How Investing in Corporate Social Responsibility Can Give Companies a Competitive Advantage

This research will examine the theory around CSR activities and how they can be a source of competitive advantage to an organization to understand how, where, and when firms can invest in CSR to gain a competitive advantage over their rivals in the industry. To achieve this, the researcher will use an explorative research design to collect data from two firms; MacAfee and Nescafe to find answers to the underlying research question. This study will be conducted through email and phone interviews within two months starting November into late December, and the study findings shall be presented in January 2019.   Contents Introduction 4 Research question 5 Review of Literature 5 Introduction 5 The Corporate Social Responsibility Today 5 CSR as Strategic Necessity and Competitive Advantage 7 Competitive Advantage 8 The theoretical framework 9 Conceptual Framework 10 Methodology 10 Qualitative Research Method 11 Sample selection 11 Inclusion criteria 12 Interview Subjects 12 Data Collection and Analysis 13 Foreseen limitations 14 Research schedule/ Timeline 15 References 16 Introduction In the contemporary business environment, there have been several debates about the role of corporations to the society.

The term Corporate Social Responsibility (CSR) has been used over the past few decades with a major concern on the ongoing debate on whether business entities should concentrate on making profits or they should be involved in other activities that go beyond the entity to benefit the societies in which they operate. It provides an overview of some arguments which will contribute towards the understanding of how an entity’s investment in CSR gives a firm a competitive advantage over the competitors in the industry. The Corporate Social Responsibility Today The concept of Corporate Social Responsibility has been explored and developed over the last few decades and various definitions being generated from the idea. Over the recent years, there has been an increased interest in CSR and businesses and managers have become more aware of the concept of CSR (Quairel-Lanoizelee 2016).

Corporations have become more aversive to CSR, and there are more expectations and pressure that firms should be engaged in Corporate Social Responsibilities (Martinuzzi and Krumay 2013). CSR as a firm’s consideration to respond to the issues that are beyond a narrow technical, legal, and economic requirements of the firm (Porter and Kramer 2006). The use of power and corporate social responsibilities are highly correlated and become even more pronounced with the advent in globalization. In a survey, El et al. (2013) established that most managers believe that organizations get involved in CSR for other reasons other than doing them for economic, legal, or ethical responsibilities. Conversely, Karasavvoglou (2011) found out that entities get involved in CSR practices to focus on the issues which may be said to be legal, economic, or ethnically motivated.

With these regards, it is evident that firms are engaged in corporate social responsibilities but each of them having diverse objectives. CSR as Strategic Necessity and Competitive Advantage Over the last few decades, there has been a contradiction as to why firms should be engaged in CSR activities. After a comprehensive analysis of the contemporary business environment and its robustness, it is no longer the question of if; instead, it is how it can pay off (El and Shawky 2013). In the same line, Lee et al. (2016) confers that the competitive conditions in the current business world have put pressure on firms to start engaging themselves in CSR activities for them to appeal to the consumers. Aside from appealing to the consumers, other interest groups in the society have their expectations on these firms, and this may influence them to get engaged in CSR.

Firms should not overrate the role of stakeholders or the other schools of thought (Porter and Kramer 2006). In their article, Martinuzzi and Krumay (2013) give a framework with which organizations may integrate social issues in the firm’s operations for them to gain a competitive advantage. This framework identifies the generic social factors which are considered essential to the society but less critical to the organization. Saeidi et al. (2015) suggest that the activities on the value chain are always crucial to the community and they can improve the firm’s operations based on social issues thus giving a firm a competitive advantage. This will be achieved by obtaining stakeholders’ perception as well as a firm’s vision into the future. The stakeholders will be defined and using attributes such as power, legitimacy, and urgency.

This will further classify them as expectant, definitive, and latent stakeholders (Kim et al. The theoretical framework shows that investing in CSR can give a firm competitive advantage Conceptual Framework This theory will be applied to analyze how a firm’s engagement in Corporate Social Responsibility is impacted by four main factors which include environmental, economic, social, and ethical practice. Methodology Eriksson and Kovalainen (2015) have proposed some guidelines that researchers need to follow when selecting a research design. By considering the requirements for this study, the researcher will use purposeful sampling to get relevant information from the identified firms to allow the researcher to answer the research question. The researcher will divide the sample into two categories; one for the stakeholders and the other one for firms.

In the case of each firm, the manager will represent the views and vision of the firm while stakeholders’ views will be used to give more information about gaining a competitive advantage by investing in CSR activities. Inclusion criteria Appropriate firms will be chosen using the following criteria: • Have a clear known Corporate Social Responsibility activity. • Have one or more Corporate Social Responsibilities. Eriksson and Kovalainen (2015) have outlined three types of interviews, structured, semi-structured, and unstructured interviews. In structured interviews, a researcher formulates a standard set of questions, and there is the use of qualitative measures. Unstructured interviews give the respondents the full liberty to respond without following a particular outline. For semi-structured interviews, the researcher formulates questionnaires using theory where questions and respondents are determined beforehand (Eriksson and Kovalainen 2015).

The collected data will be organized in the form of tables and converted into numerals where it will be analyzed by the SPSS software version 20. Although this is a cheaper method, the researcher will not be able to read the body language of the respondents. In qualitative research, a researcher takes into consideration several attributes including what they observe. For this case, observation will not be possible. Research schedule/ Timeline This research will be conducted within two months starting from November into December this year. Afterward, the researcher will compile the data, analyze, and give interpretations in January 2019. Eriksson, P. and Kovalainen, A.  Qualitative methods in business research: A practical guide to social research. Sage. European Commission.  The economies of the Balkan and Eastern Europe countries in the changed world.