IMPACT OF CORPORATE SOCIAL RESPONSIBILITY ON ORGANIZATION PERFORMANCE

International Journal of Advanced Science and Technology Vol. 29, No. 6s, (2020), pp. 2256-2261 IMPACT OF CORPORATE SOCIAL RESPONSIBILITY ON ORGANIZATION PERFORMANCE (With reference to select companies of the IT sector) Dr. VIJAYA LAKSHMI POTHURAJU, M.B.A., M.Com., Ph.D., FDP-IIMA Associate Professor, Department of MBA, CMR College of Engineering & Technology, Hyderabad, Telangana, India. Dr. P ALEKHYA, M.B.A., Ph.D Associate Professor, Department of MBA, CMR College of Engineering & Technology, Telangana Abstract This paper aims to present the organization's performance for socially responsible actions, in Information Technology (IT) sector to contribute to improving the competitiveness of those organizations. The analysis is from different levels of employees working for the organization. It investigates the link among firms ‟relationship with employees with the objective to find out if there is a competitive advantage in applying Corporate Social Responsibilities practices. Besides the direct influence of Corporate Social Responsibility practices on organization performance, quality of work-life has been analyzed. The empirical analysis was constructed on survey data through the Chi-square test. To accomplish this research objective data were collected from a sample of selected IT companies in Hyderabad. Respondents were employees working at different levels in the organizations. The outcome shows that there is a strong connection between corporate Social responsibility practices and organization performance. In addition, the significant relationship in developing Social Responsibilities Practices positively translates, with quality of work life. Keywords: Corporate Social Responsibility, Organization Performance, Quality of work-life, IT sector. 1. INTRODUCTION: Corporate social responsibility (CSR) is basically a concept whereby companies decide voluntarily to contribute to a better society and environment. Corporate social responsibility is represented by the contributions undertaken by companies to society through its business activities and its social investment. Basically, the business motive for CSR is building up positive organization and brand is the great work that yields an aggressive edge while in the meantime adding to different requests that move the association from exclusively concentrating on making benefit to including budgetary, natural and social duty in their center business procedures. CSR is to operate in an economically, socially, and environmentally sustainable environment. This is also to connect the Concept of sustainable development to the company’s level. Regardless of what the expression corporate social obligation recommends, the idea isn't limited to enterprises but instead is planned for most kinds of associations, for example, affiliations, trade guilds, associations that serve the network for logical, instructive, creative, general wellbeing or beneficent purposes, and legislative organizations. 2. CORPORATE SOCIAL RESPONSIBILITY CONCEPTUAL BACKGROUND The Corporate Social Responsibility (CSR) term began to be used since the 1970s and is increasingly popular especially after John Elkington's book on Cannibals with Forks: The Triple Bottom Line in 21st Century Business (1998). It developed three important components of sustainable development, namely economic growth, environmental protection, and social equity, initiated by the World Commission on Environment and Development (Brentford Report (1987). 2256 ISSN: 2005-4238 IJAST Copyright ⓒ 2020 SERSC International Journal of Advanced Science and Technology Vol. 29, No. 6s, (2020), pp. 2256-2261 Elkington encapsulates CSR into 3P focuses on profit, planets, and people. A good company not only pursues economic profit but also concerns the preservation of the environment (planet) and people's welfare, (Global Compact Initiative, 2002). Corporate social responsibility can also be defined as a business commitment to contribute to sustainable economic development, working with employees, employee's families, local communities and overall society (Foxet al, 2002) in Budimanta et al 2004). Therefore, the CSR is directed to an internal and external company. Internal responsibility is directed to shareholders in the form of profitability and growth, to employees by providing compensation in accordance with the fairness principle. The external social responsibility relates to the company role as taxpayers, improving the welfare and competence of the community, and maintaining the environment for the benefit of future generations. 