The effect of Corporate Social Responsibility on the
competitiveness of firms in the Mobile
Telecommunication industry in Ghana
Emmanuel Selase Asamoah1
ABSTRACT
The study examined the effect of Corporate Social Responsibility (CSR) practices in achieving
competitive advantage in the Mobile Telecommunication Industry in Ghana. Specifically, the
study determined the extent of implementation of CSR policies by the Mobile
Telecommunication companies, ascertained the factors influencing the companies to engage in
CSR, examined the perceived influence of the practice of CSR in achieving competitive
advantage among the companies, and identified the main challenges facing the Telecom
companies in the implementation of CSR. The study used quantitative methodology to achieve
its purpose. A survey questionnaire was used to gather data for the study. Overall 360
employees were selected from all the 6 Mobile Telecommunication companies operating in
Ghana. The companies selected included GLO, AIRTEL, VODAFONE, MTN, EXPRESO and
TIGO. Only senior managers of the various firms were sampled for the study. Both descriptive
and inferential statistical tools were used in the data analysis. The study found that the
performance of the companies CSR practices was high in the areas of community support,
environmental issues, and ethics. The companies engaged in CSR for various reason including
enhancing the reputation of the company’s, for positive image and branding of the company,
to gain some competitive advantages, to improve business performance etc. The companies
gained to moderated extent competitive advantage by engaging in CSR, VODAFONE gained
higher competitive advantage than all the mobile telecommunication companies. A positive
feeling complacency was the main challenge of the companies in undertaking their CSR
initiatives and practices. The study recommends that shareholders should increase their
commitment level to the practice of CSR as such practice was found to have effect in achieving
competitive advantage.
Keywords: Corporate Social Responsibility, competitiveness, mobile telecommunication
JEL Classification: M00, M1, M3
Introduction
The competition for customers among telecommunication firms in Ghana is fierce. The
competition among the various firms is not only limited to new customers but also to keep
existing customers. In this fiercely competitive environment, existing customers are frequently
exposed to offers and counter offers from the competing firms. At the same time various
persuasive messages are being made to encourage customers to switch their service provider.
Perhaps the Corporate Social Responsibility (CSR) of a firm could provide certain competitive
1
Affiliation: Ing. Emmanuel Selase Asamoah, PhD, Lecturer, University of Professional Studies, Accra,
Department of Business Administration. P. O. Box LG 149, Accra, Ghana. Email:
[email protected]
edge which could ensure the growth and survival of a firm into the future. In support of this
view, Dolnicar (2007) notes that consumers purchase decisions are positively influenced by
socially responsible initiatives. However, the CSR initiatives will have to be diligently
executed in order to ensure the continuous existence of companies. Although it is widely
recognized that CSR is of growing concern in the current globalized economy, there is no sign
of consensus on its definition, rules, structures or procedures (Amposah-Tawiah & DarteyBaah, 2011). Guerra (2002) sees it as not more than sound business practice. Lunheim (2003)
suggests it as just a forum for the “business – society” interface. Wheeler et al., (2003) also
sees it as a broader stakeholder consideration in business operations.
There is substantial agreement that CSR is concerned with societal obligations, although
the nature and scope of these obligations remains uncertain (Smith, 2003). Smith, (2003)
argues that companies should only be responsible to company stakeholders, while other authors
argue that companies should be responsible to society as a whole (Brown and Dacin, 1997;
Kotler and Lee, 2005). Sen et al. (2001) opined that the benefits of CSR for companies which
includes increased profits, customer loyalty, trust, positive brand attitude and combating
negative publicity, are well-documented. Galbreath (2006) explored how CSR can be
effectively built into firm strategy. The Galbreath (2008) observed that in crafting its strategy,
strategic managers must endeavor to build. Galbreath (2006) identified six key areas of
strategy, namely, the firm‘s mission, strategic issues, markets, customer needs, resources, and
competitive advantage. Just as the global economy and market is experiencing intense
competition, and high customer demands for better services, so is the mobile telecom industry
in Ghana. Major competing mobile telecom providers in Ghana include MTN, TIGO, Airtel,
VODAFONE, EXPRESSO and GLO. Together, these telecom service providers provide
traditional telecommunications, IP services, Wireless service, Mobile markets and
technologies, broadband markets and technologies. They also provide mobile services with an
increasing number of value added services such as Short Message Service (SMS), Wireless
Application Protocol, Subscription services, General Packet Radio Services, and Third
Generation services.
