Employees Involvement In Csr Practices

Published Date: 02 Nov 2017

1.0 Introduction

According to Barnett and Salomon (2006), increasing numbers of investors are not only looking at the financial performance in a corporation’s portfolio but are also valuing the way corporations meet their social responsibilities. This is because not only profit alone that enhances shareholder value but the brand name also contributes. Investors attribute higher valuations to companies that are social responsible citizens. Henceforth, the framework and practices of CSR are becoming essential to improve their CSR performance, stimulate investments and reduce cost of capital.

There are several studies concerning the relationship between CSR and firm performance. For example, Russo and Fouts (1997) conceptual framework noted that there was a positive relationship between environmental performance and financial performance. The main body of CSR rest on the vision that being socially responsible is a way towards developing and improving effectiveness of both the society and people.

Organizations in Mauritius are acting in a socially responsible manner thereby catering for people, environment and profits. However, not all parts of the society have been able to advance at the same pace. According to the Central Statistics Office’s Poverty Analysis Report 2006/07, there are about 26,400 poor households in Mauritius which represent 7.9 per cent of the total number of Mauritian households. Furthermore, the government estimated that some 7000 families are trapped in the vicious circle of poverty and live on a monthly income of less than Rs5000.

Henceforth, during its Budget Speech 2007/08 the state made an appeal to the private sector to contribute voluntarily at least one percent of their profits to CSR activities specifically directed towards pressing social issues of national priority. Nevertheless, a major transformation took place after the Budget 2009 that caused a significant change to the new CSR agenda. When Mauritius was hit by the global crisis, Mauritian government called for solidarity and passed a law whereby all profitable firms have to devote two percent of their profits to CSR projects. The primarily purpose of such an action is foster social development and to fight against poverty.

Efforts need to be properly coordinated so that CSR becomes a tool for national development both at private sector level and at governmental level to achieve equitable, inclusive and sustainable development.

1.1 Problem Statement

Although CSR practices have been indulged into the Mauritian context quite a long time ago, yet it is considered that the CSR agenda has not been fully been implemented in organization’s corporate culture. This is because the majority of companies do not have a full-fledged CSR committee or department nor have a formal CSR policy. On the other hand, in certain circumstances, CSR is used simply for window-dressing purposes as it is a fashionable topic whereby people are doing it alongside with the wide media coverage. While coming to the frequency of CSR activities, most of the companies practice CSR initiatives on an ad hoc basis more specifically in an informal manner. The literature suggests that an organization can be socially responsible in ways that result in significant benefits for both the organization and society.

1.2 Research Objectives

To evaluate how the organization caters for the local surroundings

To apply Carroll Pyramid within the CSR system of the firm

To assess employees philosophy and involvement in CSR

To examine sustainability of CSR initiatives

1.3 Chapter Outline

Chapter 1: Introduction

This chapter introduces the conceptual framework of CSR and defines the relationship between environmental performance, financial performance and social development.

Chapter 2: Company Overview

Under this section, detailed information is provided on the company background, the mission statement and the CSR achievements.

Chapter 3: Literature Review

In this chapter, definition, concepts and empirical evidences relating to this study from previous researches are analyzed and discussed.

Chapter 4: Research Methodology

This section provides support for the methodological approach and briefly elaborates on the research objectives, population and sample size, questionnaire design and administration, data collection and research limitations. It also gives an overview about the various techniques applied in date analysis and findings.

Chapter 5: Analysis and Findings

This chapter consists of analyzing data gathered from the online survey, paper based questionnaires and interview where different variables are tested and analyzed.

Chapter 6: Conclusion and Recommendations

This chapter depicts an overall picture about this thesis and gives an overview around the subject matter of this dissertation and provides appropriate recommendations.

Chapter 2: Company Background

2.0 Introduction

Manser Saxon Contracting LTD is an Ireland Blyth Group with over 1600 employees and has been involved in many development projects for almost 18 years. Manser Saxon (MS) is a multi-discipline subcontracting company providing a wide range of services namely, Mechanical, Electrical, Plumbing (MEP) and Fit out solutions to the building and allied industry. Based in Mauritius as well as a branch in Dubai, MS has been a key player in numerous contracts in these two areas and even in Maldives and Rodrigues.

Due to the fact that the enterprise in located in poor areas such as Roche Bois, Bois Marchand and Ste Croix, so MS plays a vital role for the local habitants. As such it contributes positively in developing the local surroundings and assist adults and children in priority areas such as food distribution, education, health for small and elderly ones amongst others.

2.1 Mission Statement

Manser Saxon team is recognized for its depth knowledge and breadth of experience as they work collaboratively with their clients. The organization follows quality principles, sustainable business practices and business policies, which are continuously updated. MS mission statement has been consulted on the company’s website and the following areas have been identified.

Employees

Manser Saxon believes in employment promotion, job security, equal treatment and skills training for employees at all levels.

Families of their employees

Since 2007, MS has been awarding scholarships to best performing children of MS employees both at primary and secondary level.  To date, over 100 scholarships have been awarded and pictures in Appendix 1 can demonstrate this. Various other schemes have been put into practice to assist employees and their families through schoolbooks, discounts for purchasing food items and numerous training programs

Community

MS is very committed in its CSR initiatives as it is involved in several projects promoted by IBL Foundation to better serve the local citizens in the neighborhood. Since 2006, Manser Saxon has continually collaborated with Caritas and other NGOs of Roche-Bois and Riche-Terre on poverty eradication programs in those regions.

2.2 Contribution in the vicinity

Health for children in Roche Bois

During winter season, children in Roche Bois underwent eye examination. This is so because those having eyesight problems cannot learn properly at school. In addition, some were provided with medicines for cough and flu-like symptoms. (Refer to Appendix 2)

Mattresses given to families during cold periods

The association "Service d’Ecoute et de Developpement" identified several families and then MS team intervened by offering mattresses, tracksuits and blankets to those families.

