Sborník příspěvků XVII. mezinárodní kolokvium o regionálních vědách Hustopeče 18.–20. 6. 2014
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DOI: 10.5817/CZ.MUNI.P210-6840-2014-97
CORPORATE SOCIAL RESPONSIBILITY AS A TOOL FOR
SUSTAINABLE REGIONAL DEVELOPMENT:
A CASE STUDY IN MORAVIAN-SILESIAN AND ZLÍN
REGION
SPOLEČENSKÁ ODPOVĚDNOST PODNIKÁNÍ JAKO NÁSTROJ PRO
DLOUHODOBÝ REGIONÁLNÍ ROZVOJ: PŘÍPADOVÁ STUDIE
V MORAVSKOSLEZSKÉM A ZLÍNSKÉM KRAJI
ING. PAVEL ADÁMEK, PH.D.
Katedra managementu a podnikání
Obchodně podnikatelská fakulta v Karviné
Slezská univerzita v Opavě
Department of Mangement and Business
School of Business Administration in Karviná
Silesian University in Opava
* Univerzitní náměstí 1934/3, 733 40 Karviná, Czech Republic
E-mail: adamek@opf.slu.cz
Annotation
The purpose of a paper is analysing Corporate Social Responsibility (CSR) as a tool for sustainable
economic and social development and reviewing CSR practise of the companies in the MoravianSilesian
and Zlín Region. In our empirical research (146 Moravian-Silesian and 83 Zlín SMEs had
been surveyed) we explored the commitment, the motivations and barriers of social and environmental
activities in two regions, and we also consider the concept as a strategic tool for sustainable regional
development. Conclusions of this paper indicate a possible future development of CSR and uncovered
a summary of CSR impacts. Paper is contribution to the debate for recognition of the particular role
of CSR as a tool for strengthening regional competitiveness.
Key words
corporate social responsibility, regional development, small and medium-sized enterprises
Anotace
Cílem příspěvku je analyzovat společenskou odpovědnost podnikání (CSR) jako nástroje pro
udržitelný economický a sociální rozvoj a také pro přezkoumání CSR a jeho aplikovatelnost ve
společnostech v Moravskoslezském a Zlínském kraji. V našem empricickém výzkumu (146
moravskoslezských a 83 zlínských malých a středních podniků) jsme zkoumali závazek, motivaci a
překážky sociálních a ekologických aktivit ve dvou regionech. Koncept CSR je představen jako
strategický nástroj pro udržitelný regionální rozvoj. Závěry příspěvku ukazují na budoucí vývoj
společenské odpovědnosti podnikání a odhalují konkrétní možnosti v dalším využití CSR mezi malými
a středními podniky. Příspěvek přispívá k poznání role CSR jako nástroje pro posílení regionální
konkurenceschopnosti.
Klíčová slova
společenská odpovědnost podnikání, regionální rozvoj, malé a střední podniky
JEL classification: M14, R11
Introduction
Socially sensitive corporate activity entails a voluntary commitment to the public good demonstrated
during the deployment of business resources in corporate or entrepreneurial business practice.
Sborník příspěvků XVII. mezinárodní kolokvium o regionálních vědách Hustopeče 18.–20. 6. 2014
750
Corporate Social Responsibility (CSR) not simply means a mere following of certain set of rules and
criteria, but refers to such business conduct, which provides benefits and advantages for the
employees, for the immediate and macro environment, including the natural surroundings, thereby
promoting overall well-being. This, however, cannot be restricted to financial support, as the concept
of well-being is not exclusively measured in monetary terms demonstrated by the elaboration of such
novel indicators as the ecological foot print, the human developmental index, and the complex
environmental indicators (Szlávik and Csáfor, 2012).
The Corporate Social Responsibility (CSR) movement is rapidly growing in signification as a
strategic management instrument over the past number of years. Not only has the issue received
academic attention but has quickly moved up the corporate agenda (Knox et al., 2005; Ogrizek, 2002).
However, there has been a lack of attention to, and discussion of, CSR in the Czech Republic.
