RESEARCH ARTICLES

 

Perceptions regarding corporate citizenship behaviour in a developing country

 

 

EE Smith^I; NE Mazibuko^II; I Muzvidziwa^III

^INelson Mandela Metropolitan University Elroy.Smith@nmmu.ac.za
^IINelson Mandela Metropolitan University Noxolo.Mazibuko@nmmu.ac.za
^IIICohglan Investments, Harare, Zimbabwe

 

 

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ABSTRACT

This article sets out to examine perceptions regarding corporate citizenship behaviour within a province in Zimbabwe. A quantitative research approach was followed.
A non-probability sampling technique by means of a convenience and judgemental sample of 500 respondents was drawn from the designated population. A survey was conducted by means of a self-administered structured questionnaire. A total of 419 usable questionnaires were received from respondents. Various statistical analysis techniques were used such as descriptive statistics and frequency distributions, exploratory factor analysis, Cronbach's alpha reliability testing and correlation analysis and regression analysis. Seven null-hypotheses were initially developed to test the relationship between the independent, mediating and dependent variables.
The findings indicated that three independent variables were related to strategic planning issues regarding corporate citizenship (CC) behaviour, namely organisational social responsibility, personal characteristics and market orientation, while only two dependent variables were related to operational planning issues regarding CC behaviour, namely organisational social responsibility and personal characteristics. Perceptions regarding CC behaviour impacts organisational performance and organisational sustainability of organisations in Zimbabwe.

Key phrases: citizenship; corporate citizenship behaviour; social responsibility

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1. INTRODUCTION

Organisations are a public culture, in their own right, in terms of being politically, socially and economically focused (Birch 2001:53). It is evident that worldwide, organisations are prioritising corporate citizenship (CC) for their organisations and uses annual reports to inform stakeholders about the performance of the organisation (Mirvis & Googins 2006:1). The most prevalent concept to date is corporate social responsibility (CSR) which is regarded as the flagship of contemporary organisational-societal relations. CSR manifested in the 1950s and the concept became a topical issue around 1970s (Carroll 1999:263).

The original definition of modern CSR is found in the four-part model of CSR by Carroll (1979:497). CC has arisen as a conspicuous term in the literature dealing with the social role of business. CC has been implemented among various consultants and government units in reference to an organisation's social and environmental policies (Roberts, Keeble & Brown 2002:Internet). Furthermore, from the 1990s onwards, the existence of the new term CC gradually contends with and acts as a substitute for this and other existing philosophy in the management domain of theory and practice. The surfacing of CC rendered the old terminology of stakeholder management and CSR inappropriate in the current discourse (Noeiaghaei 2009:7).

According to Van Luijk (2001:9), the developments pointed out that the way in which organisations had been conducted was not favourably in the industry, due to the absence of the concepts of CSR and organisational ethics in the world of business. Admittedly, these terms were used as a reminder to organisations that they should give back to society. Waddell (2000:107) posits that citizenship's focal point is the rights and responsibilities of all members of the community, as communally interlinked. An analysis of the research in these related areas suggests that CC can be defined as the extent to which organisations undertake the compulsory economic, legal, ethical, and discretionary responsibilities imposed on them by their stakeholders (Maignan & Ferrell 2001:38).

Although both CSR and CC refer to conduct of organisations in society, the former centres solely on the responsibility aspect of the organisation while the latter focuses on an organisation as a social player by virtue of both its rights and responsibilities as a citizen (Du, Bhattacharya & Sen 2007:145). In support of these primary changes, the term CC recognises organisations as legal persons with certain rights and responsibilities as members of a community (Du et al. 2007:145). In addition, Lockwood (2004:Internet) asserts that the upsurge in undertaking acts of social responsibility illustrates that CC tends to be a strategic measurement that investors use to consciously align ethical concerns with publicly held organisations. However, Matten and Crane (2003:111) hypothesise that CC appears as a branding or re-launching of existing facts in order to be more appealing to the organisation as CSR lacks a clear normative trait. Against this background, KPMG (2005:5) and Welford (2004:31) postulate that Zimbabwe as a developing country lags behind first world countries and many other African countries in the adoption of CC practices.

