Bottles
RBV Resource Based View
RGB Refillable Glass Bottles
RECP Resource Efficient And Cleaner Production
SAUT St. Augustine University of Tanzania
SSA Sub- Saharan African
SDL Service Development Levy
TBL Triple Bottom Line
TNIP The National Investment Policy
TCCMs The Coca-Cola Management Systems
UK United Kingdom
VAT Value Added Tax
xvi
ABSTRACT
This study was about the impact of corporate social responsibility on company's economic
sustainability. References for this study were drawn from NBCL-Mwanza staffs and its
customers. The study sought to meet five objectives, namely; to examine the relationship
between and company's economic sustainability in Tanzania, to assess the relationship between
accountability and company's economic sustainability in Tanzania, is there a relationship
between company's compliance and company's economic sustainability in Tanzania, resource
management has anything to do with company's economic sustainability, What is the economic
sustainability of NBCL in Tanzania. The study employed mixed method approach where
quantitative and qualitative was both used descriptive cross-sectional research design. Data were
collected from participants who were NBCL-Mwanza staffs and its customers. Data and
information was gathered using questionnaire, interview guides and documentary review. The
analysis of the data obtained from the respondents revealed that corporate social responsibility
has contributed to the economic sustainability of NBCL-Mwanza. However, the test results
revealed that NBCL-Mwanza economic sustainability is influenced by corporate reporting but
the company has inadequate knowledge on corporate social responsibility reporting while the
government has shown inadequate support on promoting and supporting companies that engages
in corporate social responsibilities practices . This failure is said to be the result of transition
period that every part concerning with corporate social responsibility should adopt and learn to
integrate corporate social responsibility practices as an economic sustainability strategy of their
own. In addition, the results revealed that corporate social responsibility is a new strategy to
company‟s staffs and managers, they should be taught in how to make the best use of corporate
social responsibility in enhancing company's economic sustainability.
1
CHAPTER ONE
1.0 Introduction
This chapter presents the background of corporate social responsibility CSR from the global
perspective coming down to the country level, especially Tanzania. In addition, this chapter
identifies the significance of the study as well as stating the problem while pointing out the
objective of the study and research questions. Finally, the scope of the study is also identified
along with conceptual framework.
1.1 Background to the study
This section presents the historical background of corporate social responsibility CSR trend from
the global perspective coming down to the country level. The section extends its discussion to
include the awareness and implementation of CSR in Tanzania. Issues relating to the main
variables of the study were explored in details.
1.1.1 Historical Background of the Study
EU Commission (2002) defines CSR as the concepts whereby companies integrate social and
environmental concerns into their business operation and in their interaction with their
stakeholders in a voluntary basis. It was then seen as a voluntary actions that companies have an
option either to practice it or not. The growing number of researchers and scholars has argued
that, company operation do not only impact the insiders but also the outsiders likewise.
Aras & Crowther (2008), Company operation have an impact on the external environment since
business does not operates in isolation, that is to say company operation largely affect both
2
environment and society. Practicing corporate social responsibility shouldn't have been an
optional or voluntary deeds rather than conditional for the corporate existence and compliance.
In the 1950s the primary focus was on businesses' responsibilities to society and doing good
deeds for society. In the 1960s key events, people and ideas were instrumental in characterizing
the social changes ushered in during this decade.
In the 1970s business managers applied the traditional management functions when dealing with
CSR issues. Hetherington (1973) stated that, there is no reason to think that shareholders are
willing to tolerate an amount of corporate nonprofit activity which reduces either dividends or
the market performance of the stock. Dahl (1972) argued that every large corporations should be
thought of as a social enterprise; that is an entity whose existence and decisions can be justified
in so far as they serve public or social purposes, the desirability of considering the social
performance of the a business has not always however been accepted and has been the subject of
the extensive debate, Crowther & Aras G ( 2008). Also Philips and Lyall (1998), in the modern
commercial area companies and their managers are subjected to well publicized pressure to play
an increasingly role in the welfare of the society.
While, in the 1980s, business and social interest came closer and firms became more responsive
to their stakeholders. During the 1990s the idea of CSR became almost universally approved,
also CSR was coupled with strategy literature and finally, in the 2000s, CSR became definitively
an important strategic issue.
Tony Blair, former UK Prime Minister, May 2000 reckoned that;" We are more than ever aware
of the potentially negative impact of the business on the environment , whatever the nature or
size of the business there can only be positive results from developing sustainability from
3
benefiting your own bottom line to benefiting tomorrow industry to benefiting the environment
in which we all live.
Corporate social responsibility (CSR) is a concept that has acquired a new character in the
global economy. “With the advent of globalization, managers in different contexts have been
exposed to the notion of CSR and are being pressured to adopt CSR initiatives” (Jamali and
Sidani, 2008; 330).
Friedman (1970) stated that, there is one and only one social responsibility of business, to use its
resources and engage in activities designed to increase its profits so long as it stays within the
rules of the game, which is to say, engages in open and free competition without deception or
fraud. Drucker (1984) revealed that, business turns a social problem into economic opportunity
and economic benefit into productive capacity, into human competence into well paid jobs and
into wealth. Doane & MacGillivra (2001), in fact economic sustainability is the paradoxical
golden child of sustainability: if organizations or countries understood perfectly well what it
meant to be economically sustainable, there would be full employment, less poverty and no
bankruptcies. Unfortunately, that is not the case: economic sustainability is a complex picture,
the nature of which cannot be fully understood without looking at both the internal and external
environment in which organizations are operating. Existence of sustainable business is the most
prior concern of every business practitioners, doing good by doing well is the utmost faith of
corporate social responsibility. Ensuring that, the company gets enough profit at the same time
share the profit with the society. While it was widely held in previous decades that companies
should only focus on their bottom lines, the past decade has seen a change in this thinking.
4
Doane & MacGillivra (2001),most companies are concerned not only with their immediate
financial performance, but with their ability to continue long into the future being a player able
to make positive contributions to their local community, broader society and planet as a whole
Nielsen survey (2015) revealed that, 66 percent of online consumers said they would pay more
for products or services from companies that are socially and environmentally responsible, the
same survey also found that consumer-goods‟ brands with a commitment to sustainability
outperform those that don‟t. It's by protecting the environment the business is operating in,
supporting construction of infrastructure system, providing social service, sponsoring sports and
games, providing scholarship and providing financial support to orphanage centre. "Maintaining
high and stable levels of economic growth is one of the key objectives of sustainable
development. Abandoning economic growth is not an option. But sustainable development is
more than just economic growth. The quality of growth matters as well as the quantity." UK
Government Annual Report 2000, January 2001. Corporate social responsibility (CSR) initiates
social benefits. However, in the modern world of business today, CSR is a contested topic and its
is by no means certain that everybody thinks it is important or relevant to modern business,
Crowther and Aras (2008). An understanding of what makes companies survive will help
sustainability managers embed their programmes more effectively. If they are not concerned
with whether or not their company can stay in business, all the good green and community work
could disappear at the whim of the market Doane & MacGillivra (2001). A certain amount of
rhetoric may be inevitable in the area of social responsibility. Managers may even believe that
making statement about social responsibility insulates the firm from the necessity of taking
socially responsible action.
5
Also Moir (2001) whether or not business should undertake CSR and the forms that
responsibility should take, depends upon the economic perspective of the firm that is adopted.
Practicing corporate social responsibility shouldn't have been an optional or voluntary deeds
rather than conditional for the corporate existence and compliance, Aras & Crowther ( 2008).
These initiatives fall into three categories, often called the triple bottom line, which are social,
environment, and economic. At first, many businesses didn‟t take corporate social responsibility
seriously, however, as consumers have become more aware and educated on social issues like
global warming and unethical labor practices, they have begun demanding businesses institute
policies that benefit all of society rather than just the business‟ bottom line. Companies that don‟t
practice effective corporate social responsibility simply do experience situation like, customer
taking their money to a company that practice effective corporate social responsibility. Recently
it has found to be crucial to integrate corporate social responsibility as codes of ethics or codes of
conducts of company sustainability strategies, companies who initially practice corporate social
responsibility eventually enjoys good business reputation and at the same time enjoy customer
loyalty.
Hetherington (1973) stated that, there is no reason to think that shareholders are willing to
tolerate an amount of corporate nonprofit activity which reduces either dividends or the market
performance of the stock. Despite, the reasonable importance of corporate social responsibility,
companies do claim that, the cost of practicing corporate social responsibility is a non-
recoverable in the long run and they should be shared by both stakeholders of business from
global to national level. Governments at national level do claim that, companies should take
enough initiatives to incorporate corporate social responsibility at the best level of it, in order to
offset the consideration of practicing it with the return expected in the long run.
6
Corporate Social Responsibility (CSR) is a recent entry in the economy of modern enterprise
both at global level and international level. Corporate social responsibility contribute to the
sustainable development of economic entities. Corporations around the world are struggling on
how to meet the needs of the present generation without compromising the ability of the next
generations to meet their own needs. Organizations are being called upon to take responsibility
for the ways their operations impact societies and the natural environment. They are also being
asked to apply sustainability principles to the ways in which they conduct their business.
Sustainability refers to an organization‟s activities, typically considered voluntary, that
demonstrate the inclusion of social and environmental concerns in business operations and in
interactions with stakeholders (van Marrewijk & Verre, 2003). It is no longer acceptable for a
corporation to experience economic prosperity in isolation from those agents impacted by its
actions. A firm must now focus its attention on both increasing its bottom line and being a good
corporate citizen. Keeping abreast of global trends and remaining committed to financial
obligations to deliver both private and public benefits have forced organizations to reshape their
frameworks, rules, and business models. To understand and enhance current efforts, the most
socially responsible organizations continue to revise their short- and long-term agendas, to stay
ahead of rapidly changing challenges. Gray & Bebbington (2001) Social and environmental
issues are brought together - and made even more demanding - within the concept of
sustainability. Sustainability is a difficult concept to apply to any single corporation. It is
primarily a global concept. But that doesn't mean it has no application to corporation, It should
come as no surprise that the recent developments in social, environmental and sustainability have
not placed formal accountability at their heart. The accountability that the stakeholders
themselves wish to see. Ernst &Young (2010), companies are facing growing pressure to explain
7
and improve their sustainability performance. Key financial stakeholders, like investors and
equity analysts, are building sustainability factors into their analysis and investment decisions.
Stakeholders like consumers and non-government organizations (NGOs) are demanding more
data regarding companies‟ environmental and social performance. Regulators and standards
setters are piling on the pressure, too. Sustainability has made its way to the boardroom.” Now,
sustainability may be on the cusp of more active audit committee involvement, particularly given
the need to embed it firmly into risk and compliance processes and to improve sustainability
reporting.
However, an enormous shift has occurred in how organizations must understand themselves in
relation to a wide variety of both local and global stakeholders. The quality of relationships that a
company has with its employees and other key stakeholders such as customers, investors,
suppliers, public and governmental officials, activists, and communities is crucial to its success,
as is its ability to respond to competitive conditions and corporate social responsibility (CSR).
These major transformations require national and global companies to approach their business in
terms of sustainable development, and both individual and organizational leadership plays a
major role in this change. Organizations have developed a variety of strategies for dealing with
this intersection of societal needs, the natural environment, and corresponding business
imperatives. Organizations can also be considered on how they develop and integrate social
responsibility approaches into both strategy and daily operations world- wide. At one end of the
development continuum are organizations that do not acknowledge any responsibility to society
and the environment. And on the other end of the development continuum are those
organizations that view their operations as having a significant impact as well as reliance on
society at the economic, social, and ecological levels, thus resulting in a sense of responsibility
8
beyond the traditional boundaries of the organization. Most organizations can be placed
somewhere in between. Corporate responsibility or sustainability is therefore a prominent feature
of the business and society literature, addressing topics of business ethics, corporate social
performance, global corporate citizenship, and stakeholder management. Management education
can be an important source of new ideas about shifting toward an integrated rather than fractured
knowledge economy, but this means also that the role and meaning of socially responsible
leadership needs to be updated.
Much further research is needed, since some current developments on this topic draw attention to
similarities and differences in the three angles of the triple bottom line (TBL) the environmental,
societal, and business arenas. Elkington (1997) ,the triple bottom line is a form of corporate
social responsibility dictating that corporate leaders tabulate bottom-line results not only in
economic terms (costs versus revenue) but also in terms of company effects in the social realm,
and with respect to the environment. There are two keys to this idea. First, the three columns of
responsibility must be kept separate, with results reported independently for each. Second, in all
three of these areas, the company should obtain sustainable results. The notion of sustainability is
very specific. At the intersection of ethics and economics, sustainability means the long-term
maintenance of balance. As elaborated by theorists including John Elkington, here‟s how the
balance is defined and achieved economically, socially, and environmentally.