Statement of Problem
According to Ashley (2002), as a source of competitive advantage, CSR is exactly what
companies require in order to improve their competitiveness. However, regarding the impact
of CSR on competitive advantage, the results have been mixed. Researchers have found that
CSR leads to competitive advantage. For example, there has been a surge in CSR activities in
the telecommunication industry in Ghana in recent years, however, these activities appear to
have been mere strategic and marketing tool for gaining competitive edge rather than purely
ethical and philanthropic motives (Amposah-Tawiah & Dartey-Baah, 2011). In the view of
Walton, (2010), the most commonly identified corporate advantages include maintaining and
improving reputation or brand image, government relations, brand differentiation, customer
loyalty and employee recruitment and retention. Also, Waddock and Graves (1997) found
positive relationship between a firm's social performance and its financial performance.
Orlitzky et al. (2008) also claimed that there is strong empirical evidence supporting the
existence of a positive link between social and financial performance. However, Wright and
Ferris (1997) found a negative relationship between CSR and firm performance.
The link between CSR and competitive advantage is often viewed as promising if social
needs, environmental limits and corporate interests are well coordinated within it. It provides
a mutual value for the company and the society (Porter and Kramer 2006). If responsibility
were proved to be cost-effective, more firms might be pressurized into applying it in practice.
CSR and competitiveness are linked through three management processes: strategy,
stakeholder and responsibility. In other words, adoption of CSR strategy directly affects
competitiveness because the latter enhances the sustainable development of a corporate vision
through a corporate strategy, expands the understanding of CSR complex surrounding and
improves the relationship with the main stakeholders through stakeholder management. It also
expands the transparency of organization through responsibilities for managing processes.
Furthermore, on the relationship between CSR and competitiveness, Jones (1995)
concluded that the companies involved in repeated transactions with stakeholders based on
trust and cooperation, motivated to be honest, reliable and ethical because they yield high for
such behaviour. Hillman and Keim (2001) identify the activities of CSR as a corporate form of
differentiation that generates competitive advantage, for example in the provision of
investment capital. In a study of stock prices of companies from 1995 to 2003.it has been noted
the evidence of a link between CSR and competitiveness (Smith (2003) points out, that
reputation contributes to a sustainable competitive advantage because the reputation of socially
responsible companies has a significant positive impact on the value of the shares. Strategic
CSR can be observed in three areas: the creation of value, Resource-Based View (RBV) and
competitive advantage. Based on this conflicting findings, this study seeks to verify the effect
of CSR on competitive advantage of firms in the Telecommunication industry in Ghana.
Objectives of the Study
The main aim of the study is to examine the effect of CSR on the compatitiveness of
companies in the Mobile Telecommunication industry in Ghana. The specific objectives are:




To determine the extent of implementation of CSR strategies by Mobile
Telecommunication companies in Ghana.
To ascertain the factors influencing the companies to engage in CSR to engage in CSR
To examine the perceived influence of the practice of CSR in achieving competitive
advantage among the companies
To identify the main challenges facing the Mobile Telecommunication companies in
the implementation of CSR
CSR and competitiveness of firms
According to Porter and Kramer (2006) there is a link between CSR and competitive
advantage. The link that is made by these authors is difficult and does not give a clear insight
in how CSR affects competitive advantage. They mention that CSR and competitive
advantages are linked, but they do not mention in what way. Jonker and Roome (2005) state in
their article that CSR can provide firms with a unique chance for competitive advantage.
Branco and Rodrigues (2006) argue that firms engage in CSR because they think that it might
give them some kind of competitive advantage. Business cannot be seen separately from the
society in which the firms exist and operate. Lately, as firms integrate CSR voluntarily in their
operations, it is interesting to understand the motivation of the firms to engage in CSR
activities, or so called social responsibility activities. Of course there are some drivers behind
the emergence of CSR in firms operations, such as expectations of stakeholders, but CSR also
has to yield some financial performance for firms. Porter and Kramer (2006) explains that CSR
allows firms to increase financial performance. Therefore managers must treat CSR as they
treat all of their investment decisions (McWilliams & Siegel, 2001).