2.3 Actions were taken by MS

Job opportunities for youngsters

In 2009, MS provided carpentry and plumbing tools to mechanics of "Centre Technique de Montfort". This foundation purpose is to group children who have failed their CPE and who are willing to learn a particular profession in fields where Manser Saxon would require work force. Therefore, these young people may get a job at MS after completion of their courses.

Well-being of small "Association of Disability Service Providers" (ADSP)

This association is found in the village of Montagne Longue and its main goal is to help children with physical and mental disabilities. Being sensitive to this issue, in 2009, MS donated 37 tracksuits to ADSP and this can be evidenced through Appendix 3.

Catering for small children of Ste Anne nursery

The nursery of Ste Anne welcomes children of 3 months to 3 years however, the contribution of poor families is not sufficient to meet diverse needs of children. Therefore, Manser Saxon team responded accordingly to their needs where kitchen utensils, mattresses, books, educational games and drawing materials were provided to the nursery. (Refer to Appendix 4)

Maternity Packs to "Mouvement d’aide à la Maternité (MAM)"

In August 2010, MS donated 10 "maternity packs" containing towels, diapers, soaps, creams, eau de cologne, among others. Moreover, those beneficiaries consisted of young mothers aged between 14 and 18 years.

Uniforms for children of "Atelier du Savoir de Terre de Paix"

This knowledge workshop is located in Albion and is a special school that welcoming children between 9-17 years. On 21 September 2010, CSR Committee of Manser Saxon donated uniforms to those children of low-income families and it this can be illustrated by referring to Appendix 5.

Employees’ involvement in CSR practices

Manser Saxon Health Day

MS had organized a "Manser Saxon Health Day" for people of Roche-Bois in collaboration with the "Private Medical Practitioners Association." The "Health Day 2011" took place on 6 November and even MS employees participated in this benevolent activity for the well-being of local people in the vicinity. Adequate medication was offered to those in need, for instance children, parents and seniors were advised on health issues such as informed diabetes screening, blood pressure measurement amongst others.

Manser Saxon helped Scouts go to camp

Manser Saxon took over the transportation and food of some 200 children from different regions including Cassis, Ste Croix and Roche-Bois. The CSR team of MS went to meet these children as evidenced by the photos. (Refer to Appendix 6)

2.5 CSR achievements of MS

Renovation of computer room at "Destiny Community Foundation"

MS renovated "Destiny Community Foundation" with tables and chairs which in found in Plaine-Magnien. Children between the age of 11 and 16 regularly visit this center because this is the only place where they have access to computer facilities.

Educational materials to disabled ones

Manser Saxon donated school supplies to 35 lucky recipients of "Association des Malades et Handicapés de l’Est" to enable they receive equal education like other young people. The association offers specialized education, training, crafts and health care. It is with joy that the CSR team came to their aid by providing educational materials to help them forget their differences.

Technical assistance to "Mouvement Social de la Jeunesse Mauricienne" (MSJM)

Manser Saxon has provided its technical assistance to repair the electrical system of the workshop to ensure that everything was according to safety standards. The main objective of MSJM is to support and improve the quality of life of adolescents in reading, writing and arithmetic.

Chapter 3: LITERATURE REVIEW

CSR Definition

Since the 1950’s there has been much debates concerning the exact definition of Corporate Social Responsibility (Welford 2003; Visser2005; Garriga & Melé 2004; Carroll 1999; Carroll & Beiler 1977) and there is no concensus on what exactly should be included in the social responsibility of organisations (Frederick 1994; Griffin 2000).

For instance if on one hand Carroll (1983), described CSR which "involves the conduct of a business so that it is economically profitable, law abiding, ethical and socially supportive. To be socially responsible then means that profitability and obedience to the law are foremost conditions when discussing the firm’s ethics and the extent to which it supports the society in which itexists with contributions of money,time and talents" On the other hand, Holme and Watts (2000) described CSR as "a continuing commitment by business to behave ethically and contribute to economic development, while improving the quality of life of the workforce and their families as of the local community at large". Alternatively CSR has also been defined as "a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis" (Hockerts & Moir 2004) unlike and Welford, ([2003], cited the European Commission, 2001) who has defines CSR as "a concept whereby companies decide voluntarily to contribute to a better society and a cleaner environment"

Perhaps because CSR has been defined differently by many authors Visser (2005) righlty pointed out that CSR is definitly seen as an umbrella term which envelopes different terms including : corporate citizenship, corporate sustainability, stakeholder management, environmental management, business ethics and corporate social performance. Furthermore the definition CSR may also depend upon the responsibility and role an organisation plays in the society (Stigson 2002; Haugh 2003; Maignan and Ferrell 2003). Welford (2003) came out with the idea that we cannot look for a single definition of CSR since it embraces different social issues which can be highly controversial.

2.1 Towards the execution of Corporate Social Responsibility

Nevertheless, despite disagreement concerning the definition of CSR one thing for sure is that from the year 1990 approximately, the CSR concept has become almost universally sanctioned and promoted by all constituents in society from governments and corporations to non-governmental organizations and individual as proposed by Rong Fang et al. (2009).

Likewise, author such as Iamandi (2007) indicated that CSR is seen as a panacea to global problems. In the same limelight the latter ([2007], cited an article published by the European Multistakeholder Forum, 2004) even pointed out that the main reason behind which the CSR concept has been implemented lies in the "Triple Bottom Line" – "Profit, People, Planet" which clearly stated that companies need to synchronize efforts in order to achieve economical success while catering for the environment, society and legal regulations at the same time.

In addition to this Carroll (1979), even mention that CSR not only envelope legal and economic obligations it also embraces responsibilities which include philanthropic and ethical one for promoting the betterment of the society on the loose. Similarly, Mcguire et al., (1988) came forward with the idea that CSR is a core corporate obligation that comprises of the decision making process, the financial performance of the firm along with the ethical and social concerns.

2.2 Theoretical Framework of Corporate Social Responsibility

Since the purpose of the study involves whether there is a degree of consistency with Carroll pyramid, it is better to present a panoramic view of different CSR perspective in order to better analyse the research objective.