9
Figure 1.1: Triple Bottom line and Company Sustainability
Source; Researcher.(2018)
The field addresses complex and critical issues, such as human rights, environmental protection,
equal opportunities for all, fair competition, and the interdependencies that occur between
organizations and society (Quinn, 2008). Ongoing research reveals that a variety of strategies,
alliances and partnerships, and approaches are being used around the globe. The literature also
reveals that although the aspiration of many corporations to contribute to a better world is great,
translating that aspiration into reality proves to be somewhat of a challenge. Corporate social
responsibility (CSR) is now viewed as “one of, if not the most important issue of our time”
Hopkins (2007). Its concept is dynamic, multifaceted and global; but it has proved to be a
contentious matter across the world. It is a plethora of concepts that have emerged to express the
role and responsibilities of business in society Judy (2012), which has developed a vast body of
literature that supports and critiques its principle of the triple bottom line that has left a lot of un-
attempted questions from practitioners and academia in most developing countries and, in
particular, Tanzania. These questions, among others include what role do politicians, government
10
regulation, legislation, and voluntary standards play in the adoption of CSR strategies? Which
CSR theory is currently adopted? What are the benefits of CSR practices taking into
consideration its cost to implement?, what are the challenges and opportunities faced by both
public sector and private companies seeking to engage in CSR programmes in global context?, is
there a strong relationship between CSR and company's economic sustainability?.
1.1.2 Global trend
Georg kell (2014), regardless of whether you call it CSR, corporate responsibility,
environmental, social and corporate governance (ESG) or sustainability, a common
understanding is emerging around the world: a company's long-term financial success goes hand
in hand with its record on social responsibility, environmental stewardship and corporate ethics.
Corporate social responsibility is the global concept that, most companies have now and then
tried to integrate in their business. The discussion on whether it is worth to enhance CSR in
business, has been a ground of discussion from back in days up to now. Corporate Social
Responsibility (CSR) is a recent entry in the economy of modern enterprise both at global level
and international level. Corporate social responsibility contributes to the sustainable
development of economic entities. Corporations around the world are struggling on how to meet
the needs of the present generation without compromising the ability of the next generations to
meet their own needs. Organizations are being called upon to take responsibility for the ways
their operations impact societies and the natural environment. They are also being asked to apply
sustainability principles to the ways in which they conduct their business. Georg Kell(2014),the
costs to business and society of getting it wrong and the benefits of getting it right are
increasingly apparent. However, the question remains whether this is a passing trend or one that
11
will continue to reshape the profile of business. Several big trends indicate that corporate
sustainability is here to stay.
1.1.3 Sub- Saharan Africa trend
R,Kilonzo & T, Kontinen (2015) ascertained that, the Sub- Saharan Africa (SSA) has not been
left out in corporate social responsibility growing debates. Sub- Saharan Africa still stand as a
potential investment zone, where a number of industries have been established in recent years.
This region has been blessed with resources which the host countries have not been efficient in
their exploitation at the same time the society surrounding the industries have been experiencing
a number of side effects, either positive or negative. Slight advantage has been observed in term
of social service and infrastructure system, construction of roads and railways and provision of
social service such as school ,hospital ,market water and electricity supply plus provision of
scholarship and sponsorship are the most observable positive advantages. Today, corporate
social responsibility (CSR) “debates are not just occurring in developed economies…Countries
around the world are engaging in rich and nuanced debates and undertaking significant reforms
in the corporate governance and CSR arenas” (Afsharipour, 2011, p. 996). Mickels (2009) adds
that “directors all over the world are questioning whether corporations should exist solely to
maximize shareholder profit” (p. 271). The Society of Human Resource Management (SHRM)
(Workplace Visions, 2007) found that a majority of Human Resource professionals (United
States, Australia, India, China, Canada, Mexico, and Brazil) reported that their organizations had
corporate social responsibility practices in place. SHRM put forth a number of reasons for the
extent of corporate social responsibility (Cavico and Mujtaba, 2012a/b).
12
Blowfield, M., & Frynas, J. G. (2005), set the tone for a new direction in CSR research to
determine what CSR does and could mean for the poor and marginalized in developing
countries. They assert that claims about CSR contributions to alleviate poverty and achieve other
developmental goals.
D,popp (2012).However, the society is complaining of suffering due to the existence of these
industries, a number of problems are said to be influenced by their operations. Eruption of
diseases caused by contamination of water has caused a number of death and suffering to human
being and livestock as many cases has been reported recently. These industries are entirely
claimed to prioritize maximization of profit and have a slightly concern of the surroundings.
R,Kilonzo & T, Kontinen (2015). The society and human rights agencies have now and then
vowed to have a campaign on discussing on how to rectify these challenges, henceforth they
have established campaigns on protecting both the environment and the society, this has come
with positive answers, increased awareness of CSR, formulation of polices and laws guiding
CSR as the recommended code of conducts for company compliance to laws and regulations of
the state. Companies that involves in effective corporate social responsibility are likely to attract
more customers in a long run compared companies do not, this is contention that customer value
higher, the companies that values higher society values, society wellbeing and environment at a
large. The sustainability of company depends on the existence of customer they serve, thus the
increase in number of market share suggest the existence of the company in the long run and vice
versa.
13
The establishment and implementation of CSR as code of ethics and code of conducts cannot be
left out in the contention of policy making and regulating in the world of economy today, most of
which are Sub- Saharan countries.
1.1.4 Tanzania trend
Tanzania like other developing countries in the world which champion the establishment and
effective implementation of CSR as a code of ethics and code of conducts for company
compliance. The National investment policy (1996) and its subsequent changes have been useful
in creating a favorable investment environment in the country.
D,popp (2012). The CSR dialogue and agenda has gained momentum with an increase in multi-
national companies investing in the country, and is therefore driven by the business sector in
Tanzania. As this concept is a rapidly evolving and expanding field in Tanzania, opportunities
arising from working with the private sector are diverse and increasing. There is tremendous
breadth and diversity in the types of corporate social responsibility activities, as well as the
partnerships that are oftentimes needed to effectively implement them. The successes and lessons
learned from the existing CSR initiatives and supporting programs in Tanzania could be used to
a greater advantage in building blocks for expanding support towards attaining sustainable
partnerships. However, it is important to note that as partnerships are strategic for business,
relationships between the public and private sectors in many countries in Africa, including
Tanzania, are marked by suspicion and mistrust.
R,Kilonzo & T, Kontinen (2015). Argued that, the lack of positive business environment is
attributed by the private sector to weak state regulatory frameworks and procedures, while public
agencies and civil society organizations are often concerned about the failure of business to
14
promote Corporate Social Responsibility (CSR), adopt pro-poor business models and more
deeply support development goals. In light of this, more efforts need to be invested in designing
strategic and integrated perspectives that will help eliminating negative perceptions towards each
partner. International support and expertise will be helpful to facilitate this transition as it is
important to empower the people of Tanzania to build a sustainable nation.
Flavianus B. Ng‟eni et al (2015). Whether the company`s Corporate Social Responsibility (CSR)
programs influence positively the community`s development and enhance peoples‟ wellbeing is
irrefutable reality. S, Mbirigenda (2015), The only remaining truth to unveil is to what extent and
how with emphasis to specific country experience such as Tanzania for which this section is
dedicated. In this stance the section presents the results regarding CSR and community
development.
Moreover, Dr Karin Mader (2012), conducted an Overview of Corporate social responsibility in
Tanzania. He argued that, traditionally, in Tanzania, Corporate Social Responsibility (CSR) is
widely under- stood as philanthropy (“doing good with part of the profit”) and thus refers to
charitable community support projects in most cases. While In the contemporary global business
environment, CSR generally refers to sustain- able business performance, i.e. the principle to
generate profit itself in a socially and environmentally responsible way. He concluded that,
Awareness and interest related to CSR are growing in Tanzania. On the basis of the context and
stakeholder. Over the last years in Tanzania, mostly foreign firms in the banking,
telecommunications and mining sectors have been active in CSR. Particularly their charitable
activities are covered by the media on a regular basis.
15
However, still some challenges are observed to be fatal to the development of corporate social
responsibility in Tanzania; lack of enough knowledge on CSR, lack of curriculum involving
corporate social responsibility in Tanzania and lack of effective policy on corporate social
responsibility. Tanzanian scene based on the existing literature and through analysis of results
from selected companies.
1.2 Significance of the study
This study shows the impact of CSR on company's economic sustainability. The study therefore
enhanced awareness to practitioners, researchers academicians, politician‟s, investors and the
nation at large on the best use of CSR as the strategy that should be adopted by companies for
the benefit of both companies and community at large. In addition the study points out the way
CSR can be used to enhance company's economic sustainability while benefiting the society
welfare. Finally the study serves as a basis for further researches in Corporate Social
Responsibility to other scholars by suggesting research as well as serving as a point of reference
on Corporate Social Responsibility in the country. This in turn will help to improve the country‟s
competitiveness in attracting CSR practices, as well as encouraging both foreign and local
entrepreneurs to comply with CSR standards.
1.3 Statement of the Problem
The increasing debate on how companies should operate and thrive under industrial competition,
has taken into consideration the need of maximizing both shareholders profit and stakeholders
worth, while at same time, complying with government rules and regulations where the need to
take full initiatives in incorporating corporate social responsibility is now and ever legally
recommended. It's no longer an option but it‟s enforceable by law from global level to
16
international level. Company's economic sustainability largely depends on business reputation
and customer retention which are highly influenced by effective corporate social responsibility.
The idea of corporate social responsibility is foremost crucial and largely influences Company's
economic sustainability with the help of good CSR reporting. Thus, it's said that, there is a close
relationship between corporate social responsibility and business sustainability.
However, corporate social responsibility is experiencing a complex transfusion and shift in terms
of awareness, transparency, implementation and evaluation. Epstein (2009), states that,
companies knows that it is critical to formulate a sustainability strategy, but how to formulate
and execute it remains a challenge. There is a lot of argument on who should take full
consideration of practicing CSR, is it the responsibility of company, government or stakeholders
of the company or the responsibility of both?. How does companies effectively practice CSR in
terms of transparency, implementation and evaluation?. Corporations are increasing conscience
about the importance of matching their own interests and the interests of society by taking
responsibility for the impact of their activities on employees, suppliers, customers, communities
and other stakeholders as well as the environment. Epstein (2009), competitive pressures that
question whether global standards are too costly or unsafe for the operations in many countries.
Deciding whether to follow a global standard or to follow common country practices or locally
adapted standards is just one of the many challenges that multinational corporations encounter
when trying to set a sustainability strategy. All of these unrealistic expectations arise from the
failure of company to know the strength of the relationship between CSR and company's
economic sustainability. This study aimed at exploring in details the impact of CSR on
company's economic sustainability being practiced in Tanzania. The study sought to establish the
relationship between corporate social responsibility and company's economic sustainability,
17
exploring in details at what extent does CSR contribute to the company's economic
sustainability. A number of factors influencing and promoting CSR practices, including CSR
opportunities in Tanzania, were both explored in details.
1.4 Objective of the Study
The objectives of this study have been split into general to specific objectives. Specific
objectives flow from the general objective which is the main focus of the study. On the other
hand, the specific objectives are breakdowns of the general objective so as to ensure that the
study tools are designed to achieve the general objective.
1.4.1 General Research Objective
The main objective of the study was to show the impact of corporate social responsibility on
company's economic sustainability in Tanzania, NBCL-Mwanza being a case study.
1.4.2 Specific Objectives.
i. To examine transparency on company's economic sustainability at NBCL in Tanzania.
ii. To assess accountability on company's economic sustainability at NBCL in Tanzania.
iii. To find out the relationship between company's compliance and company's economic
sustainability at NBCL in Tanzania.
iv. To examine resource management on company's economic sustainability at NBCL in
Tanzania.
v. To assess the economic sustainability of NBCL in Tanzania.
18
1.5 Research Questions
i. Does transparency impact company's economic sustainability in Tanzania?.
ii. Does accountability impact company's economic sustainability in Tanzania?.
iii. Is there a relationship between company's compliance and company's economic
sustainability in Tanzania?.
iv. Resource management has anything to do with company's economic
sustainability?
v. What is the economic sustainability of NBCL in Tanzania?.
1.6 Variable of the study
Corporate social responsibility is the independent variable while company's economic
sustainability is the dependent variable. The study therefore intended to show the way dependent
variable above is influenced by independent variable which is Corporate Social Responsibility.
This implied a cause to effect relationship that was measured by mixed method approach.