Research with regard to SMEs has also been quite scant (Friedman and Miles, 2001; Jenkins, 2005)
SMEs have been identified as an important strategic sector for promoting growth and social
development (Munasinghe and Malkumari, 2012). The considerable emphasis placed nowadays on the
societal role of business is in accordance with the spreading belief that measures of company success
must go beyond profit and should also relate to the needs of stakeholders and society at large (Natale
and Sora). According to Carroll (2000) CSR is becoming the defining business issue of our time,
affecting corporate profits and credibility, as well as personal security and sustainability of the global
economy.
The reason for rise of this article is identified CSR as a significant opportunity for regional
development: an opportunity for SMEs, for their stakeholders and for society at large, because SMEs
are a fundamental part of the growth and jobs equation. By Zumbasen (2011) it is necessary to take
into account the developmental stage companies in a given economic environment with emphasis its
size (for example small, medium or micro firms), to serve our dividing companies in the SME sector
under the EU methodology.
1. CSR in a nutshell
The history of CSR is strongly intertwined with the emergence over the past forty years of the
environment as a worldwide concern and the eventual transformation of the term into “sustainable
development” which incorporates social issues alongside environmental and development ones. This
is because sustainable development has been translated into a managerial approach - CSR which
integrates the businesses’ financial performance with their externalities for human development and
the environment (Nilsson et al., 2008; Carrol and Bucholtz, 1999; EU Commission, 2006; 2008;
Henningsson, 2008). According to WBCSD - CSR and sustainable development CSR is an integral
part of sustainable development. For an individual company, this means the integration of social
(including human rights), environmental and economic concerns into that company’s values and
culture. These values are then incorporated into the way in which the company goes about its business
and are reflected in that company’s policies and strategies, decision-making, and operations
CSR is one of the tools which can help European countries to develop their competitiveness and to
develop a dynamic knowledge based economy (Szlávik and Csáfor, 2012).). In relation to SMEs, a
variety of definitions have been proposed which focus on issues such as number of employees
working in the enterprise, annual turnover, ownership types, and formal versus informal economy
status (Jamali et al., 2009). For research purpose was used definition of SME according to the EU.
Study by Caroli suggests that SME can successfully implement CSR policies and this directly affect
their competitiveness (Munasinghe and Malkumari, 2012). SMEs have a similar (Jenkins, 2005) and
stronger (Perini, 2006) stakeholder relationship in comparison to large companies. That means SMEs
have stakeholders in the common range with large companies and the purpose of stakeholder
management is similar, namely to reduce the risk by managing stakeholders (Jenkins, 2005) and
SMEs are used to be very close to their stakeholders like community and employees (Perini, 2006).
Additionally, SMEs plays a significant role in the local community with a high-degree of interreaction
and acting as benefactor by support to the local economy by creating job opportunities
Sborník příspěvků XVII. mezinárodní kolokvium o regionálních vědách Hustopeče 18.–20. 6. 2014
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(Munasinghe and Malkumari, 2012). It has been argued that SMEs are constrained by the time and
financial resources (Sarbutts, 2003; Vives, 2006). On the other hand, it has been argued that being
smaller and flatter, SMEs may be better placed than large firms to take advantage of the changing
needs of society (Perez-Sanchez, 2003).
Above mentioned facts were determined as the basis for the research in SMEs. We deliberately
concern on SMEs because there is a higher assumption of local impact, in the concrete that most of
these companies operate mainly in the region or in „place“ of business. The empirical research effort
has completed in 2012 and focused on the firms and enterprises in Moravian-Silesian and Zlín Region.
2. CSR background
In condition of the Czech Republic (CR) at the beginning was the impulse of most companies
involved to focus purely on philanthropic donations. Over the time, a number of companies have
steadily been growing and companies are engaged in a remarkable range of activities. Today, Business
Leaders´ Forum’s mission is promotion and enforcement of CSR in line with European methodology
and best standards. The harmonization of Czech law with EU legislation, and the Czech Republic's
accession to the European Union, contributed to major advances in the promotion of CSR. As long
ago as 1998 the Czech Republic adopted, among other things, rules for the introduction of EcoManagement
and Audit Scheme (EMAS), and prepared the first National EMAS Program.