2.2.1 The four components of CSR: Carroll’s Pyramid

Carroll’s Pyramid is considered as probably the well-known model for Corporate Social Responsibility, this particular model consist of four levels namely; economic, legal, ethical and discretionary responsibilities that society expects of organisations in a hierarchical ordering. Carroll has integrated concepts of stakeholders and corporate citizenship into his pyramid and this act as a framework for understanding CSR. It has been observed that the four components depicted by Carroll (1991) was later revisited by Visser (2006) in order give a new perspective.

Jamali and Mieshak ([2006], referred to Carroll, 1979) and Iamandi (2007) mentioned model of CSP proposed by carol (1979) in which the latter clearly distinguished four types of responsibilities CSR namely: economic, legal, ethical, and discretionary.

When the first category is taken into consideration, it can be observed that the economic responsibilities is of the utmost importance since Iamandi (2007) clearly stated that to be profitable "are the first and foremost social responsibilities of a business organization, the foundation upon which all other rest". Furthermore, Jamali and Mieshak (2006) added that other components that contribute economic responsibility include; providing fair pay to all the employees, creating jobs for people, catering for the return on investment to all the shareholders, focusing on research and development and innovation and promoting technological and others. According to the latter the mentioned strategies are attached with the economic obligation.

As far as the legal responsibility is concerned it entailed compliance to legal aspects that is to abide to the rules of the games (Solomon 1994). Moreover, Iamandi (2007) stated that legal responsibilities goes in hand with the ecomonic one so as to ensure that societal expectations are being met within the legal framework by the organisation. Therefore it goes without saying that the core aspect of CSR is that activities are to be performed with compliance to the government and the law (Jamali and Mieshak 2006). Nevertheless, while regulations may successfully coerce organisations to pay close attention to respond to such things, it seemed to be difficult to ensure that such strategies are correctly applied in practical (Pratima, 2002).

When taking into consideration the ethical responsibilities it is imperative to clearly point out that this responsibility helps in overcoming some of the limitation of law because it creates an ethics ethos that companies abide to (Solomon, 1994). It depicts a business as being right, fair and doing the right thing that may not necessarily be prescribed that the law but yet organisation are expect to follow, for instance to avoid social injuries, prevent harms to society and pay respect to the public in general. Therefore it can be observed that such responsibility is mainly rooted in religious convictions, humane principles, and human rights commitments (Lantos, 2001).

Discretionary also known as Philantropic responsibilities assume that certain roles are to be carried out on a purely voluntary basis.Moreover this type of responsibility is deeply rooted in the belief that organisations and the society are both tangle in a rather organic way (Frederick, 1994). Examples of such activities might include philanthropic contributions, conducting in-house training programs for drug abusers, or attempts at increasing literacy rates (Carroll, 1979).

A Hiearchy of CSR : Jamali & Mirshak 2007 page 247

Thus if one hand the pyramid of Caroll which describe the responsibities are presented in a rather hierarchical flow which start with the economic responsibility ending with the philantrophic one the other hand Visser (2007) came with a rather contradictory analysis as shown below.

2.2.2 A critical analysis of Caroll pyramid

Despite the fact that Visser (2005) believed that Carroll’s Pyramid of CSR is considered as the univeral model of CSR, he firmly added that the model presented by the latter mostly suited the developed countries and it may not be suitable for understanding CSR in developing countries. Perhaps for this reason Visser (2005) revisited Caroll’s pyramid and shed more light on the pyramid theory.Indeed such initiative has pushed developing countries towards practicing Corporate Social Responsibility.

Additionally, in an article published in the year 2006, Visser pointed out that rational for focusing on CSR in developing lies in the fact that nowadays developing countries are rapidly expanding their economies and there is a need for additional support in order to support such countries whether financially or philantrophically. It has also been stated that that developing countries are mostly vulnerable as far as social and environmental crises are concerned (WRI, 2005; UNDP, 2006) and that developing countries are lagging behind when economic growth, investment, and business activity are considered (World Bank, 2006). Perhaps For this reason Visser (2006) positioned philantrophic on the first position in the hierarchical model followed by ethical legal and economical responsibilities respectively. This type of responsibility can help improve the socioecononic situation of these developing countires.

It is very interesting to note that Visser (2007) pointed out that in developing countries the CSR concept is mainly associated with charity and philanthropy or charity for example; investment in sports, education, community service, environmental awareness and health are gaining more and more inportance. Other resarchers who supported Visser pointed out that religious values, belief and culture are considered as a main motivators for CSR (Amaeshi et al. 2006, Frynas 2006, Chapple and Moon 2005) as such philanthropic responsibility is on the top of the agend because it is linked with well-being of the community, solidarity and social help which are deeply rooted with a nation’s culture.

Stakeholders theory

An article published by Gokulsing ([2011], mentioned Freeman, 1982) refer to the stakeholders theory as being a theoretical framework in which an organisation plays a mojor social role in the interest of its stakeholders which include (Lépineux, 2003):

Internal stakeholder

Employees interests

These people have direct interests in the organisation because they are satisfying their needs by working there. Henceforth, it is the responsibiliy of the management to protect and ensure that workers interests are protected.

Giving fair and reasonable wages and other fiancial bebefits to worker

Developing administrative procedures that promote cooperativeness between employers and employees

Recognise trade union rights

Ensuring that workers participate in management activities

Organisation need to help improve working conditions and create a sense of belongingness

Operational partners

Customers should be charged at a reasonable and fair price

The supply of both goods and services should be standardised and of reasonable quality

Customers should not be misleaded by false and exaggerated advertisements

Insurance companies (specially when the insurance companies having to contend with classes of risk currently undergoing a substantive and indepth renewal, i.e. "greater" catastrophes related w ith climatic changes today)

Banks ( who lend money to companies, they also as parties that expect stability and solvency)

Create a healthy and cooperative inter-business relationship between several businesses

Provide accurate and relevant information to creditors and suppliers

Pay materials, interest on borrowings and other charges propmptly

Social community

State authorities

Specialised organisations like trade unions

Non-Governmental Organisations -For example is the denunciation of the environmental spoliation being caused by oil, mineral and chemical companies, etc. (air and water pollution, deforestation, toxic waste, etc.)