1.7 Scope of the study
The study was expected to establish the extent to which corporate social responsibility has
influenced company's economic sustainability. The study analyzed the extent to which corporate
social responsibility has brought about company's economic sustainability, the exact relationship
between corporate social responsibility and company's economic sustainability. Since the impact
is usually measured from the beneficiaries perspectives as it is difficult to ascertain that the
sustainability of NBCL is due to CSR and not due to other factors, this stand to be a limitation
19
of this study. Therefore future research is proposed to be done, that will track impacts to
beneficiaries CSR.
1.8 Definitions of key Terms
Definitions of key terms are categorized into two parties namely, theoretical definition and
operational definition.
Corporate social responsibility (CSR)
CSR is an excellent tool to market the firm and should therefore be led by marketers (Lantos,
2001) or be used to enhance the company's brand. (Lewis, 2003).It is a corporation's initiatives
to assess and take responsibility for the company's effects on environmental and social
wellbeing. Corporate social responsibility (CSR) is a business approach that contributes to
sustainable development by delivering economic, social and environmental benefits for all
stakeholders. Whatever the definition is, the purpose of CSR is to drive change towards
sustainability, Economic sustainability being an embolic of the company existence. Financial
Times (2015).As a specific theory of the way corporations interact with the surrounding
community and larger world, corporate social responsibility (CSR) is composed of four
obligations as illustrated in fig 2 below,
20
Figure 1.2: Types of Corporate Responsibilities
Company’s sustainability
Thwink org(,2014),is an approach that creates long-term stakeholder value by implementing a
business strategy that considers every dimension of how a business operates in the ethical, social,
environmental, cultural, and economic spheres as long as it stay within the rules of the games of
business in unforeseeable future. As illustrated in fig 3 below,
Figure 1.3: Company Sustainability and Corporate Social Responsibility
Source; Thwink org (,2014).
21
Economic sustainability
Thwink org(,2014),is the ability of an economy to support a defined level of economic
production indefinitely. Corporate Social Responsibility (CSR) is a recent entry in
the economy of modern enterprise both at global level and for international level. CSR adds a
new dimension to the enterprise's performance in the social fields, contributing to
the sustainable development of economic entities Danubianu ( 2017). Is the degree to which a
company actively and constructively uses its resources to support the social and economic
development of communities, through direct investments of cash, in-kind support or staff time,
or through company policies that generate community capital, such as local sourcing, hiring,
partnerships and education Buried Treasure, Sustain Ability,(2001). Thus company's economic
sustainability is of more concern when dealing with corporate social responsibility, since
economic sustainability is integrally linked to the environmental and social outcomes an
organization achieves, Doane & MacGillivra (2001).
1.9 Conceptual framework
This part presents the pattern of relationship measured so as to have a thorough comprehension
of the study. A conceptual framework is a collection of concepts or models which inform a
research study. It relates a study to the existing ideas or principle. The conceptual framework
(refer Fig.4) developed by the researcher shows that the impact of CSR on company's economic
sustainability will be determined by the interaction of three different variables. Company's
economic sustainability (dependent variable) on the level of attained resource management
(intervening variables) to influence positively or negatively the corporate social responsibility
(independent variable) and its implementation.
22
Independent variable is the corporate social responsibility training. The assessment of the
independent variables is directed to show how it impact company's economic sustainability.
Intervening Variables they are the variables that provide a causal link between other variables
(independent and dependent variables). Intervening variables are expected to influence the
independent variable positively or negatively on the process of attaining objectives of the study.
The intervening variable of this study is the effectiveness of resource management of the
company. This intervening variable is expected to determine the outcome of the study. This
means that if influential factors have positively interacted with the independent variable, there
will be achieved pre-determined objectives of the study, if variables have negatively interacted,
the opposite is true.
Dependent variables are the outcomes of the interaction between the independent variable(s)
and the intervening variables. If independent variables will positively be linked with intervening
variables, the desirable economic sustainability of the company is expected. On other hand, if the
same factor is negatively interacted or mistreated result into undesirable economic sustainability,
which will also be reflected by its impacts in its operation. The arrows have been used to show
the direction of influence.
23
Figure 1.4: Conceptual framework
Independent Variable Dependent Variable
Corporate social responsibility Company's Economic sustainability
Transparency
Accountability
Compliance
Intervening Variable
Resource Management
Source: Researcher, (2018).
Increasing Profit
24
CHAPTER TWO
LITERATURE REVIEW
2.0 Introduction
This chapter presents the discussion on corporate social responsibility and company's economic
sustainability. It point out the theories of corporate social responsibility, by presenting the
discussion among Authors of corporate social responsibility from global to the Tanzanian
context. It then continues showing the theoretical framework of corporate social responsibility
(CSR) by discussing the theories. In addition, the chapter presents studies conducted at global
level, Europe, Asia, Africa specifically the Sub Saharan region in which Tanzania belongs as
well as specific Tanzanian studies. This chapter comes to an end by presenting the knowledge
gap and the way it will be covered.
2.1 Theories of Corporate social responsibility on Company's economic sustainability
The theories of Corporate social responsibility have be discussed and grouped differently by
different authors, The study will confine itself to theories of CSR on both global and
international levels as well as the development of theories and the implementation of CSR at
country level specifically Tanzania. The study intended to take consideration of three basic
theories namely; stakeholder‟s theory, social contract theory and legitimacy theory, of which the
clue of the discussion of the study relied on stakeholder‟s theory.
2.1.1 Stakeholder Theory
This theory analyses those groups to whom the company should be responsible for, the
stakeholders (Moir, 2001). The stakeholder theory is a theory of organizational management and
25
business ethics that addresses morals and values in managing an organization. Stakeholder
theory, which has been described by Edward Freeman and others, is the mirror image of
corporate social responsibility. Instead of starting with a business and looking out into the world
to see what ethical obligations are there, stakeholder theory starts in the world.
Freeman's (1984; 46 cited by Moir, 2001; 19) definition of a stakeholder is “any group or
individual who can affect or is affected by the achievement of the organization's objectives.
Strength and Weakness of stakeholder’s theory
Stakeholder theory describes the actual way business works, it maps the way business actually
works today. It might be opinion research showing that most management believes a sole focus
on shareholder interests is unethical. Or it might be studies showing that a growing number of
court cases and governmental regulations now give managers greater leeway in taking factors
aside shareholder interests into account in their management decisions.
Stakeholder‟s theory is essentially framed as a means to increase efficiency, better business
performance and ultimately higher profits. It show the means of how business can have high
profits and sustainable economically.
Stakeholder‟s theory is seen to be moral or ethical issue. This frame usually rests on the idea
that each stakeholder group has intrinsic value, and that no group‟s interests are more or less
important than any other. Thus, stakeholder theory is of important because it is fair.
Despite its seeming rise in popularity, many smart scholars have problems with a stakeholder
theory of the corporation. Some (e.g. Key 1999) argue that stakeholder theory lacks specificity
and, thus, cannot be operationalized in a way that allows scientific inspection. Others, like a
26
commenter to" his first post at Conglomerate", feel that stakeholder theory offers no decision-
making criteria that would adequately guide corporate governance. Most critics, like Teppo, feel
that stakeholder theory is vacuous and offers an unrealistic view of how organizations operate.
It‟s true that some stakeholder theories do each of these things, but the real problem is that there
are so many versions of stakeholder theory that it‟s difficult to offer critique. The following
perspectives offers the in depth critique regarding stakeholders theory;
The organization is a shell that can be written upon freely by the various groups that lay claim to
the corporation. The firm has very few innate interests. Its interests, in fact, are almost entirely
determined by its relations to primary and secondary stakeholders. Change those relations, and
the interests of the firm change accordingly. Interests aren‟t innate at all; rather, they are merely
reflective of the meaningful ties that one has.
The firm has its own economic interests, and so do the stakeholders. The firm‟s primary purpose
is to be a profit-making machine. The stakeholders‟ interests are to redistribute the wealth
created by the firm to other constituencies, possibly to themselves. The struggle, then, involves a
set of negotiations between the parties, as they try to define who deserves more or less of the
firm‟s resources, Coff (1999). David Baron argues that stakeholders use the threat of state
intervention to convince firms that it is in their best interest to redistribute resources voluntarily.
These two arguments represent extremes, of course. In between are those touting a resource
dependence perspective (like Frooman or Clarkson). They postulate that stakeholders‟ influence
over firm decision-making is a function of the firm‟s dependence on them for critical resources.
In this intermediate view, the firm may be constituted by stakeholder interests, but only in as
much as they help it achieve its own predetermined ends.
27
However neither of the two arguments represents a realistic view of what goes on in the firm.
The first perspective seems to ignore the institutional requirements of the modern corporation.
The corporation as a legal fiction created to maximize market value is absent. Managerial
incentive is nowhere to be seen. And discretion, forget about it! In short, this argument tends to
reduce the firm to a social construction that can easily change its interests to meet the demands
of crying stakeholders.
The second view, however, moves too much in the other direction. Firms are always seen as
value maximizing and they have sufficient information to weigh the costs and benefits of
negotiating with secondary stakeholders. In this view, there is no room for a firm that might
actually prefer to forego some profit for the benefit of a collective good. The corporation's (and
the stakeholders) are one-dimensional actors. Another problem results when these scholars try to
build altruism into their model. It‟s never apparent why a firm should act altruistically in the first
place.
What‟s to be done with stakeholder theory? What is needed is a way to think about the firm as a
social actor that allows for heterogeneity of interests without simply seeing the firm as a blank-
slate willing to be written upon, a mediating mechanism is needed as an alternative
organizational identity perspective. In this perspective, each organization has its own unique
identity that distinguishes it from its competitors while at the same time establishing it in a
particular legitimacy-lending social category. The identity fills the organization‟s needs for
inclusion and distinctiveness. Identity also conditions the firm‟s interaction with potential
stakeholders. It is the DNA that produces the firm‟s disposition and interests. When the firm‟s
identity matches up with that of a particular stakeholder group (as Timberland‟s identity matched
28
with the environmental movement), the firm tries to perform in a way that benefits both its
survival and the stakeholder‟s interests.
There are two key underlying assumptions about this alternative view make it work. The first is
recognizing that there is heterogeneity in corporate interests and that the interests are not
necessarily mutually exclusive. The shareholder value maximization interest is not always
incompatible with the goal to promote environment-friendly policies.
The second key assumption is that the identity is established in the formative years of the
company and tends to be stable over time. The second assumption is based in the ideas of
structural inertia. Thus, the founding effects of a firm on its identity largely determine how
willing it will be to engage in conversation with certain stakeholder groups in the future.
The discussion of this study was largely encompassed with this theory, because of the need to
integrate the thought of all stakeholders whose existence affect directly the implementation of
CSR practices as the strategy to brought company's economic sustainability.
2.1.2 Social Contracts Theory
Social contract theory is an ancient philosophical idea that states that an individual's ethical and
political obligations relate to an agreement he has with every other individual within a society.
The agreement can be written, as in the form of laws, or it can be a tacit agreement, an unspoken
or unwritten agreement of social norms and customs. In business, social contract theory includes
the obligations that businesses of all sizes owe to the communities in which they operate and to
the world as a whole. This involves corporate philanthropy, corporate social responsibility and
corporate governance.
29
Gray et al (1996 cited by Moir, 2001 ;) „Describes society as a series of social contracts between
members of society and society itself‟. This theory relates the activities of an organization as part
of the expectations of the society as a whole and not only its commercial interests (Moir, 2001;
Gyves and O‟Higgins, 2008).
Strength and Weakness Social of contract theory
More positive benefits of meeting social responsibility expectations from the public can include
stronger customer relationships and better long-term profit potential. Though the question is
posed on the direct business benefits of social responsibility, a main purpose is to build deeper
relationships with customers and the community. Over time, this deeper connection undoubtedly
produces more sales and better profits. This is especially true of small businesses. Some
customers in local markets make it a point to support local businesses that set the standard in
meeting social responsibility contracts.
Meeting social contract expectations costs money. Committing to fair treatment of employees
means that your company invests in training to build a culture of tolerance and acceptance. It
also means that you give back to the communities you earn profits from by giving to charitable
organizations and community programs. On the environmental responsibility front, it costs
money to manage recycling programs and to use environmental-friendly materials and business
processes.
Another common argument against social responsibility in business is that it distracts companies
from a core business pursuit of profits. The money spent focusing on social responsibility is the
time and money not spent on product development, marketing or other profit-generating
30
activities. Additionally, shareholders sometimes have concerns about companies they invest in
spending money to meet social expectations of the public.
Meeting informal social responsibility guidelines gives businesses significant protection against
possible legal and reputation risks that come with walking an ethical line in business. In the
information age, consumer and environmental watch groups do a good job calling attention to
businesses that either stand out as social responsibility leaders or fail to deliver on expectations.