The first part of this article covers the problem statement, objectives, hypothetical model of the study and the hypotheses. Thereafter, a theoretical overview of CC and the research methodology are provided. The last part highlights the main empirical results and conclusions and recommendations.

 

2. PROBLEM STATEMENT

CC became an essential part of any successful organisational plan; it affects its share price, long-term viability and bottom line (D'Amato, Henderson & Florence 2009:8). In most cases, organisations find that they are not participating in citizenship; the literature has however suggested that there are organisations which have mastered the reporting aspect of CC and may be proactive in their programmes, but lag behind in transparency (Mirvis & Googins 2006:8). There appears to be acceleration in the growth of CC to integrate organisational responsibility and the organisation in society (D'Amato et al. 2009).

Despite this notion there seems to be no common understanding about the precise definition of CC with limited reference that it makes usage of the term "citizenship" beyond being part of a common community (Matten & Crane 2003:4). It further appears that most research on philanthropy and citizenship are based on organisations and institutions in developed market economies, yet very little is known about the role, operations and innovative potential of philanthropy in other parts of the world (Anheier, Simmons & Winder 2007:3).

However, it is clear that expectations of organisations have grown over the last two decades and are expected to contribute to society. Many developing countries are at the elementary stage in terms of CC because CC activities seem to be intermittent and undeveloped (Smit 2013:270). Most organisations focus on obeying the law and protecting the organisation's reputation and, in many cases, these organisations take a defensive standpoint against outside pressures (Mirvis & Googins 2006:7).

In Zimbabwe, to a certain extent, CC in some organisations has made progress, even though there is a distance yet to be travelled to complete the journey toward making CC a reality, and toward expanding the purview and impact of the organisation in society (Kakava, Mbizi & Manyeruke 2013:678). Conversely, a lot has to be done among organisations to continue the progress of CC, in both intellectual and practitioner realms. An equally significant point to note is that, in order for it to be successful an effort has to be made in promoting CC by both the private sector and the government of Zimbabwe (United Nations Zimbabwe 2011:1).

Against this background, the main research question to be addressed in this study is: What are the perceptions regarding CC behaviour in Zimbabwe as a developing country?

 

3. OBJECTIVES

3.1 Primary objective

The main objective of this study is to investigate perceptions regarding CC behaviour in Zimbabwe.

3.2 Secondary objectives

To address the primary objective, the following secondary goals have been formulated:

■ to provide a comprehensive literature overview of CC;

■ to develop a measuring instrument to empirically assess the perceptions regarding CC behaviour in Zimbabwe;

■ to empirically assess CC behaviour in Zimbabwe; and

■ to provide managerial guidelines for implementing CC in Zimbabwe.

 

4. HYPOTHETICAL MODEL AND HYPOTHESES OF THE STUDY

The initial literature study has revealed a number of CC factors that could enhance its practice in the Zimbabwean organisations. Based on such factors, the following hypothesised model is proposed.

Figure 1 illustrates the link between the independent variables, which are the internal organisational factors, external factors and personal factors. However, these factors have a bearing on the moderating variable which, in this case, perceptions regarding CC behaviour. This moderating variable has an impact on the dependent variables which will result in a company yielding competitiveness, high performance, portraying a positive image and sustainability. Seven null-hypotheses were formulated and tested.

 

 

5. THEORETICAL OVERVIEW OF CC BEHAVIOUR

5.1 Clarification of key concepts

■ Corporate citizenship (CC)

Crane, Matten and Moon (2008:83) define CC as a lifeline of the society that shows progress and they investigate three dimensions of the organisation as a citizen, as a citizenship proprietor and as a citizenship field for stakeholders. In support of this notion, Shkolnikov and Sullivan (2004:3) postulate that being a good corporate citizen means taking care of the short-term profits, taking into consideration the desires and anxieties of diverse stakeholders, pressing forward principled standards and encouraging superior organisational surroundings. According to Johnstone (2008:7), CC is defined as surpassing philanthropic acts in terms of economic and social contribution.

■ Corporate social responsibility

CSR has been referred to as organisational ethics, in the workplace, government, communities and the media (Lockwood 2004:Internet). The World Business Council for Sustainable Development (WBCSD) (2001:Internet) defines CSR as the organisational obligation and benefaction to the calibre of life its employees, their relations together with the entire humanity to be financially viable in terms of social growth.

