Csr in Small Business
4. CSR in SMEs
It is important to know how CSR is defined and understood by SMEs; lots of research has been carried out in relation to how CSR is viewed by large firm but research about CSR in SMEs are very few and limited, this fact shouldn’t take away the enormous importance in understanding how CSR is defined, understood and undertaken by small firms, after all, as stated by the Australian Centre for Corporate Social Responsibility (2012) small to medium-sized firms account for about 90 percent of worldwide businesses and employ 50-60 percent of world workforce. As we are concentrating our project on a Small firm, it is only fair to look at how CSR is viewed and done by SMEs and to investigate to what extent it differs or it’s similar to the large firm views.
4.1. Difference in CSR in SMEs and large Firms
There is bound to be difference in how SMEs understand and undertake CSR activities compared to large firm, for one, the structure and management styles of SMEs and large firms are different and as pointed out by Sweeney (2009, pg. 81) when commenting on the difference of CSR in SMEs and large firms that “one major difference is the fact that in SMEs, ownership and control is often the responsibility of one person” as opposed to the responsibility of mostly a department in large firms. These can have varied effect in relation to the nature, context and activities of CSR in relation to SMEs and large firms.
Also because of the ownership style of SMEs, CSR understanding and activities is mostly determined by owner’s personal choices or understanding. This is point is supported by Sweeney when she indicated that:
A key difference between large and small firms is that in small firms, ownership and management are not separated to the extent that they are in large multinational firms (Spence and Rutherfoord, 2001). Thus, control remains in the hands of one of the owners, potentially enabling him or her to make personal choices about the allocation of resources
It is important to know how CSR is defined and understood by SMEs; lots of research has been carried out in relation to how CSR is viewed by large firm but research about CSR in SMEs are very few and limited, this fact shouldn’t take away the enormous importance in understanding how CSR is defined, understood and undertaken by small firms, after all, as stated by the Australian Centre for Corporate Social Responsibility (2012) small to medium-sized firms account for about 90 percent of worldwide businesses and employ 50-60 percent of world workforce. As we are concentrating our project on a Small firm, it is only fair to look at how CSR is viewed and done by SMEs and to investigate to what extent it differs or it’s similar to the large firm views.
4.1. Difference in CSR in SMEs and large Firms
There is bound to be difference in how SMEs understand and undertake CSR activities compared to large firm, for one, the structure and management styles of SMEs and large firms are different and as pointed out by Sweeney (2009, pg. 81) when commenting on the difference of CSR in SMEs and large firms that “one major difference is the fact that in SMEs, ownership and control is often the responsibility of one person” as opposed to the responsibility of mostly a department in large firms. These can have varied effect in relation to the nature, context and activities of CSR in relation to SMEs and large firms.
Also because of the ownership style of SMEs, CSR understanding and activities is mostly determined by owner’s personal choices or understanding. This is point is supported by Sweeney when she indicated that:
A key difference between large and small firms is that in small firms, ownership and management are not separated to the extent that they are in large multinational firms (Spence and Rutherfoord, 2001). Thus, control remains in the hands of one of the owners, potentially enabling him or her to make personal choices about the allocation of resources
Bibliography: Lorraine Sweeney, (2007) "Corporate social responsibility in Ireland: barriers and opportunities experienced by SMEs when undertaking CSR", Corporate Governance, Vol. 7 Iss: 4, pp.516 – 523. Available at: http://0-xtra.emeraldinsight.com.millennium.it-tallaght.ie [Accessed 2012-10-31]. Euroabstracts. (2007). Thoroughly Modern Morals. [Online]. February 2004. Available at: http://elearning.it-tallaght.ie/mod/resource/view.php?id=118313 [Accessed 2012-10-31]. Lorrained Sweeney. (2009). A study of current practice of Corporate Social Responsibility (CSR) and an examination of the relationship between CSR and Financial Performance using Structural Equation Modelling (SEM) [Online]. December 2009. Available at: arrow.dit.ie/appadoc/19/ [Accessed 2012-10-31]. Australian Centre for Corporate Social Responsibility. (2012). The Importance of Corporate Social Responsibility for SMEs [Online]. Available at: http://www.accsr.com.au/pdf/SMEs_and_CSR.pdf [Accessed 2012-10-31]. Heledd Jenkins. (2012) .Corporate social responsibility– engaging SMEs in the debate. [Online]. Available at: http://www.brass.cf.ac.uk/uploads/CSRandSMEs.pdf [Accessed 2012-10-31].