Failures to participate in your communities, to treat customers and employees fairly, and to
preserve the environment can all attract negative attention from government regulatory bodies.
2.1.3 Legitimacy Theory
Belal (2008; 14) explains that, “Broadly, legitimacy theory indicates that organizations may try
to legitimize their activities by engaging in CSR reporting in order to get approval from society
in support of their consistent existence and „license to operate‟”.
Apart from the theories cited above, many others were created to explain Corporate Social
Responsibility, profitability and its impacts in the society; however, those are the most common
ones. Deegan and Unerman (2011) assert that the legitimacy theory relies upon the notion that
there is a “social contract” between an organization and the society in which it operates.
Therefore, corporation try to legitimize their corporate actions by engaging in CSR reporting to
get the approval from society (societal approach) and thus, ensuring their continuing existence.
The social contract as explained by Deegan (2002), represents myriad of expectations that
society has about how an organization should conduct its operations. O'Donovan (2002) argues
that the legitimacy theory stems from the idea that for corporations to continue operating
successfully, it must act within the bounds and norms of what society identifies as socially
31
responsible behavior. Maignan and Ralston (2002) provide that legitimacy of a firm is dependent
on the maintenance of reciprocal relationship with its stakeholders, given that the firm has
obligations including moral obligations to a broad range of stakeholders in to their shareholders
(Adams et al., 1998). Kytle et al. (2005), CSR reporting practices have become a key
management tool to the growing complexity to multinational business management. They further
argue that CSR reporting helps to integrate CSR activities into companies‟ strategic risk
management so that the impact of CSR activities can be maximized. Waddock et al. (2002) argue
that employee's perceptions about how a corporation accepts and manages its responsibilities are
often part of the employee's decision about where to work. Therefore, publication of
sustainability related information can play a role of positioning a firm as an „employer of
choice‟ and as such, this status can enhance loyalty, reduce staff turnover and increase a firm's
ability to attract and retain high quality employees. Margolis and Walsh (2003) claim that
corporation‟s engagement in CSR activities and its disclosure can foster corporate performance
and as such their research conclude a positive relationship between CSR performance and
financial performance (shareholder approach). Roberts (1992) asserts that one way that firms
consider CSR disclosure is to increase access to capital and shareholder value by satisfying
stakeholder‟s expectation. Investors are choosing to invest in organizations that are
demonstrating a high level of CSR. Branco & Rodrigues (2008) argue that CSR disclosures play
an important mechanism to enhance the effect of CSR on corporate reputation as well as
representing a signal of improved social and environmental conduct. Bayoud et al. (2012)
confirm that a high level of CSR disclosures is strongly associated with corporate reputation for
stakeholder group (stakeholder approach). Stakeholder theory Consistent with stakeholder
approach.
32
Strength and Weakness of legitimacy theory
Deegan & Unerman's (2006), argued that legitimacy theory does offer a powerful mechanism for
understanding voluntary social and environmental disclosures made by corporations, and that
this understanding would provide a vehicle for engaging in critical public debate. The problem
for legitimacy theory in contributing to our understanding of accounting disclosure specifically,
and as a theory in general, is that the term has on occasion been used fairly loosely. This is not a
problem of the theory itself, and the observation could be equally applied to a range of theories
in a range of disciplines.
2.2 Empirical literature Review
This part presents the related studies conducted worldwide coming down to America, Asia,
Europe, Africa, Sub Saharan Africa, East Africa and Tanzania. The studies analyzed have been
conducted from now and then. The emphasis in analyzing these studies has been placed on what
they sought to be establishing the results and the methodology applied so as to clearly show the
research gap to be filled by this study. In addition, the findings in these studies are expected to
serve as inputs in this study especially on conceptualizing CSR.
Studies in America
Tran (2015), conducted a study on Corporate social Responsibility and Profits: A tradeoff or
balance. He argued that, Corporate social responsibility has been on everyone‟s mind lately
corporate executives, consumers, investors and many are curious to understand in what manner a
for profit organization‟s pursuit of philanthropic initiatives impacts the traditional firm‟s singular
object: profits. Although CEOs proudly proclaim that engaging in CSR (corporate social
responsibility) is the “golden ticket” to future growth and consumers are eager to support
33
products and companies deemed ethically and socially conscious, is CSR actually profitable? In
addition, he continues arguing that there is little flexibility for a firm to engage in social impact
projects if these programs do not provide an adequate financial return for the company. After
having a thorough analysis, he found that determinants of the success of a CSR campaign are
varied but key factors at play, especially in consumer facing industries, include the relevance of
the social initiative to the company itself, the ownership structure of the firm, and the criteria by
which consumers screen products for potential purchase.
He concluded by saying that, only time will tell if corporate social responsibility will eventually
become a profitable undertaking for the majority of firms. Today, it appears that neither
corporate executives nor consumers completely understand this venture into CSR: executives are
still working to understand how CSR can and should be applied to appease all involved parties
and consumers need to make clear how they truly feel about CSR and signal their preferences
more consistently with their dollars. Through repeated interactions in the marketplace, both sides
will come to an agreement as to the most effective and efficient way to tackle the profits-altruism
debate. What is clear, though, is that corporate executives have a growing concern with
appearing more socially conscious and consumers have a growing demand for companies to
more closely align themselves with the public good. Whether or not these goals will ever meet in
the middle and result in profitable and socially invested firms and satisfied consumers has yet to
be discovered.
Studies in Asia
Prakash J. Singh, et al (2017) conducted a study on the Impact of Corporate Social
Responsibility Dimensions on Firm Value: Some Evidence from Hong Kong and China. There
34
has been a significant interest and debate on the impact that a firms investments in corporate
social responsibility (CSR) practices and initiatives have on its market value .The study found
that , a temporal, inverted U-shaped effect has been found between time and the impact of CSR
investments on firms value.
The results indicate that it takes some time for the CSR initiatives to make an impact on firms
value, an impact that dissipates in subsequent years. As has been suggested by some researchers,
firms should be patient and take a longer-term perspective when implementing their CSR
initiatives as opposed to a myopic short-term focus. Also, as the benefits of CSR initiatives are
likely to fade away over time, firms need to ensure that their CSR practices are reinforced and
further cultivated so that the benefits are sustained. The results of study reveal that of the six core
CSR dimensions considered, CSR practices and initiatives focusing on community engagement,
and to a slightly lesser extent, those focusing on workplace quality, are found to both directly and
positively impact firms value. Different industries implement varying suites of CSR practices,
due to varying legal regulations and expectations of stakeholders. Industry- specific studies
would, to this end, provide a more comprehensive understanding of the benefits of CSR practices
to firms spanning different industries.
Kumar (2015) conducted a study on Corporate social responsibility: Mission possible, he
ascertained the role of corporate social responsibility on social development and its significant
impacts. He therefore strive to list the best case scenario of CSR as per the new law and try to
find out what could be achieved by giving a right direction to CSR of these companies. As CSR
activities of the companies are guided by the Schedule VII of the Companies Act 2013 that
includes the noble causes of eradication of extreme hunger and poverty, promotion of education,
promoting gender equality and women empowerment, reducing child mortality, combating HIV,
35
ensuring environment sustainability, developing employability skills. He suggested that,
companies that engage more in CSR spending will have better the reputation of the company and
better will be the profits, and CSR activities of Indian companies can help improve our social
progress index as most of the parameters included in calculation are covered under the activities
to be covered under CSR in Schedule VII of the Companies Act, 2013. Same parameters will
have positive impact on Human Development Index of the country; as social sector spending has
greater impact in societal development than government spending.
Studies in Europe
Danubianu & Teodorescu (2017), conducted a study on the impacts of corporate social
responsibility on sustainable enterprise development. He intended to establish the relationship
between corporate social responsibility and sustainable enterprise development, by asserting the
real cause effects of corporate social responsibility on sustainable enterprise development.
He concluded that, adopting the dimension of CSR to the company business horizon is not an
activity that takes several months. It is a continuous process, and its dynamics is comparable to
that of environmental awareness of technical best practices. During the implementation of CSR
at company level, the first set of results to be completed by further developments in the coming
years includes; the Company has acquired the expertise in a new domain CSR and there are
many company‟s employees that has got the knowhow for future CSR actions, the company and
its stakeholders constitute a team which members have learnt to work together, understand each
other and share the same CSR values. Again, the set of stakeholders is in a continual adaptation,
depending of the company evolution and of the business environment realities. Putting CSR at
work should be a process very similar to many other similar processes already experienced by
36
the company (devise Action Plans, allocate resources, nominate responsible, monitor progress,
take corrective actions, etc.) and this constitutes a big advantage for company‟s managers. They
are not faced to completely new procedures and tools, devising a Project Advisory Board should
help and ease the CSR implementation. The formal set of documents issued during CSR
implementation is very similar to the set of formal documents and procedures issued for the
Quality and Environmental Management System, CSR actions should be carried out by a large
cooperation among all stakeholders and Every organization should endures the CSR values as
CSR should not be applied to business units.
Marzanna Katarzyna, etal (2016), conducted a study on the impacts of business models to
corporate social responsibilities involvements. The study explored the links between types of
business models used by companies and their involvement in CSR. The study provided a
measure of reassurance to those consumers who are keen to support ethical companies but are
uncertain about the sincerity of their CSR claims. According to a recent segmentation study of
Polish households, those who are sensitive to cause-related marketing and are willing to pay
more for products of firms that contribute to solving relevant social problems make up almost
30% of the adult population. It seems that CSR in most active companies (market players and
integrators) is not “skin deep” but tends to be implemented quite thoroughly and
comprehensively. Therefore, it is believable that many of the CSR claims used as promotional
devices are genuine projections of strategic orientation and organizational culture values in firms
with the two most “sustainability-friendly” business models.
Studies in Africa
Omran (2015) conducted a study on Theoretical Perspectives on Corporate Social Responsibility
Disclosure. Social and environmental disclosures has flourished over the past years with
37
reporting on corporate social responsibility (CSR) information now considered to be an
important component, complementing financial reporting to reduce information asymmetry. A
significant body of evidence across business research disciplines examines questions such as
which types of firms engage in CSR, and how CSR shapes firm decisions and outcomes ,(Huang
& Watson,2015).
Oginni& Omojow (2016), conducted a study on Sustainable Development and Corporate Social
Responsibility in Sub-Saharan Africa: Evidence from Industries in Cameroon. Human activities
have increasingly short-lived sustainable natural endowments, to the extent that, the multiplier
effects have ripples beyond the traditional benefits of economic production and consumption.
The study addressed practical concerns on how industries in Sub-Saharan Africa promote
sustainable development in their corporate social responsibility models, using industries in
Cameroon as a case study; it examined economic, social, and environmental components of
sustainable development and corporate social responsibility (CSR). It is found that there is no
concrete evidence that industries promote sustainable development via CSR in Cameroon.
However, there is a growing awareness on the environmental risks and social costs of
unsustainable business practices among industries in the country because many of them have
environment friendly installations to mitigate environmental risks. Therefore, state laws and
policies should promote a sustainable business model; there is a need to reform policies on
business activities to promote sustainable development from small and medium enterprises to
large enterprises.
38
Studies in Tanzania
John (2016), conducted a study on the impacts of Corporate social responsibility on image
building a case study of Nyanza Bottling Company Limited. The study intended to establish the
relationship between corporate social responsibility and company image identifying CSR
activities done by Nyanza bottling company toward the image building of an organization,
assessing the effectiveness of CSR activities on image building of an organization and finally
find out the challenges an organization is facing in conducting CSR activities. He concluded by
saying that, community or customers are significant part of the organization development due to
the reason that the organization depend much on customers‟ acceptance on what the
organization produce. Due to this the organization should pay attention to the society by
conducting Corporate Social Responsibility in order to build the image of the organization which
in a long run enhances company sustainability.
Isanzu & Xu- Fengju (2016), conducted a study on Impact of Corporate Social Responsibility on
Firm‟s Financial Performance: The Tanzanian Perspective. Its revealed that, In Tanzania social
responsibility came about with increasing competition as many companies flooded the country
from various countries it gained momentum because now consumers have many options to
choose from (Mushi, 2007). Now days CSR is used as a marketing tool for creating competitive
advantage, ever since the number of firms doing CSR in the country has been on the rise.
Recently a CSR award has been introduced which seeks to reward firms that make a greater
contribution in the community through their CSR practices and also encourage other firms that
are yet to incorporate CSR in their strategies to do so.