5.2 Nature of CC behaviour

Apart from focusing on fulfilling their economic and legal obligation, organisations have some responsibility to society as well (Carroll & Shabana 2010:85, Sarbutts 2003:340). CC is a structure of an organisation in which self-regulation is incorporated into an organisational model (Lam 2009:137, Maxfield 2008:367, Torres-Baumgarten & Yucetepe 2009:217). CC is defined as an organisation engaged in activities that develop a common plan beyond what is expected by regulation (Siegel & Vitaliano 2007:773).

Emphasis has been placed on the incorporation of CC into an organisation's policy in order to make sales and gain profits. However, organisations participate in a social context for accountable patrons by unambiguously connecting their collective input with artefact sales (Baron 2001:7). However, a variety of subject matters restarting the affiliation involving the organisation and the general public as well as the innate milieu has since been developed (Martí-Ballester, Rovira-Val & Drescher 2013:2).

Alongside the expansion of diverse subject matter and terms, organisations inspect their community and natural undertakings; consequently, divergent advancement in these proceedings have thrived as well (Garriga & Melé 2004:51, Porter & Kramer 2006:78). CC and the role of organisations in society have been discussed for centuries by various organisations (Locke 2003:Internet).

Furthermore, Harribey (2011:23) is of the opinion that it is a significant risk for an organisation not to take CC on board since it has now become convention to integrate a framework of sustainable development into business practice. The WBCSD is in support of this notion, it cites that organisations cannot linger on one side, since they form a fundamental component of the society and cannot go on with the production of affluence if the adjoining world is disintegrating (WBCSD 2001:16). CC embraces all the facets of corporate social responsibility, responsiveness and performance (Carroll & Buchholtz 2008:60). It is thus proposed that CC can be applied to remedy the decline of CSR by launching the regularising agenda essential for the discretionary parameter (Whitehouse 2003:312).

5.3 Fundamental characteristics and components of CC

The core characteristics of CC are features of the concept that tend to place CC in the limelight. CC does not have a clear definition and the term is often used interchangeably with other concepts, previously mentioned, and these have also been addressed as components of each other without being precisely defined and distinguished from one another (Grit 2004:97, Sharma 2004:116; Verschoor 2006:21). The following are some of the core characteristics of CC and various researchers concur with this notion (Küskü & Zarkada-Fraser 2004:59 and Waddock 2002:5):

■ Voluntary - activities of the organisational citizenship go beyond financial commitment (Margolis & Walsh 2001:13, McWilliams & Siegel 2001:120).

■ Internalising or managing externalities - comprehend the organisation as a component of society, contributing to the well-being of society (Ward 2003:1).

■ Multiple stakeholder orientation - managers have to consider the needs of other stakeholders when formulating choices (Greenley, Hooley & Rudd 2005:1483).

■ Alignment of social and economic responsibilities - organisations are expected to relate to sustainability principles in regards to the manner in which they carry out their pursuits; that signifies the enclosure of community and biodegradable interests in organisational performance and in communication with stakeholders (Marrewijk 2003:95).

■ Practices and values - organisations are fashioned by the general public and draw their legality from the social order in which they function and they are required to be proficient in order to articulate their objectives as well as identify with their packed societal and ecological impacts and undertakings (McIntosh, Thomas, Leipziger & Coleman 2003:16).

■ Beyond philanthropy - CC is moving beyond the boundaries of legal compliance and long-established patronage to become a more central factor in shaping organisational success and legitimacy, with implications for organisational strategy, governance and risk management (Nelson 2004:2).

Huniche and Pedersen (2006:29) outline four main components of CC behaviour as economic, philanthropic, legal and ethical responsibilities. The principal role of organisations is to produce goods and services that consumers needed and wanted and to make an acceptable profit in the process.

Business is expected to comply with the laws and regulations promulgated by government as the ground rules under which businesses must operate. Ethical responsibilities embody those standards, norms, or expectations that reflect a concern for what consumers, employees, shareholders, and the community regard as fair, just, or in keeping with the respect or protection of stakeholders' moral rights (Corrigan & Farrell 2010:53). Philanthropy encompasses those corporate actions that are in response to society's expectation that businesses be good corporate citizens. This includes actively engaging in acts or programs to promote human welfare or goodwill (Podnar & Golob 2007:326).