According to Branco and Rodrigues (2006, p. 112) “there are two contrasting cases for
CSR”. They suggest that there is a normative case, which suggest that a firm should behave in
a social responsible manner, because it is ethically correct to do so. The second case is the
business case. “The business case can be presented by asking how companies view the
possibility of furthering their economic success by paying attention to social responsibility”
(Branco & Rodrigues, 2006, p. 112). CSR involves some costs that need to be made and these
costs are usually short-term and the benefits of these activities are often long-term (Branco &
Rodrigues, 2006). CSR does not immediately yield financial profit for every firm and thus
firms often do not know if CSR leads to competitive advantage. A comprehensive literature
review has shown that various publications examine the competitive advantage of CSR on a
corporate level (Lankoski, 2008; Smith, 2007). The so-called “business case for CSR” analyses
CSR on the corporate level and discusses added value companies might gain through
responsible behaviour (Garriga & Mele, 2004). According to this concept, companies view the
possibility of furthering their economic success (Branco & Rodrigues, 2006). For instance
through added shareholder value, reputation and image gains, increased customer loyalty and
trust, enhanced market share, staff motivation and retention as well as increased share prices
(Beckmann et al., 2006). Additionally, the business case perceives CSR engagement as a source
of opportunity, innovation and competitive advantage (Porter & Kramer 2006) as a focus on
societal issues and interaction with external Stakeholders leads to the development of new
products, services and business Models.
Competitive differentiation is among the core drivers of responsible competitiveness at the
company level. Companies need to align CSR with their operations in a way that allows them
to operate in a cost-efficient and competitive manner in order to secure their position in the
face of augmented global competition. Positive impact of CSR seems to be particularly evident
with regards to human resources, risk and reputation management and innovation. When
analyzing responsible competitiveness on a sector level, CSR no longer acts as the key driver
for of competitive advantage of a single company, but of a whole industry sector. Gains in
innovation, image and reputation and in performance come about for a sector as a whole, and,
as a result it might improve competitiveness of those sectors, that compete with other, different
sectors. Moreover, it might as well affect the competition between sectors of the same kind,
but which are operating in different countries or regions.
Extensive research over the last 30 years on the effect of firm social actions on business
performance have shown both a positive and negative correlation between CSR and firm
financial performance, and in some cases mixed results (Margolis & Walsh, 2003). Pava and
Krausz (1996) examined 21 studies of corporate social performance and business performance
between 1972 and 1992, finding that 12 demonstrated a positive association, eight showed no
association, and only one study indicated a negative correlation. The results of these
examinations indicate uncertainty in predicting purely positive CSR and business performance
correlations. Pava and Krausz (1996) summed the findings well by stating that while not all
studies prove high-CSR firms perform better, there is evidence that such firms perform at least
as well as lower-CSR firms.
According to Ullman (1985), financial profitability and Social responsibility are positively
related - profitable firms are better social performers. A firm’s economic performance affects
its capability to undertake programs to meet social demands. Thus firms need excess resources
to be good social performers because social performance involves substantial costs, and only
firms with these resources are capable of absorbing these costs. Marcus (1993) found a positive
effect of CSR on Corporate performance citing that firms that have a good effect on society are
also highly profitable. According to this perspective, good social responsibility contributes to
profitability i.e. it pays to be good. Alexander and Buchholz, (1978) state that socially aware
and concerned management may possess the skills needed to run a superior company in the
traditional finance sense. These skills may be sensitivity to outside forces and creative
adjustments to external pressures. Similarly, social responsibility may benefit the corporation
by creating good will, (Cornell & Shapiro, 1984) and may raise employee morale and result in
increased productivity; fewer strikes and work stoppages may more than offset the other costs
associated with being socially responsible (Marcus, 1993). Alternatively, CSR activities might
improve a firm's reputation and relationship with bankers, investors and government officials
which may well be translated to economic benefits.