39
Recently Tigo has partnered with a Swedish NGO on a pro child reach for change initiative that
is aimed at improving the welfare of children (Daily News, 2012). This is a very interesting
move because some of the challenges seen on CSR implementation were proper identification of
the community needs and pooling of resources which will be correctly addressed by entering into
joint partnerships like this. Mushi further stated that the Tanzanian community is characterized
by problems of unemployment, diseases, poor infrastructure and the businesses depend on these
people to support their operations by buying their products and services. This means the
prosperity of the firm solely depends on the community, then what ever can be done to alleviate
the community problems will be rewarded by the loyalty and reciprocity of the community. The
aim of the study was to test if there is a significant difference in financial performance of
companies that engage in CSR relative to those that do not.
The results showed that there is a significant difference in performance supporting the existing
body of knowledge for the positive impact of CSR on financial performance. Corporate social
responsibility increases the firm‟s brand awareness, leads to tax relief because of the
deductibility of CSR expenditures before taxes are charged. Corporate social responsibility
builds a good relationship with the stakeholders through full optimization of the supply chain
that leads to efficient use of resources and increased operational efficiency.
Corporate Social Responsibility improves customer loyalty, leads to reduced risks that normally
stem from expensive lawsuits and compensations and also lowers the firms cost of capital.
Corporations have become more powerful since the largest global economies are dominated by
them; therefore it‟s only sensible for them to have an increased role in addressing social
problems. If you look at the issues of environmental degradation, employees‟ welfare and
poverty state of the communities around them, they are best positioned to address and alleviate
40
these challenges faced by the communities. Policy implications also arise from practicing CSR; it
is recommended that companies should be ranked in terms of Social Responsible performance
and publishes even a list of those not qualifying as socially responsible to make consumers aware
of the firms they deal with. The practice will revolutionize and the efforts will transform the
community that is guaranteed. Underdeveloped countries have been offering less stringent
regulations, investment incentives, subsidies to increase FDI and growth of MNCs but this has
added adverse effects on the states‟ ability to enforce laws and regulations which protect
employees, environment and communities as a result developing countries have failed to
encourage responsible business practices. Furthermore the government lacks the financial, legal
and administrative resources to enforce strong regulations and their actions are further diluted by
the lobbying and sponsorship of prominent politicians and trade associations by the corporations.
2.3 Knowledge Gap
Scholars and researcher have done a lot on studying corporate social responsibility as a corporate
strategy in enhancing company's economic sustainability, of which the emphasis has been
employed to make a clear understanding on how does corporate social responsibility enhances
company‟s economic sustainability. Thus one reason to why corporate understanding of CSR is
crucial and more significant contributors to company's economic sustainability. Despite the
efforts of the practitioners in implementing CSR as the company strategy towards company's
economic sustainability, an enormous shift has occurred in how organizations must understand
themselves in relation to a wide variety of both local and global stakeholders. Major
transformations require national and global companies to approach their business in terms of
sustainable development, and both individual and organizational leadership should play a major
role in this change; managers are reluctant to use CSR as a sustainable strategy because they
41
believe that the budget of financing these activities are nowhere to be recovered. Also CSR is a
new strategy that managers are struggling on how to integrate in their operation, at the same time
the pressure is growing very tremendously to companies to engage in CSR practices from
government and other stakeholders believing that companies that engages in CSR practices has
seen to capture competitive edge compared to companies that do not perform CSR practices.
However, the world of business today has call upon more studies on corporate social
responsibility as the crucial and significant strategy to enhance company's economic
sustainability. Because it is observed that, there is lack of awareness and effective enhancement
of corporate social responsibility, as the reason to why corporate social responsibility has not
directly produces company's economic sustainability and that is the reason to why owners of
business are complaining that, CSR is a bit cost fully compared to the return it bring to the
company's economic sustainability. Company's owners do claim that involving in CSR requires
more of giving back to the society and expect gain in a long run, of which a bit difficult to most
of business is established to serve short run needs in developing countries like Tanzania.
Thus, the need for a company to invest in a long run business requires more emphasis on
implementing effective corporate social responsibility, which is rarely emphasized in developing
countries .These are more challenging circumstance that researchers and scholars they have yet
done a lot on it particularly in Tanzania, that is why corporate social responsibility has faced a
complex shift in term of awareness and implementation on both developed and developing
countries. The study addressed what should be done to make sure that, corporate social
responsibility influences the achievement of company's economic sustainability particularly in
Tanzania, Nyanza Bottling Company Limited being a case study.
42
Therefore, this study intends to establish how strong CSR impacts company's economic
sustainability in Tanzania, an aspect that has not given enough weight by the Authors, Theorists
and researchers over a long period of time especially in Tanzania where CSR is seen as a cost
fully strategy to implement.
43
CHAPTER THREE
RESEARCH METHODOLOGY
3.0. Introduction
This chapter identifies the approach and the population of the study, Together with that; the data
collection techniques used are presented with keen emphasis on the techniques that enabled the
study achieve its objectives. The chapter also covers data collection techniques and tools. In
addition, the chapter discusses the way validity and reliability of the tools was ensured while
stating the way data was analyzed. Finally, this chapter puts forward the way ethical matters
have been addressed and the resource requirement. Kothari (2004) defined research methodology
as a way to systematically solve a problem. It is a science of how research is done scientifically.
With respect to this definition, this study followed a scientific methodology. For that reason, its
methodology was channeled in a way that produces an objective and reliable knowledge.
3.1. Type of Research
This was an applied research aimed at finding the impact of corporate social responsibility on
company's economic sustainability. Applied research is carried on to find a solution to real life
problem requiring an action or policy decision. It is a problem oriented and action directed. It
seeks immediate and practical result. The purpose of applied research is to find solution to a
practical problem; it is a very incidentally contribute to the development of theoretical
knowledge by discovery of new facts (Krishnaswami,2003).
44
3.2 Research Design
Krishnaswami (2003) defines research design as a logical and systematic plan prepared for
directing a specific study. There are generally three types of research designs that a researcher
can adopt namely; exploratory, descriptive and casual research design ( Burns and Grove
2003,p.237).
This study adopts a descriptive research design which finds out what, where and how of a
phenomenon. Further this design enables the researcher to generalize findings from a sample to a
larger population. Descriptive data also allows the researcher to collect quantitative data which
can be analyzed an quantitatively using descriptive and inferential statistics ( Easwaran and
Singh 2010,p. 83). The great need of having systematic data where logic understanding of the
study was addressed. Necessity the need of having quantitative research design that carried at
Nyanza Bottling Company Limited (NBCL) in Mwanza region as a case study. Also the need of
clarity information necessity the need of qualitative research design, thus the research design
used mixed approach method whereby both quantitative and qualitative research approach were
efficiently deployed. The results of the findings were interpreted and concluded. For
comprehension of the study, a qualitative approach was used to supplement the interpretation of
the findings.
3.3 Area of Study
The study was carried out at Nyanza Bottling Company Ltd, (NBCL), incorporated in 1984, a
joint venture between SUMARIA and CMG group, is one of the largest Coca-Cola Franchises in
East Africa. Nyanza Bottling Company Limited (NBCL) is a subsidiary company of The
Sumaria Group of Companies, located at Nyakato industrial area along Nyerere road in Mwanza
45
City. The company was set up in 1987 and currently employs over 1000 people directly and
provides indirect employment to more than 4,000 people. The Company produces and distributes
carbonated soft drinks (CSDs) and noncarbonated beverages packaged in refillable glass bottles
(RGB) and plastic bottles (PET). The company has over 13000 outlets and serves over 12 million
consumers in six regions. NBCL being a participant of the training workshop conducted by
Cleaner Production Centre of Tanzania (CPCT) regarding Resource Efficient and Cleaner
Production (RECP) for enterprises and stakeholders in Lake Victoria Basin adopted the RECP
concept. To protect “The Coca-Cola Company Trade Mark” NBCL has put in place The Coca-
Cola Management System (TCCMS), which integrates quality, environment and occupational
health and safety. NBCL is engaged in bottling & distributing Coca-Cola products in the Lake
Zone of Tanzania, comprising Mwanza, Shinyanga, Mara, Kagera, Tabora Kigoma Geita &
Kahama regions. Parent companies, Sumaria and CMG Group are well known names in East
Africa having significant business presence in many industrial verticals.
NBCL- Corporate Social Responsibility
NBCL conducts its business activities with social responsibility by engaging in various
employees & social welfare measures and complying with Government regulations. NBCL also
significantly contributes to the economic growth of Lake Zone by employing people in the
bottling & Transport set-up and indirect business community. NBCL is one of the largest
contributors to the exchequer by way of VAT, Corporate Tax, Excise, PAYE, SDL, import duty
and other Government regulations related payments.
46
3.4 Population of the Study
Population is the targeted group to be studied; it is the total collection of elements about which
researcher wishes to make inference (Krishnaswami 2003). Since the study aimed to look on the
impact of corporate social responsibility on company's economic sustainability at NBCL in
Mwanza Region, the targeted population of the study included permanent employees of NBCL
in Mwanza Region and people outside the company ( customers), as the stakeholders relating to
CSR practices, where the practice of corporate social responsibility is executed effectively. The
number of the population was 550 people, management inclusive.
Table 3.1 Target Population
S/N Population category Population size
1 Managerial 275
2 Non- managerial 150
3 Customers
carbonated soft drinks customers
75
noncarbonated beverages customers
50
Total 550
Source: Researcher, 20018
47
3.5 Sample Size
Sample size is the number of items to be selected from the universe constitutes a sample. The
size of the sample should be neither excessively large nor too small, it should be optimal. An
optimum sample is the one, which fulfills the requirements of efficiency, representativeness,
reliability and flexibility (Kothari 2004). Sanders et al (2007), no survey can be deemed to be
free from error or provide 100% surety and error limits of less than 5% and confidence levels of
higher than 95% is regarded as acceptance. It is therefore important for researchers to select a
sample that is fairly representative. There are several ways of determining a sample size and so
which method to use depends on various factors such as time constraints, diversity of population,
population size and researcher's preference. Mugenda and Mugenda ( 2003) suggests that a
sample size of between 10%-30% is representative enough for the population if objectively
selected and elements are more than 30 in each identifiable group. In addition Sekara (2003) and
Bartleft et al (2001) recommend 100% rule in case of the population that is less than 100
participants. This research applied Mugenda and Mugenda (2003) of 27.3% ( within the range of
10-30%) of the population and sample size for the study are shown in table 3.2. From the
population, which stated to be 550 people from different level of strata was selected randomly
and being interviewed.
48
Table 3.2 Sample size from target population
S/N Population category Population size Sample size
1 Managerial Personnel 275 75
2 Non-managerial
Personnel
150 25
3 Customers:
carbonated soft
drinks customers
75
50
noncarbonated
beverages
customers
50
Total 550 150
Source: Researcher, 20018
3.5 Sampling Frame
Cooper and Schindler (2006), sampling frame is a list of elements from which the sample is
actually drawn and closely related to the population. In this particular study, the sampling frame
was drawn from various categories within existing CSR practioners and other stakeholders of
49
NBCL-Mwanza region. This sampling frame (2017), was used to ensure completeness and
relevance for the attainment of the study objectives.
3.6 Sampling technique.
In order to come up with an appropriate study sample, this study utilized stratified sampling
techniques whereby customers of NBCL products was classified into different category
including carbonated soft drinks (CSDs) and noncarbonated beverages packaged customers. The
rationale behind this selection of stratified sampling is because the customer of NBCL products
are diversely distributed in trading centers across central business of the region. Stratification
ensured collection of unbiased data. This approach helped to enhance the chances of greater
participation of potential respondents (Kothari 2008).
3.6 Nature of Data
This study employed both primary data and secondary data.
3.6.1 Primary source
The researcher directly collect data that have not been previously collected (Krishnaswami 2003)
from these original sources.
Primary data was collected from respondents at society surrounding NBCL in Mwanza Region
specifically in Nyamagana district, also other stakeholders of corporate social responsibility were
called upon to give assistance where necessary, (both environmental and human right agencies).
The researcher used questionnaires, which were prepared by the researcher and interview was
used to customers of NBCL and other stakeholders in a process of acquiring primary data,
50
whereby, environmental and human right agencies were categorized under customer of NBCL
products.
3.6.2 Secondary Source
These are source containing data, which have been collected and compiled for another purpose
(Krishnaswami, 2003). The documentary method largely used as the means of collecting data
that shows trends and performance of company in practicing corporate social responsibility.
Thus, company reports, prospectus and internal control system were used as the secondary
source of data.
3.7 Methods of Data collection
Primary data was collected using questionnaires and sometimes interview guides or schedules
where necessary. Secondary data was collected using specifically documentary review.