Companies are law abiding citizens

Pay taxes and other dues fully, timely and honestly

It should not engage in fradulent practices or misguide the state

Maintaining fair business policies and practices

Playing a proper role in civic affairs

Providing and encouraging a wide range of facilities and create better living conditions

2.2.4 Motiovations that drives CSR

Companies that are socially responsible in making profits also contribute to some, although obviously not all, aspects of social development.These motivations that include:

Creation of Value

Some areas of research saw CSR is an instrument of accountability and the creation of value (Gray, 1996; Mayo, 1996). In this way, CSR could increase the ‘voice’ (Hirschman, 1970) and the involvement of the various stakeholders. Thus, it can be used as an instrument to facilitate changes in the mechanism of governance and to predict external changes.

To maintain positive public image and reputation enhancement

Following the arguments above regarding legitimacy it could be suggested that companies do perceive social and environmental accounting to be useful as a tool to enhance the image of the company (KPMG survey, 2005)

The desire to comply with legal requirements

For example, Mauritian Corporate Code of Governance has encouraged lots of firms to start reporting on their social practices.

Improve relations with stakeholders

By giving more attention to various stakeholders, the company builds trust and loyalty among them. Through the responsibility practice, companies are trying to understand how he different stakeholders perceive them and they can take immediate remedial actions where they get negative feedback. By creating a positive image, these firms also bring the government on their side and gain several advantages.

Use CSR as a risk management tool

CSR can be used to identify practices or situations that can cause liabilities to the company. While working closely with various stakeholders, management gets to sense any problem easily. It becomes possible to solve the problem at an early stage and this saves a lot of legal actions and/or negative public exposure that could have happened.

To gain market advantage

By using the positive image that management has been able to attain through CSR, the firm can attain a greater market share of the market as well as discover new and overseas market. Using this advantage of positive image, these firms are able to overcome all the challenges of a new market.

Managing the supply chain

Nowadays, lending institutions and suppliers are asking their clients to periodically provide information about their social and environmental policies performance. This is done by them as part of their own risk management policies.

Increase financing

Most investors are including non-financial metrics in analysis of their investment. It has been noted that investors are willing to pay higher prices for shares of companies that are willing to invest more in well-governed companies than in poorly governed ones. Thus, management can view CSR as a means to attract additional investors.

Avoid negative campaigns

In order to prevent being target of campaigns by human rights and labour rights, firms prefer to indulge in social practices which may cost less as compared to negative effects these campaigns can cause. At the same time, this produces an improved reputation of the business.

Increase worker productivity

By doing business in accordance with human rights and labour rights, management can ensure their workers will be encouraged to work harder and overall productivity will increase. This can also help to reduce workers turnover.

Reducing cost and increase profitability

Operational efficiencies can be achieved by reducing energy and materials. Minimising waste enable firms to reduce their cost of production and hence increase profits. Also, waste can be recycled and hence there is protection of the environment.

Improve competitive advantage

According to Connolly (1997) ,when engaging and showcasing the companies social and economic best practices to protect the environment, the company can enjoy a competitive edge in the market, which in turn impacts on the scrutiny of corporate sustainability activities.

Arguments for and against CSR

Argumments for CSR

Since a business operation enhances its economic, shares values social and environmental performance it implies that CSR will definitely have a positve influence on the following (Mendes, 2007):

Enhance corporate reputation

Boost brand equity

Improve shareholder relations

Developing community soilidarity

Expand customer relations

Boosting market share

Increase employee loyalty

Rise productivity

In the same lime light authors such as Amaeshi (2006), Frynas (2006), Carroll (1999, 1997) Stigson (2002) and Maignan et Al (2003) highlighted that CSR can help in:

Changing public expectations

Nowadays a change in business expectations has a direct impact on consumer needs. It can be highlighted that firms have a social and moral obligation towards the local comminty and in this way they have to respond to the needs of society and remains loyal towards to organisation and vise-versa.

Business is a part of society

There is a very beneficial relationship between the society and business. The community becomes a major recipient of employment opportunities and economic development while the enterprise benefits through its workforce.

Avoiding intervention by government

When firms are socially responsible, they attract less attention from regulatory bodies. Evidently, organisations become flexible in their operating practices and enjoy more freedom.

Balance of responsibility and power 

It is true that firms have significant authority and power but they must exercise this power with a corresponding amount of responsibility.

Impact of internal activities of the organization on the external environment

Almost all organisations are based on the open systems, i.e., they have to consider the impact of the impact of their business operations on the environmens. A firm which is socially responsible can prevent negative impact on the local surroundings.

Safeguarding shareholder interests

A company can enhance its image when it participates in social initiatives, therefore at the same time it is protecting shareholders’ interests.

New avenues to create profits

Social responsibility also implicates the preservation of natural resources as this can be very beneficial for organisation. Certain items can be recycled and profitably used again.

Favorable public image

Firms create a positive public image in the society if it engages in social activities. Henceforth, this attracts investors, customers and employees.

Endeavor to find new solutions

Businesses are usually on the edge of indulging in innovative practices. Thus, they find remedies for social harms which other institutions were unable to tackle.

Maximum use of business resources

Businesses should make optimal use of its talent and skills as well as the capital resources in order to manufacture better quality products and services. Therefore, firms are fulfilling their duties and obligations in the society.

Prevention is better than cure

The aim of business organisations is to avoid societal problems. Businesses are perceived as a source of employment for eligible youth with better job opportunities. Thus this reduces large scale unemployment which may cause unrest.