Methodology
This study can be seen as exploratory because it sought to identify the main challenges
facing the mobile Telecom companies in the implementation of CSR. The study specifically
considered firms in the Telecommunication industry in Ghana. All the 6 mobile
telecommunication companies, thus, GLO, Airtel, VODAFONE, MTN, ESPRESO and TIGO
were used for the study. Only the employees of the firms were selected. Overall 360 employees
were sampled. The sampled includes included managers, accountants, financial managers,
public relationship officers, marketing managers, general employees. The sample included
both management and general employees. The selection of the sample size was based on
convenience. Convenience sampling technique was used because only the employees the
companies who have knowledge about the issues under investigation and were present at time
of the study were included.
A Structured questionnaire was used to collect data from the employees of the selected
companies. To ensure that the reliability of the respondents, samples of the questionnaire were
pre-tested. The reliability scale that was used in the study is the Cronbach’s alpha. Struwig and
Stead (2001) describe Cronbach’s alpha (Cronbach, 1951) as a measurement of how well a set
of items measure a single one-dimensional talent construct. The measure ranges from 0 to 1. A
value of 1 indicates perfect reliability, and the value 0.70 is considered to be the lower level of
acceptability (Hair, Anderson, Tatham & Black. 1998). Therefore, a Cronbach’s alpha of at
least 0.70 was ensured.
Demographic Profile of Respondents
The table 1 below represents the demographic characteristics of the respondents who were
employees of the various Telecommunication companies included the in the study. The profile
of the respondents included, gender, age, educational background, position held and tenure of
work. The employees were selected from GLO, AIRTEL, VODAFONE, MTN, EXPRESSO
and TIGO.
Profile
Gender
Age (years)
Tenure of Service
Table 1: Demographic Profile of Respondents
Category
Number
Male
220
Female
140
Total
360
less than 20yrs
14
20-29 yrs
136
30-39yrs
120
40-49yrs
90
Total
360
1-5 years
182
6-10 years
135
11-15 years
35
16 and above
8
Total
360
%Freq.
61.1
38.9
100.0
3.9
37.8
33.3
25.0
100.0
50.5
37.5
9.32
2.7
100.0
Source: Field Survey Data
Data analysis, results and discussions
In this study, both descriptive and inferential statistics such as frequency distribution was
used to assess the demographic profile of the respondents. Also, measures such as mean and
standard deviation were used to present the findings of the objectives of the study. To examine
which company achieved more competitive advantage with the use CSR, a non-parametric test,
Kruskal Wallis H Test was performed to compare the competitive advantage of the companies
through CSR.
Extent of implementation of CSR strategies by Mobile Telecommunication companies
The first specific objective of the study was to determine the extent of implementation of
CSR strategies by Mobile Telecommunication companies in Ghana. The performance of the
companies in CSR was examines using a Five-point Scale. The outcome summarized in Table
2.
Table 2: CSR implementation strategies of Mobile Telecommunication Companies
N
Mean St dev.
Our company have a CSR manager
360
4.40
0.69
Our company have a CSR-committee
360
4.35
0.84
Rate the company’s reputation in delivery CSR
360
4.18
0.83
Our company apply CSR standard (ISO 26000)
360
4.18
0.72
The rate to which the company undertakes philanthropic 360
4.05
0.72
activities (community service)
The rate to which the company engage CSR to protect the 360
3.96
0.75
environment
The extent to which the company communicates its CSR 360
3.93
0.73
activities to the public
The extent to which the company considers CSR as ethical 360
3.91
0.78
issue
The extent to which the company consider CSR at voluntary 360
3.75
0.96
The extent to which the company’s CSR covers employees 360
3.68
0.77
occupation health and safety
Overall implementation of CSR
360
4.04
0.78
Scale: 1= “Very low”, 2= ‘Low”, 3= “Moderate”, 4= “High”, 5= “Very high”.
