The effect of corporate social responsibility on the financial performance of telecom companies

Abstract

The study investigated the effect of Corporate Social Responsibility on the financial performance of telecom companies using MTN Uganda as the case study. The study was guided by the following objectives: To establish whether environmental responsibility affects profitability of telecom companies, To examine the role of economic responsibility on the liquidity in telecom companies and To determine whether social responsibility affects turnover in telecom companies. The study used a case study design approach. The sample size of 45 respondents comprised of the following categories of people who responded to our questionnaire: Management, Finance department, Human resource and working stuff. The study found that organizations participate in all round activities that benefit the environment and also that it is important for all employees of the organization to participate in activities that benefit the environment. Organizations are also committed to being as profitable as possible, it is important that a company be consistently profitable and also that the company gains reasonable profitability. It is important to maintain a high level of operating efficiency. Company respects and follows societal values, often gives back to the society all around the country and also has a low labour turn over. Further equal opportunities for rewards and advancement are provided to all employees for a company to be socially responsible and all stakeholders of the company are treated equally important and are pleased with the company’s social responsibility. Finally, it is recommended that executive management needs to get involved in CSR initiatives by formulating business strategies that embed CSR practices in business operations, and undertaking sustainable operations. CSR strategy should carefully be aligned into business strategy in order to reinforce governance and sustainable value generation in the organization and society as a whole. It is also recommended that Government needs to provide an enabling environment for SMEs while encouraging other corporate bodies to follow suit. There is need to align CSR activities with development goals in order to create sustainable value with in communities. This can only be achieved with government support through partnership of the public and private sectors