The milestone in building foundations of CSR was August 2003, when the Sustainable Development
Council of the Czech Government (SDCG) was established as a standing advisory body of the
Government for sustainable development and strategic management. Increasing interest in CSR and a
trend in implementation of CSR reflect also surveys of the Business Leaders´ Forum. CSR awareness
has also been increasing thanks to international corporations operating in the country as they belong
among main supporters of CSR and have brought essential know-how. As CSR gaining its popularity
among entrepreneurs, some non-governmental organizations have been focusing on building
partnership between profit and non-profit organizations in the area of corporate philanthropy,
corporate volunteerism, social marketing, environmental protection and others (e.g. HESTIA, AISIS,
Czech Donors Forum, Environmental Law Service, Business Leaders´ Forum, etc.). In March 2007
the Ministry of Labour and Social Affairs created a new website on CSR, to inform users about the
concept of CSR in the European Union. The website also provides references to different projects and
activities concerning the promotion of CSR (Czech Ministry of Labour and Social Affairs, 2012).
According to surveys in the business sector, it appears that the main CSR related priorities are the
environment, well-being and philanthropy. In each field is the most important to get into public
awareness while the SMEs should implement this approach and gaining the competitive advantage in
the futures market. Awareness is widespread, but information is lacking as to specific CSR topics.
Many CSR-related activities are of common public knowledge but they are understood as concepts in
and of themselves and not within the CSR context. However, the broader concept of CSR is slowly
taking root in educational institutions such as universities. It is often covered in courses on Corporate
Governance, Business ethics and in some cases it exists as a separate course as well. From
environment part of situation in CR are related - National action plan - the current policy on climate
change is in the process of modification. Environmental awareness is largely promoted through the
Czech Republic’s National Cleaner Production Program. In addition, there are a number of
educational programs that reach out to the younger generations, introducing them to important
personal practices such as sorting waste.
From the cooperation between local communities and businesses there we found that the business
community involvement is generally not innovative. While normative projects and activities are
carried out, ongoing dialogue and cooperation between businesses and communities is not common.
Sustainable Products and Services are included into the Czech Republic’s National Trademark on
Quality is given to products that meet certain standards regarding quality/sustainability. The program
consists of approximately 20 trademarks, including several that focus solely on environmental impact
Sborník příspěvků XVII. mezinárodní kolokvium o regionálních vědách Hustopeče 18.–20. 6. 2014
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of the product. It was mentioned that company best practices is implemented into the Business
Leaders’ Forum. Currently, has collected and disseminated practical CSR tools and guidelines via its
web portal.
3. The conceptual framework of the research
The target to be examined was selected by a systematic sample taking process. The research task is
focused on analysing the commitment, the motivations and barriers of social and environmental
activities in two regions. Research was conducted during 2012. The research was based on the
scheduled progress of the research, selection and identification of respondents, data processing and
analysis. Primary research finds opinions entrepreneurs in the micro, small and medium enterprises in
connection with the use of socially responsible activities in the Moravian-Silesian and Zlín region. To
obtain information, the SMEs in the total number of 2000 firms and the total return was 12% (240
questionnaires). Of these, the control was excluded 11 questionnaires that were not properly
completed and included in the survey was 229 completed questionnaires. Representation of companies
that meet the criteria for allocating the relevant groups are in absolute numbers, was represented by
104 micro (45%), 73 small (32%) and 52 medium-sized (23%) enterprises, in particular the number of
146 companies in Moravian-Silesian Region and 83 companies in Zlín Region. The empirical research
analyses are aimed at the identification of following components (as a part of extensive research): the
commitment of the region, the motivational and limiting factors of responsible business activity and
firm´s expectations for the support of CSR development efforts.