Despite that fact that many advocators of CSR have proposed many reasons for organisations to embark on CSR, the septical school of thought have left no stone unturned in analysing the other side of the coin for instance Reich (2007) pointed out that CSR :

Play with shareholders money

It act as a slideshow

It encroaches upon the functiond of the government

In addition to, in a study carried out by Craig (1990), it has been stated that there is the presence of competitive disdavantage as far as Corporate Social Responsibility is concerned. The latter maintained that beacause organisations have to pay a price for embarking on social actions, this will lead to competitive disadvantage

2.2.6 Overview of CSR in the Mauritian context

According to the European Commission, the corporate social responsibility is defined as a concept in which organisations emphasis on both the environment and society when doing business operations. Special concern is given to different stakeholders interest. Since CSR is said to encapsulate the interest of different structure of the society in terms of the environment, ecology, economy and social enhancement, it is obvious that it is gaining more and more importance. Obviously the Mauritian government cannot lag behind for this reason CSR has been included in the Mauritian law which is mandatory (NEF 2011).

For instance in the June/December 2009 budget emphasis has been laid upon CSR initiatives in which all profitable firms are required to spend 2 % of their annual book profits towards some well-defined CSR activities. These schemes are approved by the Government to be used in the fight against poverty and contribute to the development of the island.

The Mauritian guidelines on CSR proposed the following objectives that organisations can follows:

Encouraging organisations to properly manage their programmes which influences the socioeconomic wellness and the environmental development

Enable organisations’ contribution in order to support National Programmes

Promoting the NGOs community by proposing workplans that are needful for the development of programme

2.2.7 Culture and tradition of voluntary social engagement

Private enterprises in Mauritius have a long cultural and traditional way of viewing CSR, particular emphasis is laid upon voluntary social engagement in the communities. Previous survey reports published by the MEF in the year 2006 and 2009 respectively indicated that Mauritian businesses in their large majority believe that their role in society extends beyond wealth generation and that "pursuing economic interests needs to be balanced with social and environmental responsibility". Mauritian enterprises, driven primarily by ethical considerations, employee motivation, brand positioning and company reputation, are engaging in both internal CSR, undertaken for the benefits of employees, and external CSR initiatives, to develop and support community related activities. The MEF Surveys have also shown that CSR has followed a rather philanthropic approach, characterised by ad-hoc activities, unrelated to business operations and strategy.

2.2.8 Mauritius Employee Federation (MEF) role

The MEF has a fundamental responsibility in channeling the CSF Fund from private firms to social, economic and environmental enhancement of the Mauritian society. Henceforth, this new CSR regulation obliges Mauritian enterprises to adopt ethical and responsible business practices and to reinforce corporate citizenship between oraganisations. The MEF is considered to be a crucial aspect of the UN Global Compact (UNGC) in Mauritius. The UNGC is the world's biggest voluntary corporate citizenship scheme and it one of the most renowned frameworks for CSR. The federation on a regular basis hosts a CSR-UNGC Committee in order to talk about issues dealing with CSR and the Global Compact Network Mauritius. The main goal is to support the UNGC members by paying special attention and encouraging collective action.

2.2.9 Emergence of CSR movement

In Mauritius, CSR projects have started 20 years ago. Since the 1980s, the MEF instilled the notion of social responsibility among business enterprises to achieve societal objectives as in the ‘Code of Practice for Enterprises’. According to a recent report published by Grewal et al (2012) (2008), it was advocated that CSR activities started at varying points of time. When business organisations participate in CSR projects, this is very beneficial both for the employees and for the wider community. The 2006 MEF Survey on CSR depicts that ethical considerations do have a prime importance when firms are acting socially responsible also they need to sustain a good image by constructing an engaged and inspired workforce (MEF, 2008).

The MEF is committed to promoting the social role of enterprises thereby enhancing their contribution through CSR. This is been carried out through poverty alleviation in order to promote the expansion of environmental and social issues. This Federation is involved in many activities regarding CSR, which is the MEF CSR fund.( Refer to Appendix 9)

The MEF CSR Fund

The Mauritius Employers’ Federation CSR Fund was set up in March 2010 and its primary objective is to:

To properly execute CSR programmes in order to better address environmental issues and socio-econimic problems that the organisation and the country may face.

To encourage CSR for the private sector to effectively contribute to sustainable development

Promote participation of private enterprises more specifically in the SMEs

Encourage collective action among private sector enterprises

Guarantee a better management and synergy within the private sector

Cultivate positive affiliations between the three parties that is the public sector, private organisations and also the civil society

Poverty Alleviation

In Mauritian society, the business sector plays an important role in the poverty battle specially with the emergence of CSR legistation. It goes without saying that the society expects a lot from these profitable organisations. As such businesses organisations are expected to respect and comply with ethics and norms of the society (Caroll, 1999). Organisations are now perceived as having social obligations beyond obeying the law and providing the goods and services that its customers want, at a price they are willing to pay. Companies are in fact realising that CSR connot be merely be considered as a cost since it can be an infinite source of competitive advantage and opportunity and it also gives room for innovation (Porter and Kramer, 2006).

There are presently some 6,000 voluntary organisations enrolled with the Registrar of Associations in Mauritius. However, most are community-based associations, which are mainly ethnic or special interest based, and not really engaged in development work. Some 300 organisations correspond to the characteristics of an NGO (SNSM, 2007). The Mauritius Council of Social Service (MACOSS) which was founded in 1965 following the need for a social service coordinating body, has over time developed as a council of NGOs dedicated to social services and sustainable development. There are presently 236 organisations registered with the Council and, of these, 110 are reported to be actively engaged in the fight against poverty.

It is important to note that the business sector is laying much emphasis on the importance of social engagement. For instance, the leading bank in Mauritius, the Mauritius Commercial Bank (MCB), has pledged 1 per cent of its profits before tax (£460,000) for social developments and even Barclays Bank has committed Rs £400,000 in the fight against AIDS. Through its national body, the hotel industry has contributed some £800,000 for community projects, and the association has recommended that its members increase their CSR budget to 2 per cent of net profit by 2009. What is even more interesting is that 92 per cent of the MEF members surveyed recognise that Mauritian enterprises are not doing enough in terms of CSR, although they do expect business involvement in social activities to increase in the future (MEF, 2007).