3.7.1 Questionnaire
Kothari (2004) defined a questionnaire as a set of questions printed or typed in a definite order or
a form or set of forms also Krishnaswami (2003) defined questionnaire as set of questionnaire
that will be given to the respondents who can read and fill the answers. In this study,
questionnaire was the main instrument for data collection where self administered questionnaire
was used to collect data in order to create rapport with the respondents to respond in accordance
with the questions asked and thus achieve noble responses. The researcher used questionnaire to
obtain information from the respondents. The questionnaires were distributed to different
respondents accordingly in order to obtain or extract information on the impact of corporate
social responsibility on company's economic sustainability.
51
3.7.2 Interview Guide
Researcher used this tool to collect data from individuals through face to face interaction. The
questionnaire guided interviewing some personnel and others CSR pioneers from different
category involved in CSR practices. Kothari (2004) this tool gives flexibility in questioning
process hence give a room for clarification where necessary. This study used this tool effectively
in accordance with the nature of the respondents especially when customers were called upon to
provide in-depth information of how they see CSR as the strategy towards company's economic
sustainability.
3.7.3 Documentary Review
Researcher used documentary review to collect data, which are relevant to the study. Secondary
data was collected using this tool of data collection. This has been presented by Kothari (2004)
as a method of obtaining information from documents such as reports, literatures and other
publication that contain relevant information for the study.
3.7.4 Pilot Testing
A pilot pre-test according to Robinson (2002) is the testing of one's instruments' with participants
who match the participants to be involved in the actual study. This is important in ensuring that
respondents understand the questions and making that the tools are measuring what they ought to
measure. Thus after development of draft questionnaire, a pilot test( pre- test ) was carried out at
NBCL-Mwanza whereby 25 managerial staffs, 15 non-managerial staffs and 25 customers of
NBCL products were involved to test any inconsistence, ambiguity, and incomprehension.
52
The pre-test participants did not participate in the actual survey in order to avoid pre-emption of
the study at the actual study area. In the process of piloting, the study aimed at ensuring the
rectification of any errors of ambiguity and repetitions existing in the research instrument.
Suggestions and corrections were incorporated in the final version as the amended final
questionnaire for distribution to participants.
3.8 Data Analysis
Once data are collected, the researcher described the techniques intended to analyze data
(Mugenda, 2003). Data analysis refers to examining what has been collected in a survey or
experiment and making deduction and inference. It involves uncovering underlying structures,
extracting important variables, detecting any anomalies and testing any underlying assumptions
(Kombo and Tromp, 2006). Data obtained from respondents during field study will be analyzed
using percentages, mean and range. Data was presented using charts, which include bar charts
and pie charts. In addition, graphs were used for presentation where necessary. Statistical
Packages for social science (SPSS) is the computer package, a tool that the researcher used to
analyze data and data presented descriptively through frequency tables and percentage. On other
hand, for qualitative data which is essentially text information collected in form of written notes
and scripts from interview was analyzed based on content analysis which involve looking at
patterns, themes and meanings.
3.9 Validity and Reliability
A pre study was conducted in order to guarantee validity and reliability. This pre study rendered
sufficient proof that the attributes of validity and reliability was achieved in manner that tools of
data collection that were selected, are compatible and flexible. Patton(2001) states that validity
53
and reliability are two factors which any researchers should be concerned about while designing,
analyzing and judging the quality of study.
3.9.1 Validity
Means the effectiveness or success of instrument in measuring the specific property, which
intends to measure. Measurement of abstract properly as attitude, morale and motivation are
indirect may give rise to the problem of the validity. It becomes necessary to gather some sort of
evidence to show that the concerned measuring instrument measure what is suppose to measure
(Krishnaswami, 2003). The researcher ensured that the instrument used are appropriate as so he
can exactly obtain what he need to obtain through the selection of appropriate methods of data
collection. Validity is concerned with the idea that the research design fully address the research
question and objectives that the research is trying to answer and achieve (Neumann). In all cases,
the researcher ought to be concerned with construct, external and internal validity (Yin 1994).
Construct validity is the degree to which scores on a test can be accounted for by construct of
sound theory ( Kothari 2008). In course of this study the criterion was satisfied by pre-testing the
questionnaires in pilot study in order to validate the questions and to correct ambiguities and
inconsistencies.
External validity relates to the generalizability of research findings from survey research to
entire population (Thomas & Nelson 2001,p.30). Since this research is not entirely statistical
study and the aim was to sample widely, external validity was attained by comparing current
research outcome with the previous studies that includes journals, thesis and term paper on the
same topic.
54
Internal validity addresses the extent to which the differences that have been found for the
dependent variable directly relate to the independent variables (Mackey and Gass 2005). In case
of this study, internal validity was achieved through specifying the units of analysis and
developing the conceptual framework that depicts the relationship between independent variables
and dependent variables.
3.9.2 Reliability
Means the ability of measuring instrument to give accurate and consistence result. An instrument
is stable if it gives consistence result with repeated measurement of the same object. The degree
of stability is determined by comparing the result of repeated measurement with the instrument
(Krishnaswami,2003). The researcher ensured reliability through having the better tools and
methodology for data collection. To satisfy this criterion in this study, the researcher pre-tested
questionnaire and interview guides whereby 25 managerial staffs, 15 non-managerial staffs and
25 customers of NBCL products were involved, and suggestions were incorporated in final
version of the questionnaire to ensure reliability of the instrument.
3.10 Ethical Concerns
The study addressed ethical issues by full disclosure of material facts of the study to the offices
in custody of the data. As a result: the study minimizes resistance from the stakeholders by
putting forward the benefit of the stakeholder.
Ethical concerns were addressed by creating an elaborate schedule that provide sufficient time
for each activity. As a result, sufficient data was gathered and compiled on time hence allowing
thorough review and verification of data that eliminates the danger of data fabrication leading to
objective and reliable results. This research incorporates and applied in advance the following
55
strategies to address critical ethical matters commonly encountered in empirical studies such as
this.
The researcher first obtained the go ahead approval from the research supervisor about matters
concerning research proposal including data collections before field work. Secondly, the
researcher secure a letter from sponsoring university ( St. Augustine University of Tanzania) to
introduce himself to various respondents at NBCL-Mwanza region.
Thirdly. every respondent to be involved in this study was informed of the purpose of the
research and be given assurance his/her names and personal identifying being gathered would be
for academic purposes only and that furnished data would be reported as aggregate rather than
individual analysis.
Furthermore, the respondents were informed that their participation in the research is voluntary
and they are free to withdraw anytime during the course of data collection. Also the researcher
respects the right of St. Augustine university of Tanzania and protects it from potential harm by
conducting research ethically, objectively and professionally. Finally, the researcher
acknowledges all sources of data and ideas presented in final version of the dissertation
according to APA reference style.
3.11 Study Funding
The study will be entirely funded by the researcher. This includes proposal writing, pre-data
collection up to report completion expenses. Due to this fact, the resource is limited and thus
dictate the entire study. To enable the study achieve its objectives despite of resource limitation ,
the scope and its methodology are set in respect to such limitation but without affecting the
quality of the study so as to arrive at results which are objective and reliable.
56
CHAPTER FOUR
FINDINGS AND DATA ANALYSIS
4.0 Introduction
In this chapter, the researcher presents analyses and interprets the findings of the study. The
findings are based on the data collected using open and closed questionnaires and interview, for
purposes of easier understanding, interpretation and analysis, the findings are presented analyzed
and interpreted in relation to five objectives that was set to answer. These were;
i. To examine the relationship between transparency and NBCL economic sustainability in
Tanzania.
ii. To assess the relationship between accountability and NBCL economic sustainability in
Tanzania.
iii. To find out the relationship between company's compliance and company's economic
sustainability at NBCL in Tanzania.
iv. To examine resource management on company's economic sustainability at NBCL in
Tanzania.
v. To assess the economic sustainability of NBCL in Tanzania.
Descriptive means of data analysis are mainly used backed by simple tables and
percentages. The results of the study are presented, analyzed and interpreted according to
the study.
4.1. Descriptive results
This section presents the results of the study findings based on the demographic characteristics
of the respondents and background information of the respondents.
57
4.1.1 Questionnaire response rate
In the course of this study, 150 questionnaires were administered. All of them were completed
and returned, this was because of the persistence follow-up that the researcher employed in the
course of data collection. This represents a 100% response rate which is regarded as very
excellent response. Table 4.1. Shows questionnaire response rate.
Table 4.1.: Questionnaire response rate
RESPONSE FREQUENCY Percentage
Returned 150 100
Total 100
Source: Research field Data, 2018
Table 4.2: Profile of Respondents
Education Particular
Level Number of respondents Percentage
Secondary certificate 35 23.3
Diploma/certificate 55 36.6
Bachelor Degree/Advanced
Diploma
60 40
Total 150 100
Age Particulars
Age interval Number of Respondents Percentage
20yrs-29yrs 45 30
30yrs-39yrs 50 33.6
40yrs-49yrs 35 23.3
50yrs-Above 20 13.3
58
Total 150 100
Working Experience
Number of years Number of Respondents Percentage
0yrs-3yrs 15 10
4yrs-6yrs 25 16.6
7yrs-9yrs 45 30
10yrs and above 65 43.3
Total 150 100
Status of Respondents Number of Respondents Percentage
Category
Managerial level 75 50
Non-Managerial level 25 16.6
Customer 50 33.3
Total 150 100
Gender
Male 90 60
Female 60 40
Total 150 100
Source: Primary Data, 2018
Gender
Table 4.2 shows respondents according to gender, the finding revealed that, 90(60%) of the
respondents were male while 60 (40%) were female. This implies that most of the employees at
NBCL-Mwanza are male. This is due to the fact, that men have been identified as a major power
of the company through which the main operations are done by them. They have been identified
a very responsible personnel whose efficiency, consistency, endurance, hard working and ability
59
to face difficulties are prominent features from which the company economic sustainability is
achieved.
Age
Table 4.2 shows respondents according to age, the finding revealed that, 45(30%) of the
respondents were between 20 to 29 years, 50 (33.6%) were between 30 to 39 years, 35 (23.3)
were between 40 to 49 years, while 20 (13.3%) of respondents were between 50 years and above.
It implies that, the company has a large number of teenagers and young people whose endurance
and hard working have been identified to be crucial in delivering their job competence. But also
the company has a reasonable number of adults whose knowledge and experience helps in
solving problem arises in day to day operation.
Working Experience
Table 4.2 shows respondents according to working experience, the finding revealed that,
15(10%) of the respondents were between 0 to 3 years, 25 (16.6%) were between 4 to 6 years, 45
(30%) were between 7 to 9 years, while 65 (43.3%) of respondents were between 10 years and
above. It implies that, the company has a large number of experienced workers whose
experience is 10 years and above, the company has managed to retain workers for a couple of
years which indicates that, the company has sustainable corporate strategy as far as corporate
social responsibility is concerned.
Respondents Status
Table 4.2 shows respondents status, the finding revealed that, 25(16.6%) of the respondents were
non managerial, 50 (33.6%) were between customers of NBCL-Mwanza, 75 (50%) were
60
between managerial. It implies that, the company has a large number of managerial personnel
due to fact that, the company has large number of department whose operation requires effective
management.
4.2. Response to Research objectives
4.2.1 To examine the relationship between transparency and NBCL economic sustainability
in Tanzania.
Table 4.3: Description of the relationship between transparency and NBCL economic
sustainability
Elements of Transparency Frequency Percentage
Corporate disclosure 65 43.3
Corporate Financial reporting 85 56.6
Total 150 100
Source: Primary Data, 2018
Table 4.3: Shows that 65 (43.3%) of the respondents indicated that NBCL - Mwanza has a wide
corporate disclosure, while 85(56.6%) of respondents indicates that the company has well
organized corporate financial reporting, of which these elements has embraced transparency of
the NBCL-Mwanza. From these findings, it is believed that transparency plays a vital role
towards company's economic sustainability, whereby Table 4.4 below indicates that transparency
increased market share and sales, help in building good image of NBCL-Mwanza, and
encourages investors to invest in NBCL-Mwanza. All of these happens as far as corporate social
responsibility practices are concerned.
61
Table 4.4: Description of how Elements of transparency impact NBCL-Mwanza economic
sustainability
Effects of Transparency Frequency Percentage
Increases Sales 82 54
Increases Market Share 37 25
Building Good Image 9 6
Encourages Investors 22 15
Total 150 100
Source: Primary Data, 2018
Table 4.4: Shows that 82 (54%) of the respondents indicated that transparency has help NBCL -
Mwanza increases sales, 37(25%) of respondents indicates that transparency plays a vital role in
increasing market share, 9(6%) of respondents indicates that, transparency has an impact on
building good image of NBCL-Mwanza, 22(15%) of respondents indicates that, transparency
encourages investors to invest in NBCL-Mwanza. All of these happens as far as corporate social
responsibility practices are concerned.