Source: Field Survey Data
The findings revealed that the performance of the sampled Telecom companies in CSR was
moderate to high (Mean = 4.00-5.00). High performance (Mean 4.00-5.00) was attained with
respect of each of the following areas; having CSR manager (Mean = 4.40, Stdev = 0.69),
having a CSR committee (Mean = 4.35, Stdev = 0.84), reputation in delivery CSR (Mean =
4.18, Stdev = 0.83), application of CSR standard (ISO 26000) (Mean = 4.18, Stdev = 0.72),
and philanthropic activities (community service) (Mean = 4.05, Stdev = 0.72). This implies
that the selected companies have implemented CSR to high extent in these areas. The
companies also attained moderate performance (Mean: 3.00 - 3.99) in CSR in each of the
following areas; the company engagement CSR to protect the environment (Mean = 3.96, Stdev
= 0.75), the extent to which the companies communicate its CSR activities to the public (Mean
= 3.93, Stdev = 0.73), the extent to which the companies consider CSR as ethical issue (Mean
= 3.91, Stdev = 0.78), the extent to which the companies consider CSR at voluntary (Mean =
3.75, Stdev = 0.96), and the extent to which the companies’ CSR covers employees occupation
health and safety (Mean = 3.68, Stdev = 0.77). On the average the sampled Telecom companies
performance in CRS was high (Mean = 4.04, Stdev = 0.78). The implication is the Mobile
Telecommunication Companies consider CSR as a priority.
According to Donaldson and Preston (1995) businesses have always had some sort of
relationship with the communities that live around them, usually because they recruit staff
locally. Businesses spend time and money assisting local communities in a variety of ways e.g.
supporting education programmes and health awareness initiatives. The current study found
that the companies also undertake philanthropic activities (community service). Donaldson and
Preston (1995) reported that environmental issues are one of the top issues on most of the
companies in CSR agenda. The current study also found that the Mobile Telecommunication
companies engaged in CSR to protect the environment.
Factors influencing the decision of the Mobile Telecommunication companies to
undertake CSR
The second objective of the study was to ascertain the factors influencing the companies to
engage in CSR. This objective was achieved quantitatively using a Five-point Likert Scale and
the outcome summarized in Table 3. Mean and standard deviations were used to present the
findings. The mean values represent the average response given by all respondents while the
standard deviation represents the spread of the responses as given by the respondents on the
scale. If the overall mean value significantly greater than 3.0 (Test value) then the factor is
considered an important factors influencing the decision of the Telecom companies to
undertake CSR. One-sample Z-test was conducted at 5% alpha to determine whether or not the
mean value are greater than 3.0.
Table 3: Reasons for engaging in Corporate Social Responsibilities
Cronbach alpha=0.834
N
Mean St
z-stat Sig (one –
dev
tailed test)
To enhance the reputation of the company’s 360 4.48
0.79
14.51
0. 000*
For positive image and branding of the 360 4.48
0.77
14.89
0. 000*
company
As a way of giving back to society
360 4.26
0.82
11.90
0. 000*
To gain some competitive advantages
360 4.15
0.86
10.36
0. 000*
To comply with standards (e.g. Codes of 360 4.01
0.83
9.43
0. 000*
Conducts, Corporate Governance Codes,
ISO 9001)
Improving business performance
360 3.98
1.25
6.07
0. 000*
As a way of disclosing information to the 360 3.93
0.93
7.75
0. 000*
general public
To market the products and services of the 360 3.88
0.97
7.03
0. 000*
company
To play by the rules in the industry
360 3.80
0.87
7.12
0. 000*
To establish better team spirit and sharing 360 3.75
0.81
7.17
0. 000*
common goals among employees of the
company.
To attract new clients
360 3.75
1.12
5.19
0. 000*
CSR is the entry requirement of the 360 3.55
0.94
4.53
0. 000*
companies into the Telecommunication
sector
To gain some cost reduction
360 2.33
0.98
-5.30
1.000
*Statistically significant at 5% alpha level (0.05)
Scale: 1=Strongly Disagree, 2= Disagree, 3 =Neutral, 4= Agree, 5 =strongly agree
Source: Field Survey Data
The findings revealed that the engagement of the selected in CSR was motivated a number
important factors (p < 0.05). This included, in the opinion of the respondents; to enhance the
reputation of the company’s (Mean = 4.48, Stdev = 0.79), for positive image and branding of
the company (Mean = 4.48, Stdev = 0.77), as a way of giving back to society (Mean = 4.26,
Stdev = 0.82), to gain some competitive advantages (Mean = 4.15, Stdev = 0.86), to comply
with standards (e.g. Codes of Conducts, Corporate Governance Codes, ISO 9001) (Mean =
4.01, Stdev = 0.83), to improve business performance (Mean=3.98, Stdev = 1.25), as a way of
disclosing information to the general public (Mean = 3.93, Stdev = 0.93), to market the products
and services of the company (Mean = 3.88, Stdev = 0.97), to play by the rules in the industry
(Mean = 3.80, Stdev = 0.87), to establish better team spirit and sharing common goals among
employees of the company (Mean=3.75, Stdev = 0.81), to attract new clients (Mean = 3.75,
Stdev = 1.12), and CSR is the entry requirement of the companies into the Mobile
Telecommunication sector (Mean = 3.55, Stdev = 0.94). This were the main reasons why the
Mobile Telecommunication Companies engage in CSR practices.