Chapter 4: Research Methodology

4.0 Introduction

This chapter focuses on how data has been collected and subsequent tests such as Pearson Chi Square Test, Descriptive Statistics, Mann Whitney Test and Cronbach's Reliability Test have been used for the purpose of this thesis. The methodological approach highlight areas such as objectives of the research, sample size, data collection process, analysis and interpretation of data collected and difficulties encountered. Haralambos (1995) pointed out in his studies that, methodology is concerned with detailed research methods and philosophies upon which data is collected and analyzed.

4.1 Research Objectives

The ultimate objective of the study is to assess the overall CSR agenda of MS and how the latter is fulfilling its social duties and contributing to the society. The research objectives are as follows:

To evaluate how the organization caters for the local surroundings

To apply Carroll Pyramid within the CSR system of the firm

To assess employees philosophy and involvement in CSR

To examine sustainability of CSR initiatives (conducted through the interview)

4.2 Survey Research Method

Saunders et al. (2007) argued that survey strategy allowed researchers to collect data quantitatively for descriptive and inferential statistics. Data gathered under this strategy are tested to identify if there are potential association or relationships between those variables.

Surveys are anonymous, flexible, less expensive and have access to large number of people. There was no obligation for a participant to complete the survey and if after reading the information sheet they do not wish to participate, that was also accepted.

4.3 Data Sources

A combination of two methods has been used to avoid non-biased perspectives. Data has been collected using both secondary and primary sources to gather quantitative and qualitative data on CSR awareness, processes and practices.

Primary data

According to Zikmund (2003), primary data is collected particularly for research project at hand. For the purpose of this research, data has been collected through written questionnaires, online surveys and a face-to-face interview was conducted with one of the person from the CSR department of MS.

Secondary data

Secondary data comprise both of qualitative and quantitative because they are mainly used in both explanatory and descriptive research (Saunders et al 2007). Other secondary sources such as company’s web sites, press reports, company’s business magazine and publications have been consulted to supplement additional information.

4.4 Data Collection

Data collection was undertaken through paper based questionnaires and mail surveys. This method is very practical at collecting large amount of data over a relatively short period. Data obtained were highly reliable since each respondent answered the same question in the same order.

4.4.1 Sample

It has been highlighted that the occurrence of errors is minimized when the sample size is large enough (Saunders et al 2007). Thus, to be more accurate and to tap in the maximum number of employees, 75 questionnaires were distributed to employees of Manser Saxon. (Refer to Appendix 7).

4.4.2 Mail Surveys

One main reason to opt for online questionnaire was that it was cost effective in administering the survey. Respondents were allowed to fill the online questionnaires at their own convenience as they were mailed the URL of the survey. As such, they had to click on the following link to start the survey:

http://runtime.quicksurveys.com/tqsruntime.aspx?surveyData=HDlIMWxgdT8x9vykpIS9hq+WmRaEi9VfkXU+MudkaTw=

However, response rate from the online survey was low because mail questionnaires are not considered as the best vehicle for open-ended responses.

4.4.3 Interview

Interviews are perceived as a tool for collecting primary data in qualitative methodologies (Cooper and Schindler 2008). An in-depth face-to-face interview was held with one member from the CSR department, Mrs. Rose Marco. The interview was carried out with to examine the last objective of this study, that is, to examine sustainability of CSR initiatives. The interview questionnaire consisted of 18 questions which were analyzed in view of getting more insight on CSR practices of MS. The face-to-face interview was primarily guided by open-ended questions. This tool also permitted to ask more complex and follow-up questions which was not possible in the questionnaire. A copy of the interview questionnaire has been attached in Appendix 8.

4.5 Questionnaires

According to Saunders et al (2003), respondents are given similar category of questions because the setup of questions follows the same order in all questionnaires. Respondents filled the questionnaire without any difficulties. Large amount of data have been collected in a relatively short period. Furthermore, the quantitative data gathered were used to test hypotheses and to meet the study objectives.

4.5.1 Questionnaire Design

Particular attention was attributed in the structure of questionnaire especially in the flow and type of questions used. The questionnaire consisted mainly of close-ended questions because they are quick, easier to code and due to respondents’ time constraints. These questions offered a wide variety of alternate responses from which respondents could choose their answers.

A brief description on CSR was given on the front page of the questionnaire to help respondents in better answering the questions. The confidentiality aspect was repeated again to ensure that questions were answered without any hindrance.

Section A: General Questions

Section B: Application of Carroll Pyramid

Section C: Employees involvement in CSR activities

4.5.2 Schedule of Questions

In this context, a schedule of questions was developed to provide a range of responses that would meet the purpose and objectives of this study. Different types of questions have been used but the main ones are namely; Likert style format, close-ended, open-ended, dichotomous questions amongst others.

Two five-tiered Likert scale questions have been used to identify the opinions of respondents (Aaker, Kumar and Day, 2005). The rating scales provided respondents with statements and were asked to indicate how far they agreed, disagreed or were indifferent on those statements.

The questionnaire also included dichotomous questions where respondents had to answer either by ‘Yes’ or ’No’. These questions were accompanied by open-ended questions which invited respondents to better explain or justify their answers.

4.5.3 Pilot Survey of Questionnaire

According to Walliman (2005), a pilot study helps to determine inconveniences that may occur while preparing a particular questionnaire. In this thesis, a pilot survey was carried out with one employee from CSR department of Manser Saxon to test:

Validity and reliability of the questionnaire

Suitability of the data collection method

Feasibility of the questions

Make sure that information was not missing

4.5.4 Distribution and collection of questionnaires

Employees and managers filled the questionnaires that were accompanied by a covering letter, which informed them the purpose of this survey and reassured them about confidentiality.

4.6 Response Rate

The responses received were very positive, as out of the 75 questionnaires, 60 completed the survey. The overall response rate for the data collection exercised therefore stands at 80 per cent. Based on the analysis of information collected, it was possible to analyze to the extent to which the MS is acting in a socially responsible manner.

4.7 Analysis of data

After collecting the required information, software such as SPSS (Statistical Package of Social Sciences) 16.0 and Microsoft Excel were used for assembling and analyzing the collected data.