5.4 Drivers for corporate citizenship (CC)

According to Ward and Duray (2000:123) and DeSimone and Popoff (2000:47), external expectations of organisations are changing rapidly and consumers are reportedly adding up demands concerning how the commodities that they procure were manufactured; this has the propensity to turn into hasty procedures which are less likely to be of assistance to progress in the vicinity of sustainability.

The external forces that influence an organisation include the socioeconomic and socio-political factors (Mirvins & Googins 2006:119). The external drivers have an inclination towards large-scale foundations and refer to forces from outside the nation, while the internal drivers point to forces emanating from within the state (Mirvins & Googins 2006:119, Visser 2008:481). These drivers consist of international standardisation; crisis response stakeholder activism; investment incentives and supply chain.

Additional internal forces include risk management and fortification of organisational renown, as well as improvements in economic values (Lantos 2001:595). Mirvis and Googins (2006:123) reiterate that consumers and customers have the potential to influence the development by putting pressure on organisations to reveal how they manufacture the commodities they buy; at the same time, they possess the power to choose which services or products are manufactured. One of the main drivers in large organisations has been ethical leadership (Szekely & Knirsch 2005:628). Table 1 indicates the main internal and external drivers of CC behaviour.

 

 

6. RESEARCH METHODOLOGY

6.1 Research paradigm

A quantitative research approach was used in this study to collect data in order to establish the relationship between pre-defined variables. The research has to employ strategies of inquiry using a survey to collect data on predetermined instruments that yield statistical data.

6.2 Research approach

As quantitative research was used, both an exploratory and descriptive approach were employed as to describe the perceptions regarding CC behaviour in Zimbabwean organisations.

6.3 Population

In this study, the population comprised of all managers and employees of multinational organisations, major institutional investors and small and medium enterprises. The target population consists of all the managers and employees from a total of 2405 listed organisations (Zimbabwe Business Directory 2014:Internet; Zimbabwe Stock Exchange 2013:Internet).

6.4 Sampling

In this study, a total sample of 500 organisations was drawn from managers and employees in 250 multinational organisations, 150 major institutional investors and 100 small and medium enterprises within the designated region in Zimbabwe. The study was mainly conducted in the Harare Mashonaland Province of Zimbabwe, where most private and public organisations' headquarters are situated. The sampling method applied in this study was non-probability sampling, by which respondents were selected on the basis of convenience and their accessibility. The type of sampling technique used was convenience and judgmental sampling.

6.5 Data collection methods

■ Secondary data

Secondary data is composed of the existing literature on CC which will form the basis for the conceptual framework, upon which the frame of reference of the study will be built. Text books, journals and the Internet were used to collect secondary data.

■ Primary data

The primary data collection method used in this study was the survey method through the use of a self-administered structured questionnaire.

A total of 500 questionnaires were distributed and 419 usable questionnaires were received from respondents, resulting in a response rate of 83.8%.

6.6 Questionnaire design

A seven-point Likert-type interval scale (1 = strongly disagree and 7 = strongly agree). This study employed an ordinal scale using non-dichotomous data consisting of a spectrum of values by means of a seven-point Likert type scale with opinion-related factual questions for Sections A to E.

A nominal scale was used to assess the biographical data of the respondents. The measuring instrument consisted of six sections:

■ Section A to C related to organisational, external and personal factors impacting CC behaviour (independent variables).

■ Section D, which focused on a mediating variable associated with the perceptions regarding CC behaviour.

■Section E, which focused on dependent variables, related to the impact of CC behaviour on performance outcomes.

■Section F of the questionnaire sought demographic information relating to both the respondents and the sector in which they operate.

Table 2 depicts a brief summary of the sections contained in the measuring instrument.

 

 

6.7 Data analysis

Data was analysed by means of the Statistica computer programme. Data was analysed by means of descriptive statistics (mean and standard deviation) and frequency distributions. Advanced statistics was used to assess validity and reliability and to test for relationships between the variables in the hypothetical model. To conduct a factor analysis, exploratory factor analysis was used. Cronbach's alpha values were calculated to determine internal reliability. Regression analysis and correlation analyses were conducted to test for relationships between the variables.

