Henry Kimutai Rono, Simon Kipchumba


This study sought to determine the effect of corporate social responsibility (CSR) on the firm performance of small and medium enterprises at Kariobangi light industries, Nairobi. The objective of the study was to determine: how environmental CSR activities, philanthropic CSR activities, economic CSR, and legal CSR activities influence the firm performance of the said SMEs. This study will benefit various groups including top management, the government especially the ministry in charge of industrialization, SMEs practitioners, policy-makers, academics, and future researchers. The study employed a descriptive research design. The target population was the owners/workers of18metal engineering works along with 9 SMEs dealing with paint production and 3 SMEs that deal with chemicals and related accessories within Kariobangi Light Industries. Data was collected by using questionnaire method and it was analysed using descriptive and inferential statistics. For descriptive statistics, the study used frequency, percentages and mean. For inferential statistics, the study used Pearson‚s Correlation Analysis and Multiple Regression Analysis. The researcher established that environmental CSR activities, philanthropic CSR activities, economic CSR, and legal CSR activities influences firm performance of SMEs of Kariobangi Light Industries positively. In turn, the results were further presented in different visual spectrums to encounter the reliability of the entire scope. Study results findings rejected the hypothesis that environmental CSR activities, philanthropic CSR activities, economic CSR, and legal CSR do not have a significant effect on firm performance. The study concluded that there is a positive association between corporate social responsibility and firm performance of the company. From the results obtained the researcher recommended SMEs should continue to engage in corporate social responsibility to yield the benefits associated with corporate social responsibility engagement and further improve its overall performance.

Full Text:



Coase, R. H. (1960). The problem of social cost. Chicago, Ill: University of Chicago Law School.

Coase, R. H. (1988). The firm, the market, and the law. Chicago: University of Chicago Press.

Dowell, G., Hart, S. & Yeung, B. (2000). Do Corporate Global Environmental Standards Create or Destroy Market Value? Management Science, 46(8), 1059-1074.

Elkington, J. (1997). Cannibals with Forks: the triple bottom line of 21st-century Business. Oxford: Capstone.

Garriga, E. & Melle, D. (2004). Corporate social responsibility theories: mapping the territory. Journal of Business Ethics, 53, 51-71.

Ghelli, C., (2013). Corporate Social Responsibility and Performance: Empirical Evidence. MSc Finance & Strategic Management, 1(1), 27-42.

Isaksson, R. & Steimle, U. (2009). What does GRI-reporting tell us about corporate sustainability? The Total Quality Management Journal, 21(2), 168-181.

Marshall, A. (1920). Principles of economics 8th ed. London: McMillan.

Mugenda, M. & Mugenda, G. (2003). Research methods: Quantitative and qualitative approaches. Nairobi: Acts Press.

Mumo, G. (2012). Corporate Social Responsibility and Performance of Selected Airlines Operating In Kenya. Journal of Management Studies, 43(1), 1-18.

Mwangi, A. (2011). The relationship between corporate social responsibility and performance of publicly quoted companies in Kenya. Journal of Management and Public Policy, 2(2), 4-22.

Mwangi, C. I. & Oyenje, J. J. (2013). The Relationship between Corporate Social Responsibility Practices and Financial Performance of Firms in the Manufacturing, Construction and Allied Sector of the Nairobi Securities Exchange. International Journal of Business, Humanities and Technology, 3, 81-90

Mwangi & Jerotich. (2013). Effects of corporate governance on financial performance of companies listed at the Nairobi Securities Exchange. Journal of Emerging Issues in Economics, Finance and Banking. 3(2), 1057-1064.

Nelling, E., & Webb, E., (2009). Corporate social responsibility and firm performance: the virtuous circle revisited. Review of Quantitative Finance and Accounting, 32(2), 197-209.

Ochanda, M., (2014). Effect of financial deepening on the growth of small and medium-sized enterprises in Kenya: A case of Kenya. International Journal of Social Sciences and Entrepreneurship, 1(11), 191-208.

Ondari, O. D. (2013). The Relationship between Corporate Social Responsibility Practices and Performance of Firms in the Commercial and Services Sector at the Nairobi Securities. Corporate Governance Journal, 6(4), 506-515.

Porter, M.E., & Van der Linde, C. (1995). Toward a New Conception of the Environment Competitive Relationship. The Journal of Economic Perspectives 9(4), 97- 118.

Rutto, F. C. & Langat, N. (2012). Effect Of Corporate Social Responsibility On Corporate Identity Of Small And Medium Telecommunication Firms In Kenya, Strategic Journal of Business Change Management, 22, 43-64.

Swanson, D. L. (1995). Addressing a Theoretical Problem by Reorienting the Corporate Social Performance Model. Academy of Management Review, 20(1), 43-64.

Tarus, D. K. (2015). Corporate Social Responsibility Engagement in Kenya: Bottom Line or Rhetoric? Journal of African Business, 16(3), 289‚304.

Theofanis, K., (2010). Corporate Social Responsibility and Performance: An Empirical Analysis of Greek Companies. European Research Studies, 12, 13 ‚ 21.

Waddock, S. & Graves, S. (1997). The Corporate Social Performance‚Performance Link. Strategic Management Journal, 18, 303‚319.

Wagner, M., Van Phu, N., Azomahou, T. &Wehrmeyer, W. (2002). The relationship between the environmental and economic performance of firms: an empirical analysis of the European paper industry. Corporate Social Responsibility and Environmental Management, 9, 133‚146.


  • There are currently no refbacks.