4.8 Data Entry and Coding

SPSS has been used to convert the data into statistical form to ensure the effectiveness of coding when the analysis was done. Data collected were used to calculate frequencies, cross tabulation and derive relationship between variables. For example, in the case of the Likert scale question (Question 4 and 23), numbers were assigned to responses to ease processing and retrieval of data. The response scale used was: 1-Strongly disagree, 2-Disagree, 3- Neutral, 4-Agree and 5-Strongly agree.

Hypotheses Testing

Evidence from Cooper and Schindler (2008) study demonstrated that a statement for an observable fact or event that is classified as either true or false is identified as a proposition. When propositions are applied in empirical testing, therefore this is recognized as a hypothesis.

Null Hypothesis: Here, the operation of the null hypothesis is to demonstrate that there is "no difference" or "no relationship between these two variables"

Alternative Hypothesis: A form that states the hypothesis is accepted if the null hypothesis is rejected. In other words, this is usually what a person hopes the results will show.

In this study, two hypotheses were tested to assess whether there is an association or relationship between two variables and they are formulated as follows:

Hypothesis 1

For this hypothesis testing, the Pearson R correlation test is used to find if there is a relationship (Question 16[iv]) "Being ethical & meet social obligation" and (Question 10) "Firm competitive advantage".

The following hypotheses have been tested:

H0: There is no relationship between "Being ethical & meet social obligation" and "Firm competitive advantage"

H1: There is a relationship between "Being ethical & meet social obligation" and "Firm competitive advantage"

Hypothesis II

The second hypothesis that has been tested is to know whether there is an association of variables between (Question 24[a]) "Current CSR practices" and (Question 24[b]) "Beneficial effects"

The following hypotheses have been tested:

H0: There is no association between the two variables

H1: There is an association between the two variables

4.10 Limitations

Limitations encountered in the research process:

No external verification was made with the stakeholders of the company

Most of respondents had to fill it quickly due to time restrictions

Pressure of their workload may have some impact in the way they answered the questions

Little time available to perform analysis

Respondents reluctant to participate

Bias information from some participants

Limited time available to learn full usage of SPSS Software

Chapter 5: Analysis and Findings

5.0 Introduction

This chapter helps in meeting the objective of the research, which seek to explore the nature and scope of CSR activities at MS. The results obtained from the data gathered are illustrated in the form of charts and tables. Detailed tables generated from SPSS software are contained in Appendix 10. To supplement the analysis, the interview questions from Appendix 8 have been thoroughly examined and have been merged in the study to get a better insight on the extent to which MS is acting in a socially responsible manner.

5.1 Analysis of Demographic Profile (Section A)

In the first level analysis, the demographic profile of the respondents is given. The analysis is related to question 1, 2, and 3, which represents the following variables namely, gender, age and length of service within the company.

Question 1: Gender

Figure 5.1.1: Percentage of Respondents as per gender

As shown in the pie chart, the percentage of respondents from the male group was 42% while the female group represents 58% of the sample surveyed.

Question 2: Age Group

Figure 5.1.2: Percentage of Respondents as per Age Group

The age variables had been grouped into 5 ranges. As depicted in the above figure, the highest number of respondents was from "18 - 25", representing 47% of the population. The age group "26 - 35" represented 35% of the sample while the age group "36 - 45" was only 12% of the sample. Only 7% of the population consisted of respondents between "46 - 55". There was no respondent from the range "above 55" in the sample.

Question 3: Length of Service

Figure 5.1.3: Length of Service

As depicted in figure 5.1.3, 65% of respondents had a length of service of "less than 5 years". It can be noted that 28% of the population had a length of service between "5 to 10 years" while that of "15 to 20 years" was only 7%. In addition, there were no employees with more than 20 years of service in this sample.

5.2 Application of Carroll Pyramid (Section B)

One of the objectives of this study is to examine whether Manser Saxon CSR activities are consistent to that of Carroll Pyramid. As stated by Visser (2007) developing economies do not allocate CSR funds in the same manner as depicted by Carroll Pyramid. Consequently, it would be clear that the ranking of responsibilities for MS would not be similar to that of Carroll Pyramid because Mauritius is a developing country.

Economic Responsibilities

Businesses prefer to invest in their employees because the latter can generate economic value while performing their jobs. Evidently, this enables a firm to maximize its profits. Therefore, this result is consistent with that of Friedman’s (1970) theory as he pointed out that organizations engage in CSR practices because of the profit motive.

Question 13(a)

Figure 5.2.1: Company’s responsibility towards employees

Out of the sample, 84% of respondents believed that MS is fulfilling its responsibilities towards the employees.

From the interview questionnaire (Appendix 8, Question 5), it has been noticed that outdoor activities such as climbing Le Pouce and hikes in Riviere Noire are organized. These recreational activities foster well-being of employees. Subsequently, these welfare programs are essential in developing a positive relationship between the enterprise and the employees. In addition, scholarships are provided to employees who wish to pursue their further studies. Thus, Manser Saxon fulfills its responsibilities towards its employees as it has a career development plan.

Question 13 (b)

Figure 5.2.2: Degree of Success

From the above figure, 83% of respondents felt that MS responsibilities towards the staff was "successful" while only 17% of the sample classified the company’s responsibility as being "very successful".

Question 14

Figure 5.2.3: Facilities provided to employees

From figure 5.2.3, 88% of respondents categorized "Salary & promotion opportunities" as being in the first place followed by "Sponsorship of employee education" with 87% of respondents. From the survey, "Health & Safety Programs" took the third position with 83% participants who opted for this facility. Lastly, 75% of the sample surveyed chose "Training & skills opportunities" to be on the sixth place. It can be observed that no one chose "Access to internal library & documentation".

Competitive salaries, fringe benefits, training and development opportunities are considered as motivational factors for employees (Berman 2006). Further to that, Baptiste (2008) stated organizations can be lucrative and efficient by taking into consideration employee welfare. For example, MS invested in "Health & Safety programs" because such a facility is regarded as a core element for successful running of MS.