4. The main findings of research
Firstly, we measure the importance of SMEs and to behave responsibly towards the environment area,
employees and the community in which the company operates. For the interpretation of the output was
used an approach that took into account both frequency response and attributed to the weight (range 1-
10 is maximum value). It is obvious that micro, small and medium enterprises attach importance to a
very similar socially responsible behaviour to the community. Values is dominated by a numerical
expression 8, which expresses the arithmetic mean of the number of weights and responses.
Awareness of companies within the extent of approaches is quite surprising. The results suggest that
firms have will to be responsible to the environment, employees and community.
Tab. 1: Level of importance of SMEs responsibly towards the environment, employees and the
community in which the company operates
Type of enterprises Points
Micro 8,10
Small 7,92
Medium-sized 8,27
Total 8,08
Source: own research
From terms of territorial effect of SMEs, there is a significant position of companies that mainly
operate only in the region (Chart 1), it is clear that the international presence is most important for
medium-sized and small companies compared to micro-enterprise for which is more distinctive local
or regional action. We can observe that the significance of the local influence is dependent on the size
of the company. According to the given results it is clear that micro and small firms are major players
on the local (regional) market and thus have a direct impact on regional development. This finding is
crucial for the importance of SMEs in regional development.
Sborník příspěvků XVII. mezinárodní kolokvium o regionálních vědách Hustopeče 18.–20. 6. 2014
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Fig. 1: Territorial effect of SMEs
Source: own research
The factors of motivation for implementation (Chart 2) of CSR were researched by a frequency of
responses and their arithmetic average (min. 0, max. 5). It has been determined that the most
motivating factor is improving the company´s image. Minimum values were identified as the factors:
tradition (2,8), improving relations with the public administration (2,8) or pressure from business
environment (2,8).
Fig. 2: The motivation factors for implementing CSR
Source: own research
On the contrary, the main motivating factors are identified in order: 1. „improve the company's
image“, the significance 3,830; 2. „improve customer loyalty“ 3,703; 3. „efforts to attract and retain
quality employees 3,686; 4. „increase economic efficiency“ 3,668; 5. „increase employee satisfaction“
3,659. These factors may be found as the dominant motivational incentives for the use of socially
responsible approaches companies.
24%
10% 8% 16%
33%
45%
25%
35%
22%
8%
23%
18%
21%
37% 44%
31%
0%
20%
40%
60%
80%
100%
120%
micro small medium-sized total
international
in the Czech Republic
in region
firm domicile
3.4
2.7
2.8 3.7
3.6
3.7
3.7
3.8
3.7
3.6
3.0
2.8
3.0
3.2
2.0
3.0
4.0
ethical-moral reasons
tradition
improve relations with the
public administration
improve customer loyalty
improve relations with
business partners
increase employee
satisfaction
efforts to attract and retain
quality employees
improve the company's
image
increase economic
efficiency
improve the competitive
position
implementation of the Code
of Ethics
pressure from outside
use of public incentives
improve PR
Total SMEs
Sborník příspěvků XVII. mezinárodní kolokvium o regionálních vědách Hustopeče 18.–20. 6. 2014
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Fig. 3: The limiting factors for higher exploitation of CSR
Source: own research
To identify limiting factors was selected 10 potential barriers and examined the degree of significance
based on the arithmetic average based on the calculation of response rates and associated weights 1 to
5 (5 presents most significant value). For a partial description of the final results of the findings will
be presented in each category separately by individual surveyed SMEs. As a first result values are
given for micro-enterprises. Results findings suggest factors such as the lack of recognition for the use
of CSR activities and lack of capital. Micro-businesses do not feel the pressure that was exerted on
them at a higher involvement of CSR activities. In fourth place was the lack of support from the state
and fifth place went factor that expresses incorporate these activities into core business objectives.
Seventh place goes to "increased costs", here we have assumed that this factor for micro-enterprises
will be given a higher significance. Reluctance management is a major obstacle to including
statements that socially responsible activities provide no benefit to the business. Necessary knowledge
and skills also not a major barrier in the use of approaches.