62
4.2.2 To assess the relationship between accountability and NBCL economic sustainability
in Tanzania.
Table 4.5: Description of the relationship between Accountability and NBCL economic
sustainability
Source: Primary Data, 2018
Table 4.4: Shows that, NBCL - Mwanza has managed to increase market accountability by
67(45%), 37(25%) of respondents indicates that accountability plays a vital role in increasing
both environmental and social accountability, 7(5%) of respondents indicates that, accountability
has an impact on political accountability of NBCL-Mwanza. All of these happen as far as
corporate social responsibility practices are concerned.
Elements of Accountability Frequency Percentage
Political accountability 7 5
Environmental accountability 37 25
Social accountability 37 25
Market accountability 67 45
Total 150 100
63
4.2.3 To find out the relationship between company's compliance and company's economic
sustainability at NBCL in Tanzania.
Figure 4.1: Description of the relationship between company's compliance and NBCL
economic sustainability
Source: Primary Data, 2018
Figure 4.1: Shows that, NBCL - Mwanza has managed to comply with government requirement
by 52( 35%) of the total respondents, investors requirement by 67(45%) , 22 (15%) of
respondents indicates that, compliance plays a vital role in complying with social requirement,
while 7(5%) of respondents indicates that, compliance has been adhered by the company as the
code of conduct of NBCL-Mwanza. All of these happen as far as corporate social responsibility
practices are concerned.
45%
35%
15%
5%
Compliance
Investors requirement
Government requirement
Social requirement
Code of conduct
64
4.2.4 To examine resource management on company's economic sustainability at NBCL in
Tanzania.
Figure 4.2: Description of how management of resource has brought about NBCL
economic sustainability
Source: Primary Data, 2018
Figure 4.2: Shows that, 67(45%) of the respondents indicated that utilization of resource has help
NBCL - Mwanza in attaining economic sustainability, 52(35%) of respondents indicates that,
internal control plays a vital role in managing resource of the company, 7(5%) of respondents
indicates that, resource management has been influenced by reporting, 22(15%) of respondents
indicates that, resource management has been influenced by resource planning of NBCL-
Mwanza. All of these happen as far as corporate social responsibility practices are concerned.
35%
45%
15% 5%
Strong effect
Internal conttrol
Utilization of resource
Planning for resource
Reporting for resource
65
4.2.5 To assess the economic sustainability of NBCL in Tanzania.
Table 4.6: Description of NBCL economic sustainability
Source: Primary Data, 2018
Table 4.5: Shows that 52(35%) of the respondents indicated that transparency has help NBCL -
Mwanza attain economic sustainability, 45(30%) of respondents indicates that accountability
plays a vital role in influencing NBCL-Mwanza economic sustainability, 37(25%) of respondents
indicates that, compliance has an impact on NBCL-Mwanza economic sustainability, 15(10%) of
respondents indicates that, reporting influences NBCL-Mwanza economic sustainability. All of
these happen as far as corporate social responsibility practices are concerned.
Elements of Economic sustainability Frequency Percentage
Transparency 52 35
Accountability 45 30
Compliance 37 25
Reporting 15 10
Total 150 100
66
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.0 Introduction
This is the last chapter of the study. It presents the discussion of the findings in line with the
study objectives, and the researcher derives conclusion and makes recommendations.
5.1 Summary of key Findings
5.1.1. To examine transparency on company's economic sustainability at NBCL in
Tanzania.
The findings revealed that, respondents of NBCL-Mwanza had appreciated transparency as one
of the corporate responsibilities practices that increases company's economic sustainability,
Table 4.3: Shows that 65 (43.3%) of the respondents indicated that NBCL - Mwanza has a wide
corporate disclosure, while 85(56.6%) of respondents indicates that the company has a well
organized corporate financial reporting, of which these elements has embraced transparency of
the NBCL-Mwanza. This has influenced company's economic sustainability whereby the results
in table 4.4 show that 82 out of 150, (54%) of the respondents felt that transparency increases
sales of the company of which it contributes to the economic sustainability of the company by
35%. They felt that it is important to prepare a good corporate disclosure reporting and well
organized corporate financial reporting, indicating how important is corporate social
responsibility in strengthening company's economic sustainability. In the course of this study,
company's stakeholders felt that, it's important for the company to be more transparent in their
operations as they felt that being transparent has a direct impact on the company's economic
sustainability.
67
In addition to that, these findings appear to agree with what John (2016) found in her study on
the impacts of Corporate social responsibility on image building a case of Nyanza Bottling
Company Limited. The study intended to establish the relationship between corporate social
responsibility and image building. He found that 9 (56.3%) respondents out of 16 said that
NBCL-Mwanza is sponsoring events that have an impact to both (company and society). In that
study, she concluded by saying that community or customers are significant part of the
organization development due to the reason that the organization depend much on customers‟
acceptance on what the organization produce. Due to this the organization should pay attention
to the society by conducting Corporate Social Responsibility in order to build the image of the
organization which in a long run enhance company's economic sustainability.
Furthermore, Omran (2015) conducted a study on Theoretical Perspectives on Corporate Social
Responsibility Disclosure. He found that social and environmental disclosures has flourished
over the past years with reporting on corporate social responsibility (CSR) information now
considered to be an important component, complementing financial reporting to reduce
information asymmetry. Whereby customers and investors are willing to engage with companies
that essentially practice CSR.
5.1.2. To assess accountability on company's economic sustainability at NBCL in
Tanzania.
The results indicates that, respondents of NBCL-Mwanza had appreciated accountability as one
of the corporate responsibilities practices that has an impact on company's economic
sustainability whereby 67 out of 150,(45%) of the total respondents indicated that, accountability
of the company influences the market in the company do operate, it's from this fact the company
68
is able to increase both sales (54%) and market share (25%) which are crucial for the existence
and economic sustainability of the company in a long run. Company's stakeholders felt that when
the company is able to increase both sales and market share, economic sustainability of the
company is inevitably achieved. Most the respondents indicated that the company should be
responsible for their actions as they tends to affect both society and environment at large. It is
through creating a good relationship between the company and society in which the company do
operate, stakeholders felt that the company has an opportunity to increase both sales and market
share.
In addition to that, these findings appear to agree with what Juliana Isanzu & Xu- Fengju (2016)
found in their study on Impact of Corporate Social Responsibility on Firm‟s Financial
Performance. The study intended to establish the relationship between corporate social
responsibility and Firm's Financial Performance. They found that CSR Return on Equity is 0.226
greater than that of Non CSR 0.017. This means that CSR firm‟s perform better than Non CSR
firms .In that study, they concluded by saying that in Tanzania social responsibility came about
with increasing competition as many companies flooded the country from various countries it
gained momentum because now consumers have many options to choose from (Mushi, 2007).
Now days CSR is used as a marketing tool for creating competitive advantage, ever since the
number of firms doing CSR in the country has been on the rise. Recently a CSR award has been
introduced which seeks to reward firms that make a greater contribution in the community
through their CSR practices and also encourage other firms that are yet to incorporate CSR in
their strategies to do so.
69
5.1.3. To find out the relationship between company's compliance and company's economic
sustainability at NBCL in Tanzania.
From now, there is no way a company may operate without abiding to the rules and regulations
of the society or an environment in which the company do operate. Compliance has became
more demanding in the world of business today, it is not an option rather the rule of the game.
The findings revealed that, NBCL-Mwanza respondents had appreciated compliance as one of
the corporate responsibility practices that Increases Company‟s appreciation from investors by
45%, investors are attracted to invest in a company that do comply with the rules and regulations
of the society they operate within. Stakeholders felt that, it's the government requirement(35%),
to comply with rules and regulations that abide business operations. From these finding,
economic sustainability of the company largely depends on the company's compliance. Although
some of the challenges are raised by the company's stakeholders whereby conducting corporate
social responsibility practices is seen as a burden to them because of the low budget that is
allowable to finance these activities, that is where government support is called upon to rescue
the situation. Most of the respondents believed that the burden of financing these activities
should be shared by both ( government and company), because these activities has an impact on
both.
In addition to that, these findings appear to agree with what Kumar (2016) found in his study on
Corporate social responsibility: Mission possible, in India. He ascertained the role of corporate
social responsibility on social development and its significant impacts. Whereby several studies
have established that more the CSR spending better the reputation of the company and better will
be the profits. So, Companies will tend to spend more than the minimum stipulated 2% of
70
average profits in the years to come. He therefore strive to list the best case scenario of CSR as
per the new law and try to find out what could be achieved by giving a right direction to CSR of
these companies. He suggested that, companies that engage more in CSR spending will have
better the reputation of the company and better will be the profits. Thus , companies should
comply with the new law that requires companies to take full initiatives in enhancing and
implementing CSR practices.
5.1.4. To examine resource management on company's economic sustainability at NBCL in
Tanzania.
Company's efficiency and effectiveness largely depends on how does the company manage its
resource, management of resource is felt to be crucial if the company is to sustainable especially
economically. 67 out of 150, ( 45%) of the total respondents indicated that utilization of resource
is key resource management this is to show that, NBCL-Mwanza respondents appreciated that,
resource management as one of the corporate responsibilities practices that increases company's
economic sustainability. There is no way a company can be economically sustainable if there are
no proper utilization of resource, strong internal controls system, good resources planning and
resources management reporting, all of these are very crucial and of more important for business
long survival especially economic sustainability.
In addition to that, these findings appear to agree with what Ready & Thomson (2015) found in
their study on Environmental, social and Economic Sustainability: Implications for Actuaries
Science, in Sydney, Australia. Sustainability concerns will have a material effect on actuarial
assumptions and future liabilities and on the advice provided to clients. Despite these material
effects, the actuarial literature on this subject is limited to resource constraints and climate
71
change. Actuaries advise or are employed by institutional investors. As the need for institutional
investors to promote sustainability grows, actuaries need to provide solutions to how institutional
investors can incorporate sustainability issues in their investment decisions. This requires
measuring the sustainability of the entities our clients invest in, measuring the sustainability of
our client„s activities and measuring the effect of sustainability on economic returns.
5.1.5. To assess the economic sustainability of NBCL in Tanzania
The findings indicates that, NBCL-Mwanza respondents had appreciated that, corporate social
responsibilities practices has contributed to the economic sustainability of the company whereby
transparency contributed by 35%, accountability by 30%, compliance by 25% and finally
reporting by 10%. In the course of this study, respondents pinpointed some thoughts on how
they see corporate social responsibility practices, most of them indicated that corporate social
responsibility is the new economic strategy to the companies staffs, there should be a transition
period that left the company reluctant in coupling with these practices namely transparency,
accountability, compliances, and reporting.
The following studies agree with John (2016) on her study; the impacts of Corporate social
responsibility on image building a case of Nyanza Bottling Company Limited, Juliana Isanzu &
Xu- Fengju (2016) on their study; Impact of Corporate Social Responsibility on Firm‟s Financial
Performance and Kumar (2016) on his study; Corporate social responsibility: Mission possible,
in India. All of these studies signify the role of transparency, reporting, accountability and
compliance in enhancing company's economic sustainability as far corporate social responsibility
is concerned.
72
5.2 Conclusion
5.2.1. To examine the relationship between transparency and company's economic
sustainability at NBCL in Tanzania
Based on the findings in chapter four, it can be concluded that, transparency is key practice, as
far as corporate social responsibilities is concerned in attaining economic sustainability of
NBCL-Mwanza. Since, Transparency enabled the company to increase sales at the same time
increases market share, of which all these have an impact on company's economic sustainability.
5.1.2. To assess accountability on company's economic sustainability at NBCL in Tanzania
Based on the findings in chapter four, it can be concluded that, there is no way a company may
be economically sustainable unless accountability is among of the key practices, as far as
corporate social responsibilities is concerned in achieving economic sustainability of NBCL-
Mwanza. Since, accountability enabled the company to acquire great acceptance from the
market, social, environment and political responses, of which all these have an impact on
company's economic sustainability.
5.1.3. To find out the relationship between company's compliance and company's economic
sustainability at NBCL in Tanzania
Based on the findings in chapter four, it can be concluded that, company's compliance is among
of the key practices, as far as corporate social responsibilities is concerned in influencing
economic sustainability of NBCL-Mwanza. Since, company's compliance enabled the company
to acquire great acceptance from investors, large number of investor are willing to invest in a
company that do comply with rules and regulations of the country. Also gaining acceptance
73
from social, environment and political responses, of which all these have an impact on
company's economic sustainability.