In their studies, Armstrong & Stephens (2005) pointed out that employee benefits are arranged by the company in order to increase employees’ welfare. Furthermore, Ivancevich (2007) described benefits as indirect financial compensation. Evidence from Giri (2008) suggested benefits such as medical facilities and sponsorship of employee studies motivate staff members to concentrate more on their works. It can be highlighted that an enterprise trains its employees with the main objective of adding value to the people it employs. Effective training leads to increase in quality, productivity and performance.

Henceforth, when MS sponsored employee’s studies, consequently there has been an improvement in competence of those people. As mentioned by Armstrong (1999) such kind of facilities cultivates a positive environment thereby boosting up employee satisfaction.

Ethical Responsibilities

By doing what is right and avoiding harm, a firm is considered to assume its ethical responsibilities. When an organization abides by expectations, norms or standards this implies the business enterprise is concerned and protect rights of shareholders, society, customers and employees (Carroll 1991).

Question 16

Figure 5.2.4: Shift in Role of the Business

From the table, it can be that 75% of the respondents felt that the direction of the business has shifted to a more profit-oriented one. It can be observed that only 23% of participants have chosen high competitive while the largest percentage 77% of respondents believed that their business was fairly competitive. 73% of the participants believed that MS provide a reasonable customer satisfaction.

On the other hand, only 27% of the sample considered that MS provide very high customer satisfaction. As illustrated from the table, 37% of respondents felt that the MS role of has shifted towards "being ethical and meet social obligation".

Question 17

Figure 5.2.5: Ethical awareness among staff members

Ethical behavior is promoted when Code of ethics is applied and as depicted from figure 5.2.5, the majority of respondents with 92% have chosen "Code of ethics". Therefore, it can be highlighted that Manser Saxon is considered as an ethical organization. In other words, MS caters for the society as well as its employees.

For instance, results obtained from Question 9 from the interview (Appendix 8) denoted that MS acts as a watchdog of the in the area in which it operates. Sustainable business practices are adopted to ensure MS meets its environmental obligations. Particular attention is attributed to environmental considerations because the business operates on the principle of sustainable development such that:

Water recycled for irrigation purposes

MS ensures trees replantation whenever it purchases its supply of woods

Business ethics plays a vital role in the business world as it refers to the principles and standards that determine acceptable conduct in business organizations. Therefore, MS lays significant importance on ethical responsibilities because it creates trust and confidence between among the different stakeholders.

Question 18

Figure 5.2.6: Equal access to employment & promotion

Figure 5.2.6, clearly depicts that 78% of participants felt that there is equal access to employment & promotion. Equal treatment is in fact a form of social responsibility where tension and conflicts are avoided at work.

Legal Responsibilities

In order to be socially responsible business entities are bound to comply with company laws and regulations set by the government. Evidently, companies have to follow to this type of obligation in order to be known as socially responsible.

Mauritian government has passed a law whereby all profitable firms are required to spend 2 % of their annual book profits towards well-defined CSR activities. Such schemes are used to fight against poverty and contribute to the development of the island.

Question 19

Figure 5.2.7: Ranking of statements

30% of respondents strongly agreed that MS often performs social obligations that go beyond the existing legal obligations.

As demonstrated in the chart, most of the respondents agreed that Manser Saxon adheres to the principles of rights, actions and "no harm". In fact, 44% of sample strongly agrees to this statement.

As illustrated in the figure, the response rate for neutral was 61% implying that majority respondents were indifferent on the statement "conducting business in a socially responsible manner far outweighs short-term costs".

As depicted in figure 5.2.7, 41% of sample was indifferent with the view that CSR could benefit the company in both financial and moral terms.

From the figure 5.2.7, 8% of respondents agreed that the company could not meet community needs without apparent business benefits. While at the other, extreme 11% of participants strongly agree with the statement.

When analyzing Question 17 from interview statement (Appendix 8), it can be observed that MS often goes far more than its minimum legal requirement. In fact, the CSR fund comes partly from Manser Saxon profits and more precisely from IBL foundation as the latter provides a budget allocation for social projects.

Question 20

Figure 5.2.8: Company doing its best regarding CSR activities

From figure 5.2.8, it can be clearly seen that 83% of the respondents believed that the MS is doing its best regarding CSR activities. On the other hand, 17% of the employees are against the view that organization is fulfilling its social obligations towards the local community and people.

Additional information has been acquired from the face to face interview with reference to Question 12 (Appendix 8) concerning legal problems encountered by MS for the food distribution program. During a certain period, the food distribution program was not yet codified at the ministerial level and that program was one of priority area for MS.

Thus, MS had some difficulties for implementation of the food distribution program as government authorities did not provide its assistance immediately. MS had to justify the reason for such a program and today the same food distribution program has been codified at ministerial level.

Question 21

Figure 5.2.9: Evaluation of services offered by the company

The majority of respondents 83% were satisfied with the services offered by MS as shown in figure 5.2.9. Out of the remaining respondents, 17% believed that the services rendered need to be improved. No respondents perceived the services to be outstanding.

Philanthropic Responsibilities

It is interesting to highlight the fact that in developing countries firms consider them as socially responsible by engaging in philanthropic activities (Visser 2006). In other words, there is much social involvement in areas such as health, education, environment and other community services are attributed highest degree of importance.

Question 22

Figure 5.2.10: Involvement in CSR Activities

As depicted in figure 5.2.10, MS was actively involved in CSR deeds. The social aspect was selected by 36% of respondents, followed by 32% of respondents who opted for "Environment". "Health & Safety" and" Ethical" were choose by 15% and 17% of participants respectively.

MS gave philanthropic responsibility most priority because the business is located in relatively poor regions and MS duty is to enhance well-being of the community. Thus, MS choose diverse fields for instance education, employee welfare, local community and heath & disable to implement its CSR programs.

By analyzing the philanthropic duties of Manser Saxon the following key issues have been observed from the interview conducted (Refer to Appendix 8).

Question 2:

The CSR principle has been adopted by MS since it is located in poor areas such as Roche Bois, Bois Marchand and Ste Croix. Therefore, this is an opportunity for the organization to assist adults and children in priority areas such as food distribution, healt