Journal of Emerging Trends in Economics and Management Sciences: Home

Article Title:
Corporate Social Responsibility in Small and Medium Enterprises (SME) in Sri Lanka
by M.A.T.K. Munasinghe and A.P. Malkumari

Abstract:
Corporate social responsibility (CSR) remains a broad, complex and continually evolving concept that encompasses a variety of ideas and practices. Practice has so far primarily been concentrated on the large multinational enterprises, but its wider application in SMEs is of central importance, concerning their contribution to the economy and employment performance and to contribute to the economic development of the society. Concerning the growing importance of the SME sector in Sri Lanka, this study mainly focus on gaining an initial insight to the nature, perception and the extent of the application of the CSR concept in the small and medium enterprises. The concept was measured through four dimensions of stakeholder theory derived from the literature namely environment protection, employee care, Community care and employee concern. Fifty number of semi structured questionnaires were collected from owner/managers of small and medium sized firms operating in Western province, spanning a variety of industries and the data was analyzed using non parametric statistics. Results revealed that majority of firms believe that they should pay attention to their social and environmental responsibilities. The familiarity with the term CSR, involvement and the regularity of CSR activities undertaken were high in medium size firms than in smaller ones. The community was the most cited stakeholder, followed by the environment. Customers and employees in their definition of CSR. All industries in the sample indicates that the motivation factor for adapting CSR is to improve firm?s reputation, employee motivation and to improve economic performance while ethical and moral reason reserves the least importance as a motivating factor for CSR. The main barriers were lack of money and attitude of no benefit in short run.

Keywords: corporate responsibility, SME, reporting practices, social responsibility, ethical practices

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