Small businesses see as the biggest obstacle to a lack of capital for the use of socially responsible
activities. In second place was the barrier "incompetence staff" possibly managers who would be
focused on the area of CSR. As the problem appears to be in third place „the lack of" recognition from
the outside" it means that the small businesses are not motivated to higher level of developmental
activity due to public pressure. The last two places are placed obstacles in the form of resistance of
management, which means that this fact is not privileged barrier including the statement that CSR
activities do not bring any benefit to the business. These values are identical to those of micro
enterprises. The question of the cost increase to fourth place and thus constitutes an important aspect
in the issue of selected barriers. For the sample of medium-sized companies is considered the most
significant barrier is the lack of support from the state. In second place was the view that CSR
activities lead to increased costs. The claim that CSR activities are not the main business objectives
placed eighth place and the lack of capital for the implementation of CSR activities took ninth place
out of 11 selected factors. The values obtained are significantly different in contrast to the previous
two categories of SMEs, but the last two factors barriers ended up in the same place, these are factors
that CSR does not bring any benefit to the business and management of indignation to the use of CSR.
The presented results demonstrate the partial results of extensive research in the use of selected
activities of CSR in SMEs in Moravian-Silesian and Zlín Region. The results showed that SMEs have
allowance for socially responsible business, but in practice terms there is an area for improving. Based
on the results was confirmed that this sector, namely micro and small companies operate mainly
locally (domicile of firms) or in the region, and thus have a direct interaction with their
competitiveness in these areas. SMEs affect their stakeholders and if "more" to use activities and tasks
2.00
2.50
3.00
3.50
4.00
CSR activities do not
provide benefits for
business
CSR lead to increased
costs
CSR activities are not he
primary business
objectives and interests
CSR - nothing obliges us
we do not have time for
CSR
absence of skilled people
for CSR
lack of skills and
knowledge
companies management
are not inclined to CSR
inadequate state support
absence of recognition
from the environment
lack of capital
micro
small
medium-sized
Sborník příspěvků XVII. mezinárodní kolokvium o regionálních vědách Hustopeče 18.–20. 6. 2014
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included in the concept of CSR could be created expectations for sustainable development in terms of
regional performance.
Conclusion
SMEs in Moravian-Silesian and Zlín Region are already implementing CSR activities (sometimes
even for decades) but are, in general, not aware on that. Especially the smallest companies are not
familiar with the concept. Consequently, they are often sceptical towards the concept as such and do
not see the benefits they may derive from an investment in CSR. Nevertheless, SMEs are in general
aware of their social responsibility and in most of the cases not at least reluctant to fulfil it. Either due
to intrinsic motivation (i.e. the ethical/moral standards of behaving correctly) or because of extrinsic
pressures (i.e. stakeholder expectations) SMEs become knowingly or unconsciously involved in CSR
and, consequently, benefit from the positive impact on the enterprise’s competitiveness that can be
derived thereof.
From Czech perspective is more important to know that companies (especially SMEs) need help with
implementing CSR approach according different models, because there is no one approaches for
everyone. The awareness raising and the availability of best practices (from all types of companies)
should be important for SMEs. But, on the other hand, we can see an increasing demand and need
from SMEs for concrete tools, very concrete instruments and solutions to tackle the challenges of
sustainable regional development. From the performed research we should summarize: 1. SMEs are
interested in CSR, even if they are struggling for survival (e.g. financial problems, increased
competition, economic situation); 2. Finding good practices in SMEs in one thing, convince them to
participate in a project is another thing (due to their difficult economic situation); 3. Most SMEs are
doing “some” CSR, often linked with personal values of the entrepreneur, the approach in SMEs is an
individual one; 4. Awareness among SMEs has increased (due to projects and initiatives); 5. Does not
exist the real strategy for CSR (only best practices); 6. Entrepreneurs need the expert´s support to
formulate (implement) CSR strategy; 7. Widening of CSR has to be continued – focused on the
stakeholders; 8. No need for any standardization, important is voluntary principle; 9. SMEs are silent
diversity stakeholders and they are socially responsible actors deeply embedded in the local
community.
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This paper was supported by the project "Innovation of Educational Programs at Silesian
University, School of Business Administration in Karviná" n. CZ.1.07/2.2.00/28.0017.