3. REVIEW OF LITERATURE: Al-Malkawi and Javaid (2018) evaluated 107 non-financial firms listed on the Saudi Arabia stock market from 2004 to 2013 with the generalized method of moments (GMM) framework, both fixed effects and random effects models, and pooled OLS. They measured CSR performance with Zakat2 and found there is a strong positive impact of CSR on financial performance, including return on equity (0.0242) and the price-to-book ratio (0.3863). Besides econometric modeling, researchers have also conducted meta-analyses based on existing studies. Wen (2017) analyzed panel data with top firms from 2007 to 2013 in China and found that the positive effects of CSR performance on financial performance are both operational and signaling. Operational effect means when the firm has a better employee relationship and better internal governance, it can generate more profit. The signaling effect means the CSR report can be seen as a self-reported signal, which helps to build a moral reputation for the firm in the job market. Using pooled ordinary least squares (OLS) and fixed effect regression methods, this study evaluated the impact of CSR score (current year and the previous year) on financial performance, including a net profit, total revenue, return on assets, and total operating cost. Madueno et al (2016) defined four categories of stakeholders to be investigated as relationships between the variables and the competitive advantage. The four categories in discussing here are environmental, employees, local community and, customers. In further analyses, the competitive advantages will be investigated by the CSR practices through the indirect or mediating effect of the relationship improvements with the stakeholders. 2257 ISSN: 2005-4238 IJAST Copyright ⓒ 2020 SERSC International Journal of Advanced Science and Technology Vol. 29, No. 6s, (2020), pp. 2256-2261 Abugre (2014) laid a high emphasis on the managerial role in the successful planning and implementation agenda of CSR. The managers can play a major role in planning, organizing, and implementation of the CSR efforts. The public opinion and demand have forced the organizations to take care of society in a better manner (Freeman, 1984). Kim & Kim (2013) who conducted research on CSR and written numerous papers on the subject conducted an investigation on CSR and its impact on the relationship between customers and employees to the overall CSR practice of the firm. These investigations concluded that the firm needs to amend its CSR practice according to the customers’ demands, if the firm is to make profits from this then it should consider this the needs that are affiliated with the customers. According to recent studies performed it was based on deep analysis that firms should now adopt a new theory of CSR and it should start implementing them in the firm in developing nations to be better performing and making more sufficient profits. Blowfield et al (2011), state that owner-managers in SMEs do not possess enough tools to implement responsible corporate strategies. The same authors added that most of the managers or owners of SMEs serve local markets, and they may be heavily engaged in their local communities, and have a particular passion such as education or conservation, but they are likely to be unaware of terms such as corporate responsibility and sustainability. The prevalent overlap between management and ownership makes it easier to align the objectives of both. SMEs’ activities may reflect the values, character, attitudes, educational background and the like of owner/entrepreneur (Vives, 2006). This will have a direct impact on the firm’s corporate responsibility. Lindgreen and Swaen (2010) stated that CSR has now become more practical and has made the businesses to include the society‟s welfare in their business plans. Now, society demands businesses to include their demands in the strategies as they are important business stakeholders. Now, business firms are forced to consider the stakeholders‟ concerns while developing their business plans. 4. STATEMENT OF THE PROBLEM CSR is a new initiative by corporate organizations for serving society to cope up with uncertain challenges. However social responsibility is essential for organizations in a country like India. This is also applicable to the IT sector as a Multinational firm. To perform better than other companies all the organizations are engaging themselves in socially responsible activities. Analyzing IT firms, the researcher by studying the previous work done in the area of CSR and interpret it is a part of the literature as well, having described CSR in an astonishing path, considered conflicting conclusions. 5. OBJECTIVES OF THE STUDY:  To evaluate the relation between the performance attributes among the technical and nontechnical positions on CSR  To examine the impact of CSR on the work-life quality.  To analyze the variances of opinions towards CSR practices among the respondents. 6. HYPOTHESIS OF PRESENT STUDY  CSR practices have a significant impact on organizational performance.  CSR practices have a significant impact on work-life quality. 7. METHODOLOGY OF STUDY This is exploratory research with the use of quantitative data. The present research paper uses a survey to collect data from a sample of 200 respondents from IT companies located in the Hyderabad, Telangana. Inferential statistics and associated statistical instruments and tools were used to explain the results. The instrument used is an online questionnaire containing several constructs. The main constructs 2258 ISSN: 2005-4238 IJAST Copyright ⓒ 2020 SERSC International Journal of Advanced Science and Technology Vol. 29, No. 6s, (2020), pp. 2256-2261 are the Likert scale; it is in line with research published in key articles. Finally, using the Internet has significant advantages, especially; the populations we wish to interview are geographically dispersed. 