From theoretical and practical perspectives, organizational reputation ranks as one of the
most important mediating variables linking CSR to business performance (Fombrun &
Shanley, 1990). This is because external reputation influence consumer decision processes
(Schuler & Cording, 2006). CRS of gives the companies positive brand image. The current
study also found enhancement of the reputation of the companies, and building positive brand
image were the first reasons for the Telecom companies engaging CSR. According to Miller
(1997), CSR may help the business generate more sales revenues and therefore improve upon
their overall performance. Improving business performance and also to increase sales of
products and services of the company were also identified as the reasons for the companies
engaging in CSR. Attracting new clients was one reason for the companies engaging in CSR.
Firms with high CSR may also attract better employees who are internal clients of the
companies. The supports the findings of Backhaus et al. (2002). They found that CSR serve
as a signal to potential applicants that the organization is a socially responsible employer and
upholds ethical values.
Perceived influence of CSR in achieving competitive advantage
The third specific objective of the study was to examine the perceived influence of the
practice of CSR in achieving competitive advantage among the companies. Employees of the
Telecom companies were made to respond to items in this section using a Five-point Scale and
the output presented in Table 4.
Table 4: Perceived influence of CSR in achieving competitive advantage
N
Mean
Stdev
Branding positioning
360
4.40
0.80
The public goodwill towards the company
360
4.25
0.91
Overall performance of the company
360
4.22
1.01
Corporate reputation
360
4.20
0.87
Public interest in the activities of the company
360
4.13
0.85
Investors’ confidence
360
4.03
0.93
Market performance
360
3.78
0.78
Profit maximization
360
3.53
0.87
Ability to retain employees
360
3.46
0.87
Reduction in operational cost
360
3.05
0.85
Overall impact of CRS
360
3.91
0.87
Scale: 1= “Very low”, 2= ‘Low”, 3= “Moderate”, 4= “High”, 5= “Very high”.
Source: Field Survey Data
The outcome showed that the influence of CSR in achieving competitiveness ranged from
moderate to high (Mean; 3.00 - 5.00). High influence of CSR in achieving competitive
advantage was recorded in each of the following areas of the organization; brand positioning
(Mean = 4.40, Stdev = 0.80), public goodwill towards the company (Mean = 4.25, Stdev =
0.91), overall performance of the company (Mean = 4.22, Stdev = 1.01), enhanced corporate
reputation (Mean = 4.20, Stdev = 0.87), public interest in the activities of the company (Mean
= 4.13, Stdev = 0.85), and investors’ confidence (Mean = 4.03, Stdev = 0.93). Also, moderate
influence of CSR in achieving competitive advantage was found the areas of market
performance (Mean = 3.78, Stdev = 0.78), profit maximization (Mean = 3.53, Stdev = 0.87),
ability to retain employees (Mean = 3.46, Stdev = 0.87), and reduction in operational cost
(Mean = 3.05, Stdev = 0.85). Overall, however, the CRS had moderate impact in achieving
competitive advantage claimed by the Telecom companies (Mean = 3.91, Stdev = 0.87).
