Practice, Barriers, and Motivations of Corporate Social Responsibility (CSR) in Small and Medium Sized Enterprises of Khyber Pakhtunkhwa

Abstract

This study investigated the issue of corporate social responsibility (CSR) in context of small and medium sized enterprises (SMEs) of Khyber Pakhtunkhwa (KP). The study focused on exploring CSR related activities of SMEs in the province and their underlying motivations. Moreover, major barriers faced by SMEs in addressing social, economic, and environmental concerns are identified. Mixed-method research methodology is used in two phases of research. The first phase of the research was based on qualitative study which helped in exploring practices of CSR in SMEs along with motivations and barriers. In-depth interviews were conducted from managers and owners of SMEs. Moreover, through adopting ground theory approach, the rich information from interviews was analyzed to extract emerging themes. Qualitative study helped in exploring six major themes related to CSR practice, three major themes on motivations of the CSR, and two themes on barriers of CSR in SMEs. Furthermore, a questionnaire was constructed based on themes emerged during first phase of the study and a conceptual model was formed with relational hypothesis. In the second phase, quantitative methodology is used to test the validity of developed instrument and hypotheses testing. A randomly selected sample of 469 respondents from SMEs was subjected to analysis. Unifactoriality of the constructs was tested with Principal Component Analysis. The results of tests indicated that items related to each construct correlate with each other and hence provide a sufficient evidence of constructs validity. In order to test the relational hypothesis, structural equation modeling (SEM) technique is deployed. Key Words: Corporate Social Responsibility, SMEs, Motivations, Barriers, Mixedmethod research