6.8 Validity and reliability of the measuring instrument

Exploratory factor analysis was conducted to ensure construct validity as to measure convergent and discriminant validity of the measuring instrument. Expert judgement, such as a management researcher, expert in ethics and a statistician and a pilot study was conducted among 30 managers to enhance face and content validity of the questionnaire. To confirm internal reliability of the measuring instrument, Cronbach's alpha values were calculated.

 

7. EMPIRICAL RESULTS

7.1 Demographic profile of the respondents

A summary of all of the demographic information gathered from the 419 usable questionnaires is presented in the tables and paragraphs to follow.

Table 3 summarises the demographic profiles of the respondents in this study and describes the demographic profile of the respondents of this study, according to the nine categorical variables. It shows that 51% of respondents are in senior or middle management positions. The majority were males (55%) between the ages of 31 and 40 (40%). Fifty-five per cent have a bachelors or post-graduate degree with tenure of 11 to 20 years (49%). Thirteen per cent are employed in both the manufacturing and financial sectors and 35% are employed in organisations with 200 or more employees. Thirty-four per cent are employed in organisations that have been in existence for 11 to 20 years and 43% have a turnover in excess of US$2 000 000.

 

 

7.2 Exploratory factor analysis

Table 4 provides the empirical factor structure (influences and outcomes) of the re-specified model and identifies which items were used to define each construct.

 

 

Only loadings greater than 0.5 were considered significant and many items were thus deleted and not considered for further analysis. Following the reliability and validity assessment, five independent variables: organisational social responsibility (OR), personal factors related to personal importance (PF1), personal factors related to personal characteristics (PF2), environmental involvement (EI), market oriented (MO), two intervening variables (corporate citizenship related to strategic planning (CC1), corporate citizenship related to operational planning (CC2) and two dependent variables (organisational sustainability (OS) and organisational performance (OP) remained in the empirical model.

Respondents did not perceive 'corporate citizenship' as a single construct but as a two-dimensional construct. This means that respondents view 'corporate citizenship' as consisting of a dimension related to 'strategic planning' on the one hand and 'corporate citizenship' related to 'operational planning' on the other.

All six items expected to measure 'organisational performance' and all five items expected to measure 'organisational competitiveness' as well as three of the five items (OI1, OI2, OI3) expected to measure 'organisational image' loaded on factor four (4) and were termed 'organisational performance'. All the items that loaded onto factor 5 were deleted due to the lack of sufficient validity for further analysis. Based on these findings, the hypotheses were reformulated and the hypothetical model adapted. The empirical factor structure was then subjected to regression analysis.

7.3 Descriptive statistics

Descriptive statistical results are presented and briefly discussed in Table 5.

 

 

Table 6 highlights the descriptive statistics of each variable that was measured on a seven point Likert scale. In addition, options 5, 6 and 7 on the scale represented an agreed statement which the respondents would choose. Options 1, 2 and 3 represented the level of disagreement and scale 4 indicated neutrality. It appears that for all the variables the mean values cluster around point five (somewhat agree) and six (agree), except for external factors which is neutral. The standard deviation scores are all below point one, indicating not much variability around the mean scores, expect for external factors.

 

 

7.4 Reliability of the measuring instruments

The internal consistency of each of the factors was assessed by calculating Cronbach's alpha and the value >0.8 was considered to represent a sufficient standard of reliability in this study. Table 6 indicates that the Cronbach's alpha values obtained in this study were all above the cut-off point of 0.8 except for the organisational image (OI) and organisational competitiveness (OC) variables which were regarded as inadequate for further analysis and were subsequently deleted from the empirical model.

7.5 Regression analysis

Two sets of regression analyses were conducted and outlined below.

■ The influence of perceptions regarding CC related to strategic planning and operational planning

Table 7 indicates the regression analysis results of the influence of management and employee perceptions on CC related to strategic and operational planning. Table 7 indicates that there is a statistically significant relationship between organisational social responsibility, personal factors measured by personal characteristic dimensions (individual personality, sensitivity and commitment) and market-orientation and corporate citizenship related to strategic planning.