The finding of this study confirms of other researchers. For example, Porter & Kramer,
(2006) found that the business case perceives CSR engagement is a source of opportunity,
innovation and competitive advantage (Porter & Kramer, 2006). The findings also suggests
that companies align CSR with their operations to operate in a cost-efficient and competitive
manner in order to secure their position in the face of augmented global competition. Positive
impact of CSR was evident with regards to human resources, risk and reputation management
and innovation. Also Ullman (1985) found that financial Profitability and Social responsibility
are positively related - profitable firms are better social performers. Marcus, (1993) also
illustrates the positive effect of CSR on Corporate performance citing that firms that have a
good effect on society are also highly profitable. Pava and Krausz (1996) also corroborated this
evidence but at the same time contradicted the finding by stating that while not all studies prove
high-CSR firms perform better, there is evidence that such firms perform at least as well as
lower-CSR firms.
Challenges of Mobile Telecommunication companies in engaging in CSR
The fourth objective of the study was to identify the challenges facing Mobile
Telecommunication companies in the implementation of CSR. The challenges of the company
for engaging in CSR were assessed quantitatively using a Five-Point Likert Scale and the
results summarized in Table 6. Mean and standard deviations were used to present the findings.
If the overall mean value significantly greater than 3.0 (Test value) then the factor is considered
an important challenge of the companies in implementing CSR policies. One-sample Z-test
was conducted at 5% alpha to determine whether or not the mean value are greater than 3.0.
Table 6: Challenges of Mobile Telecommunication companies in undertaking CSR
Challenges
N
Mean St. dev. z-stat Sig (one –
tailed test)
Perceived high corporate image
360 3.43
0.99
3.36
0.000*
Low profitability of the company
360 3.03
0.86
0.27
0.394
Lack of shareholders’ commitment
360 2.45
1.03
-4.14 1.000
The company’s CSR is not recognized by 360 2.40
1.26
-3.69 1.000
society
Lack of organizational commitment
360 2.36
1.00
-4.96 1.000
CSR has no positive effect on the 360 2.33
1.32
-3.93 1.000
performance of the company
Lack of CSR strategy
360 2.00
1.17
-6.85 1.000
Scale: 1=Strongly Disagree, 2= Disagree, 3 =Neutral, 4= Agree, 5 =strongly agree
Source: Field Survey Data
The Mobile Telecommunication companies seem to have virtually no challenge in
implementing CSR. The only challenges is the feeling of the Mobile Telecommunication
companies that they have high corporate image (Mean= 3.43, St dev = 0.99) and therefore does
not have to engage to CSR to boost the corporate image. From theoretical and practical
perspectives, organizational reputation ranks as one of the most important mediating variables
linking CSR to business performance (Fombrun & Stanley, 1990). This is because external
reputation influence consumer decision processes (Schuler & Cording, 2006). CSR of gives
the companies positive brand image. Companies with low brand image in a competitive
business environment therefore engages more in CSR to enhance its image. The opposite may
also be true that if a company is complacent of its brand image in the business environment it
may tend to engage less in CSR just for the purpose of enhancing the brand image. The current
study also found on the changes in engaging CSR is that the companies perceived the image in
the Mobile Telecommunication sector to be high and therefore do not need to engage in CSR
practice.
The effect of CSR on the competitiveness of Mobile Telecommunication Companies
To determine which of the companies had a higher competitive advantage the other rest, a
Kruskal Wallis H test was performed and the outcome shown below.
Table 5: CSR and the competiveness of Mobile Telecommunication Companies
Network
N
Mean
Chi
Sig
Rank
Square
Corporate reputation
AIRTEL
60
18.95
17.611 0.000*
VODAFONE 60
40.25
MTN
60
32.30
GLO
60
15.25
EXPRESSO
60
9.56
TIGO
60
17.24
Total
360
Branding positioning
AIRTEL
60
16.75
25.395 0.000*
VODAFONE 60
40.50
MTN
60
34.25
GLO
60
19.55
EXPRESSO
60
2.25
TIGO
60
17.25
Total
360
Profit maximization
AIRTEL
60
27.75
5.006
0.082
VODAFONE 60
26.63
.