8. RESULTS AND DISCUSSION: Improve overall work-life quality. Non-Technical Technical Total Crosstab Improve overall work-life quality. UN Agree Strongly Agree Count 0 46 42 % of Total 0.0% 20.4% 18.6% Count 2 34 76 Total 88 38.9% 112 % of Total Count % of Total 61.1% 200 100.0% 0.9% 2 0.9% 26.5% 80 46.9% 33.6% 118 52.2% Chi-Square Tests Asymptotic Significance (2- sided) Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association Value 1.358a 1.705 .346 N of Valid Cases 200 Df 2 2 1 .000 .426 .556 a. 2 cells (33.3%) have expected count less than 5. The minimum expected count is .39. INTERPRETATION: - From the above analysis table it depicted that P<0.05 i.e., we reject the H0 and conclude that there is a relationship between levels of management(Technical & Non-Technical) factor and overall work-life quality. We conclude saying that there is a positive performance impact of CSR practices among different levels of employees working in technical and non-technical positions with their Quality of work-life. Formulate healthy HR practices Crosstab Formulate healthy HR practices (recruitment, continuous learning and training, appraisal and reward system ) UN Agree Strongly Agree NonTechnical Total Count 12 50 26 88 % of Total 6% 25% 13% 44% Count 12 70 30 112 % of Total 6% 36.5% 17.5% 56% Count 24 120 39 200 Technical Total 2259 ISSN: 2005-4238 IJAST Copyright ⓒ 2020 SERSC International Journal of Advanced Science and Technology Vol. 29, No. 6s, (2020), pp. 2256-2261 % of Total 12% 61.5% 30.5% 100.0% Chi-Square Tests Value Pearson Chi-Square Likelihood Ratio Linear-by-Linear Association N of Valid Cases Asymptotic Significance (2-sided) Df 4.087a 2 .030 4.032 2 .133 3.449 1 .063 200 a. 1 cells (16.7%) have expected count less than 5. The minimum expected count is 3.50. INTERPRETATION:- From the above analysis table it depicted that P<0.05 means we reject the H0 and conclude that there is a relationship between the variable factor and Formulate healthy HR practices. 9. LIMITATIONS OF STUDY The findings and conclusions from this study are subject to some limitations. The model proposed here is focused on the IT Sector. Variables were carefully selected for the specific characteristics of these companies. The company’s approach towards CSR is highly conditioned by the attitudes and values of the management. The model could be improved by including dependent variables that have been shown to affect firm performance as reputation and organizational culture. Another improvement could be the approach implemented in Hernandez et al (2017) where the mediating variables were innovation and administration included. 10. RECOMMENDATIONS OF THE STUDY Corporate Citizenship is a volunteer demonstration taken up by the organization that should yield advantages to the outside just as the inward condition of the association. In the event that we take the outside demonstrations of the organization, they do utilize reused items, ranch, water preservation, which are different acts that are helpful to the earth. From the reactions gathered we can deduce that however, the workers can react to the individual proclamations firmly they are not giving a solid reactions when received some information about its effect from which we can say that the representatives are being unmindful of the organization's certain effect on the nature and ought to be educated about it every once in a while as they are a piece of the hierarchical family. However Charitable activities being continued once in a while, appear to effective representatives on the grounds that, from the data accumulated, the workers are taken as a colossal piece of this movement and their cooperation in it helped them outline their recognition. CSR practice was an immense thing in view of the statutory compliances that the organizations needed to pursue. In any case, aside from that consistency, there are not many implied acts that go under the CSR practice. What's more, according to the study we could see a solid reaction from representatives during research some information about work fulfillment, support of good workplace and generally speaking work-life quality yet there was a little confusion and maintenance of ability. 11. CONCLUSION 2260 ISSN: 2005-4238 IJAST Copyright ⓒ 2020 SERSC International Journal of Advanced Science and Technology Vol. 29, No. 6s, (2020), pp. 2256-2261 In conclusion, this study challenges researchers and managers to move toward more sophisticated assessments concerning how and why employee perceptions affect perceived corporate performance and employee attachment toward the company. With additional work building on this study and by incorporating additional important variables, future research may well achieve a more comprehensive account of CSR activities' effectiveness and efficiency. REFERENCE 1. 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The InternationalJournal of Human Resource Management, 18, 1701-1719. 2261 ISSN: 2005-4238 IJAST Copyright ⓒ 2020 SERSC