 

 

■ The influence of perceptions regarding corporate citizenship behaviour related to strategic and operational planning on dependent variables (outcomes)

Table 7 also indicates that organisational social responsibility (b = 0.570, p < 0.001) and the personal factors as measured by dimensions of personal characteristics (individual personality, sensitivity and commitment) (b = 0.277, p < 0.001) are positively related to corporate citizenship behaviour related to operational planning.

Table 8 shows the regression analysis results of the influence of perceptions regarding CC behaviour related to strategic and operational planning on the dependent variables (outcomes). Table 8 shows that organisational performance has a strong positive relationship with corporate citizenship behaviour related to strategic planning and operational planning. Table 8 further shows that organisational sustainability has a strong positive relationship with corporate citizenship behaviour related to operational planning.

 

 

7.6 CORRELATION ANALYSIS OF THE HYPOTHESES

Table 9 indicates correlations between the variables of the study.

 

 

Table 9 clearly indicates that there is a strong positive correlation between most of the variables in the matrix. Only a few variables indicated a weak correlation or no correlation.

7.7 FINDINGS ON HYPOTHESISED RELATIONSHIPS

Table 10 shows the findings on the hypothesized relationships of the study.

 

 

8. RECOMMENDATIONS

The empirical results and revised hypothetical model of the study show that there are three influences on perceptions of CC behaviour in Zimbabwe. These influences are categorised as: organisational social responsibility; personal characteristics and market-orientation. The intermediating variable was split into perceptions regarding CC related to strategic planning and operational planning. These perceptions seem to impact on organisational performance and organisational sustainability (outcomes).

Management should inspire employees to participate in CC initiatives and their values should be clearly defined in terms of good CC behaviour. A socially responsible organisation has to be held accountable for its actions regarding the promotion of ethical and moral values in order to implement CC initiatives in the areas in which they operate. Being a responsible organisation could bring changes in the perceptions of CC by looking beyond passive philanthropy.

CC should be seen as a discretionary activity beyond that which is expected of business - it is a choice to put something back into the community, in contrast to organisations which appeal to charity simply for the sake of it. Organisations should go beyond what is mandated by law to make an optimistic impact on the general public and the surroundings. There should be commitment to improve community wellbeing through discretionary organisational practices and contributions of corporate resources. All employees deserve to be treated fairly and respectfully, regardless of gender or ethnic background and should care for the community so as to be socially responsible. It appears that personality could have an influence on one's orientation and commitment to CC. Employees should be willing to accept job assignments and exercise a great deal of effort, beyond what is expected, in order to participate in initiating and implementing CC initiatives

Organisations should adopt a philosophy of societal marketing to enhance the well-being of the society. There should be tolerance towards different cultural groups, build and nurture employee diversity and ensure that steps are taken against all forms of discrimination in the work place. Table 11 indicates some managerial guidelines regarding CC practices.

 

 

Management should ensure that organisations meet the requirements of employment health and safety laws and ethical decision-making procedures should be reflected in a code of ethics. Organisations are expected to be good corporate citizens through philanthropic initiatives, and are expected to contribute financial and human resources to the global community and to give back so that the quality of life may be enhanced and sustained.

There should be total commitment from all in the organisation toward CC behaviour planning strategies and that the vision and mission must be centered on conducting business in a socially responsible manner. Top management must be highly supportive of the CC engagements of organisations. Organisations must have the financial resources as well as human capacity to engage in CC initiatives. Table 12 highlights some general guidelines regarding CC implementation.

 

9. CONCLUSION

The empirical results of this study demonstrated that three independent variables namely, organisational social responsibility, personal characteristics and market orientation influenced management perceptions of CC behaviour in Zimbabwe, which could ultimately impact on organisational performance and sustainability. It is imperative for organisations to consider these perceptions when engaging in CC activities. The findings of the study also offer organisations of all sizes compelling evidence for the establishment of an integrated corporate citizenship strategy as part of their overall organisational plan. This, ultimately, makes it easier for organisations to do business.

 

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This study could assist organisations to strengthen and acknowledge its role in developing society through good CC behaviour and to pressurise the government to play a significant role in developing CC programmes and to inform policy formulation.