MTN
60
37.13
GLO
60
18.25
EXPRESSO
60
7.25
TIGO
60
22.53
Total
360
Reduction in operational cost
VODAFONE 60
36.63
5.115
0.078
MTN
60
29.08
GLO
60
25.80
EXPRESSO
60
5.45
TIGO
60
26.25
Airtel
60
24.72
Total
360
Ability to retain employees
AIRTEL
60
25.25
3.362
0.186
VODAFONE 60
34.40
MTN
60
31.85
GLO
60
21.43
EXPRESSO
60
2.25
TIGO
60
20.25
Total
360
Market performance
AIRTEL
60
32.95
0.910
0.634
VODAFONE
MTN
GLO
EXPRESSO
TIGO
Total
Investors’ confidence
AIRTEL
VODAFONE
MTN
GLO
EXPRESSO
TIGO
Total
Public interest in the activities of AIRTEL
the company
VODAFONE
MTN
GLO
EXPRESSO
TIGO
Total
The public goodwill towards the AIRTEL
company
VODAFONE
MTN
GLO
EXPRESSO
TIGO
Total
Overall performance of the AIRTEL
company
VODAFONE
MTN
GLO
EXPRESSO
TIGO
Total
* Statistically not significant at 5% alpha level (0.05)
60
60
60
60
60
360
60
60
60
60
60
60
360
60
60
60
60
60
60
360
60
60
60
60
60
60
360
60
60
60
60
60
60
360
30.45
28.10
24.35
0.25
27.52
28.25
32.03
31.23
27.25
14.25
27.52
.579
0.749
22.90
35.90
32.70
19.25
3.58
22.25
6.846
0.033*
21.80
36.90
32.80
19.25
0.13
20.52
9.479
0.019*
25.00
38.10
28.40
18.42
2.53
22.25
7.239
0.027*
Source: Field Survey Data
The non-parametric Kruskal Wallis H Test revealed that VODAFONE had better
competitive advantage than all the telecommunication companies (p < 0.05). Regarding
corporate reputation aspect of competitive advantage of the firm, VODAFONE is most
competitive of the six companies followed by MTN, Airtel, TIGO, GLO and EXPRESSO.
With respect to the branding positioning aspect of competitive advantage of the firm,
VODAFONE is most competitive followed by MTN, GLO, TIGO, Airtel and EXPRESSO.
Pertaining to the public interest in the activities of the company aspect of competitive
advantage of the firm, VODAFONE is most competitive followed by MTN, AIRTEL, TIGO,
GLO and EXPRESSO. Concerning the public goodwill towards the companies as a measure
of competitive advantage of the firms, VODAFONE is most competitive followed by MTN,
Airtel, TIGO, GLO and EXPRESSO. With respect to the overall performance of the company
as a competitive advantage of the firms, VODAFONE is most competitive followed by MTN,
AIRTEL, TIGO, GLO and EXPRESSO. Overall, VODAFONE is most competitive of the six
companies in the areas of; corporate reputation, brand positioning, public interest in the
activities of the company, public goodwill towards the company, and overall performance of
the company. However, there is no significant difference (p > 0.05) in the competitiveness of
the companies in the area of profit maximization, reduction in operational cost, ability to retain
employees, market performance, and investors’ confidence.
Conclusions and recommendations
Based on the findings of the study, the following conclusions were made. The Telecom
companies are highly engaged in CSR practices in the areas of community support,
environmental issues, and ethics. The Mobile Telecommunication Companies engaged in CSR
for various reason including enhancing the reputation of the company’s, for positive image
and branding of the company, as a way of giving back to society, to gain some competitive
advantages, to comply with standards, to improve business performance etc. The CSR practices
enables the companies to attain a competitive advantage. VODAFONE is much more
competitive advantage than all the other Mobile Telecommunication Companies. A positive
feeling of high corporate image (complacency) is bane of CSR practices of the Mobile
Telecommunication Companies.
CSR was not engaged to a very high extent among the Mobile Telecommunication
Companies. The companies in the industry must engage to very high extent ethical and
philanthropic obligations to the communities in which the operation. This will help achieve
greater competitiveness in the industry. It is essential that shareholders of the company should
not only consider profit maximization but must also be willing to give part of their profit before
tax to as CSR as this was found to have positive impact on its corporate image and boosting its
overall performance. Future studies should consider using secondary data to find the
relationship between expenditure on CSR and profitability of companies in Ghana. Studies
could also be conducted into the effect of CSR on the competitiveness of firms from the
perspective of consumers.
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