5.1.4. To examine resource management on company's economic sustainability at NBCL in
Tanzania
Based on the findings in chapter four, it can be concluded that, company's resource management
is among of the key practices, as far as corporate social responsibilities is concerned in economic
sustainability of NBCL-Mwanza. Since, company's resource management enabled the company
to attain effective resources utilization and effective internal control system, of which all these
have an impact on company's economic sustainability of the company.
5.1.5. To assess the economic sustainability of NBCL in Tanzania
Based on the findings in chapter four, it can be concluded that, the economic sustainability of
NBCL-Mwanza is largely influenced by transparency, accountability, compliance and reporting,
as far as corporate social responsibility is concerned, of which all these ( transparency,
accountability, compliance and reporting), have an impact on company's economic sustainability.
5.3. Recommendations
5.3.1. Recommendation to the organization
The study recommends on the need of having effective corporate social responsibility as the
strategy towards company's economic sustainability, whereby NBCL-Mwanza should put more
emphasize on enhancing sustainable corporate social responsibilities. This is because sustainable
corporate social responsibilities have been identified as a major factor that enhances economic
sustainability of NBCL-Mwanza.
74
5.3.2. Recommendation to Government
The study recommends on the role that Government should play in supporting and promoting
companies that do engages in CSR practices. Whereby Government is advised to provide
incentives and subsidies to companies that effectively practice sustainable corporate social
responsibility. Because in doing so, the government influences more companies to engage in
corporate social responsibility practices of which these practices are beneficial to government,
society and companies.
5.4 Area of further research
This research was conducted at NBCL-Mwanza, which uses corporate social responsibility as a
sustainable strategy to economic sustainability of NBCL-Mwanza. Whereby the findings show
that there is a great and positive relationship between corporate social responsibility and
company's economic sustainability. Thus, it is suggested that, similar study should be conducted
to other organization in Tanzania to see if corporate social responsibility has an influence on
company's economic sustainability.
75
REFERENCES
A, Rowe, T, Bansal et al.Issue: Ten Steps to Sustainable business. Available on http||www. Com,
accessed on 29 January 2018.
Adams, C.A.(2002).Internal organization factors influencing corporate social and ethical
reporting: Beyond current theorizing. Accounting& Auditing and Accountability Journal.
Aras G & Crowther D (2008); Corporate social Responsibility reporting: A study in
desingenuity?. Journal of Business Ethics.
Bayoud N. S., Kavanagh M., and Slaughter G.,( 2012). Factors influencing levels of corporate
social responsibility disclosure by Libyan firms: A mixed study. International Journal
of Economics and Finance, 4, 13-29.
Bela I, A. R. (2008), Corporate social responsibility reporting in developing countries: The case
of Bangladesh, Ashgate Publishing, Aldershot, U.K.
Bowen, H. (1953). Social Responsibility of Businessman. Harper and Row: New York.
Blowfield M., a. M. (2008). Corporate Responsibility: A Critical Introduction. Oxford, U.K.:
Oxford University Press.
Blowfield, M., & Frynas, J. G. (2005). Critical perspectives on corporate social responsibility in
the developing world. International Affairs, 81, 499–513.
Carroll, A. B. (1999). Corporate social responsibility. Evolution of a definitional construct.
Business and Society, 38(3): 268-295.
76
Branco, M.C., and Rodrigues, L.L., (2008). Factors influencing social responsibility disclosure
by Portuguese companies. Journal of Business Ethics, 83(4), 685-701.
Carroll A B (1979); A Three dimensional conceptual model of corporate performance; Academy
of Management Review (4), 495-505.
Cooper, D. and Schindler P ( 2006), Business research Methods 9th
Ed. New Delly MC Graw-
Hill.
Creswell, J. ( 2014). Qualitative and Mixed approaches. London Sage Publications.
Cresswell, J.W. (2005). Designing and Conducting Mixed Method Research.
Crowther D & Ortiz Martinez E (2004); Corporate Social Responsibility: history and principles;
social responsibility world 102-107: Penagi Ansted University Press.
Deegan, C. (2002). Introduction: The legitimizing Effect of social and environmental
Disclosures- a theoretical foundation. Accounting, Auditing& Accountability Journal.
Deegan, C. & Unerman, J. ( 2006). Financial accounting theory: European
edition, McGraw‐Hill Education.
Easwaran, S.,& Singh, S. (2010). Marketing Research Concepts, Practices and Cases. Oxford
University Press, Seventh Edition.
Ernst & Young, Action amid the business response to climate change uncertainty: (Ernst &
Young Global Limited, 2010),Vol 9.
Freeman, R.E (1984 ). Strategic Management: A Stakeholder Approach; Pitman: Boston, MA,
USA.
77
Friedman, M. (1970). The social responsibility of business is to increase its profits. New York
Times Magazine. New York.
Gray R.H. and K.J.Bebbington (2001, forthcoming) Accounting for the Environment, 2nd
Edition
(London: Sage).
Hetherington J A C (1973); Corporate social responsibility Audit: A Management Tool for
survival; London, The Foundation for Business Responsibilities.
Indian Schedule VII of the Companies Act, 2013.
Jamali, D., Safieddine, A.M., and Rabbath, M., (2008). Corporate Governance: An International
Review, 16(5), 443–459.
Krishnaswami, O, (2003). Methodology of The Research in Social Sciences. New Delhi
Himalaya Publishing House.
Kombo, D.K. and Tromp, D.L.A, (2006). Proposal and Thesis Writing - An Introduction.
Nairobi: Pauline Publications.
Kothari C.R (2004). Research Methodology, Methods and Techniques ( 2nd
ed), New Delhi: New
Age International Publisher Wishws Prakashan: New Age International (P) Limited.
Publishers.
Kytle, B, Hamilton ,B.A., Ruggie, J.G (2005).Corporate social responsibility as Risk
Management. A model for Multinational: Social Responsibility initiative Working Paper,
MA.
Margolis and Walsh (2003).Rethinking social initiatives by Business: Misery Loves Companies.
78
M, Scilly (2018); Four Types of Corporate Social Responsibility Journal, accessed on 31
January 2018.
Mugenda, O. M., & Mugenda, A. G. (2003).Research Methods: Quantitative and Qualitative
Approaches. Nairobi: African Centre for Technology Studies.
Maignan, I., Ralston, D.A.,( 2002). Corporate social responsibility in Europe and the U.S.:
Insights from businesses' self-presentations. Journal of International Business Studies,
33(3), 497-514.
Neuman, W. (2006). Social Research Methods: Qualitative and quantitative approaches. 6th
Edn., USA: Pearson.
O‟Donovan, G. (2002). Environmental disclosures in the annual report the applicability and
predictive power of legitimacy theory. Accounting, Auditing and Accountability Journal,
15(3): 344-371.
Patton, M. ( 2002). Qualitative Evaluation and Research Methods. 3rd
Edition, London-Sage
Publications.
Roberts, R. W., (1992). Determinants of corporate social responsibility disclosure: An
application of stakeholder theory. Accounting, Organisations and Society, 17(6), 595-
612. Ross, S. A., (1977). The determination of financial structure: The incentive signalling
Approach, Bell Journal of Economics, 8(1), 23 – 40.
Robson, C. ( 2002). Real world research.2nd
Ed, Malden, MA: Blackwell Publishing.
Saunders, M, Lewis, Pand Thornhill ( 2009). Research methods for business students. London
F/T Pitman
79
Shaping Corporate Social Responsibility in sub-Saharan Africa Guidance Notes from a Mapping
Survey. Accessed on 31 January 2018.
Sekaran, U. ( 2003). Research Methods for Business: A Skill building approach. New York: John
Thomas, J., & Nelson, J. ( 2001). Research Methods in Physical Activity. 4th
edition, Champaign
IW.
http://www.nbcl.com (accessed on, January 12, 2018)
Towers Perrin (2009): Corporate Social Responsibility: It's No Longer an Option. Available on
http://www.towersperrin .com/tp/showdctmdoc.jsp, (accessed on) (29/01/2018).
Van Marrewijk, M., (2003). Concepts and definitions of CSR and corporate sustainability:
Between agency and communion. Journal of Business Ethics, 44, 95-105.
Waddock. S.A et. Al (2002) Responsibility. The New business imperative Academy of
Management Executive. Vol 16 (2),p.134.
80
APPENDICES
Appendix I: Questionnaire for employees of Nyanza Bottling Company Limited (NBCL)
A. Introductory letter
Dear Respondent,
I am JACKSON, Zacharia a student pursuing Master in Business Administration- Accounting
(MBA) at St. Augustine University of Tanzania conducting a research on the Impact of
Corporate Social Responsibility on Company's economic Sustainability. A case of Nyanza
bottling company in Mwanza city.
This study is pure for academic purpose and to be awarded a Master of Business Administration
in Accounting. Your information will remain confidential, also the success of the study will
depend on your response with high cooperation by giving out the correct
answer.
B. Preliminary Information
Tick (√ ) where appropriate
1. Age
a) 20-29 ( )
b) 30-39 ( )
c) 40-49 ( )
d) 50-59 ( )
81
2. Gender
a) Male ( )
b) Female ( )
3. Educational level
a) University ( )
b) Secondary ( )
c) Primary ( )
C. Basic Information
4. Before conducting CSR activities what things do you consider?
a) Request from the society ( )
b) Policy of an organization ( )
c) All of the above ( )
Add if there others
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
82
5. What are the CSR activities do you conduct towards company's economic sustainability?
a) Sponsoring various events ( )
b) Contribution on different social services ( )
c) All of the above ( )
Mention if there others
6. How does transparency impact company's economic sustainability at NBCL in Tanzania?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
7.Does accountability impact company's economic sustainability at NBCL in Tanzania?.
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
8. Is there a relationship between company's compliance and company's economic sustainability
in Tanzania?.
………………………………………………………………………………………………………
………………………………………………………………………………………………………
……………………………………………………………………………………………………..
9. Resource management has anything to do with company's economic sustainability?.
83
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
10. What is the status of economic sustainability of NBCL in Tanzania?.
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
10. What is the economic sustainability of NBCL in Tanzania?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
11. How does CSR contribute to economic sustainability of NBCL in Tanzania?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
……………………………………………………………………………………………………..
THANK YOU
84
Appendix II: Questionnaire for customers of Nyanza Bottling Company Limited (NBCL)
A. Introductory letter.
Dear Respondent,
I am JACKSON, Zacharia a student pursuing Master in Business Administration- Accounting
(MBA) at St. Augustine University of Tanzania conducting a research on the Impact of
Corporate Social Responsibility on Company's economic Sustainability. A case of Nyanza
bottling company in Mwanza city.
This study is pure for academic purpose and to be awarded a Master of Business Administration
in Accounting. Your information will remain confidential; also the success of the study will
depend on your response with high cooperation by giving out the correct answer.
B. Preliminary Information
Tick (√) where appropriate
1. Age
a) 20-29 ( )
b) 30-39 ( )
c) 40-49 ( )
d) 50-59 ( )
2. Gender
a) Male ( )
85
b) Female ( )
3. Education level
a) University ( )
b) Secondary ( )
c) Primary ( )
C. Basic Information
4. Does Nyanza bottling company participate effectively in improving social
development?
If YES how, If NO why.
………………………………………………………………………………………………………
………………………………………………………………………………………………………
……………………………………………………………………………………………………...
5. In which ways do Nyanza bottling company offer support to the society surrounding the
organization?
a) Education support ( )
b) Health support ( )
c) Environment control ( )
d) Providing Aids to orphans ( )
86
e) All of the above ( )
If there others, mention
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
6. What are the effects you get from Nyanza bottling company being around your society?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
7. What are your suggestions towards Nyanza bottling company towards company's economic
sustainability?
………………………………………………………………………………………………………
………………………………………………………………………………………………………
………………………………………………………………………………………………………
THANK YOU
87
Appendix III: A guide to customers of NBCL-Mwanza products around the Plant-
Nyamagana District
1. Please tell me what do you understand the term Corporate social Responsibility?
2. What does NBCL-Mwanza perform as far Corporate social Responsibility is concern?
3. In your opinion. are these activities of more important to your society?
4. Does the following components helps the company achieve better sales and increase market
shares;
(i) Transparency
(ii) Accountability
(iii) Compliance
(iv) Corporate reporting
5. What do you think are the reason for NBCL-products acceptance in Mwanza region
particularly at Nyamagana District?.
6. Is CSR has anything to do with NBCL-Mwanza economic sustainability?.
7. What advice would you give to companies that do engage in CSR practices?.
8. What advice would you give to policy makers and other CSR stakeholders to encourage more
companies to engage in CSR practices?.
Top Related