Exploring the role of the theory of planned behaviour, risk orientation, and participative leadership in SME managers' engagement in CSR.
| Autor | Tan, Athirah Mohd |
1 Introduction
Small and medium-sized enterprises (SMEs) play a crucial role in the development of developing nations due to their significant contributions to job creation and economic growth (Zou et al., 2021). Additionally, with more than 90 per cent of companies worldwide being SMEs, which provide between 50 and 60 per cent of global employment, they serve as a vital component in the implementation of corporate social responsibility (CSR). While most studies on CSR have focused on larger enterprises (Youssef et al., 2018), it is essential to recognize the importance of CSR engagement in SMEs. In fact, CSR should be a top priority for SMEs, given that their major customers are increasingly demanding ethical standards of behaviour from their suppliers, thereby exerting pressure on smaller businesses to act responsibly. Moreover, research conducted on large companies suggests that CSR can be a strategic tool to enhance a firm's competitiveness (Sadou et al., 2017). Although literature findings indicate a lack of CSR engagement among SMEs (Aras-Beger & Tackm, 2021), applying CSR in small firms can lead to positive outcomes such as improved organizational culture, employee attraction and retention, enhanced firm image and reputation, customer loyalty, and stakeholder satisfaction (Pastrana & Sriramesh, 2014). Therefore, there is a need to pay more attention to understanding the specificities and contributions of SMEs in relation to CSR (Saveanu et al., 2021).
Most studies in the field of CSR have focused on large companies rather than SMEs (Saveanu et al., 2021), mainly due to the availability of greater resources, visibility and cases of irresponsible behaviour often associated with large multinational companies. Previous studies have not examined SME managers' intentions to engage in CSR activities and whether such intentions translate into actual engagement in CSR activities. This is particularly the case for SMEs in developing countries due to the limited availability of published data on this group of businesses (Jamali et al., 2017). However, the main decision-makers in the organizations are often responsible for corporate social responsibility (Saveanu et al., 2021), and when it comes to SMEs, the owners' or managers' goals drive their participation in CSR-related activities. Therefore, it is relevant to seek answers to the question of what drives these owners' or managers' intentions to engage in CSR activities and whether such intentions translate into actual behaviour. With this in mind, the main objective of this study was to examine the antecedents that influence SME managers' behavioural intentions to engage in CSR activities and whether such intentions lead to actual behaviour. By utilising Ajzen's (1991) Theory of Planned Behaviour, which offers a well-established framework for understanding peoples' behavioural intentions, our study is able to accomplish its research goals.
There has been limited research on the impact of subjective norms and perceived behavioural control on CSR behavioural intentions (Feder & Weissenberger, 2019), despite the fact that attitude towards behaviour has often been reported as the strongest predictor of intentions to carry out a certain activity (Feder & Weissenberger, 2019). This study addresses this gap by examining the influence of both perceived behavioural control and subjective norms in explaining CSR intentions among SMEs.
Additionally, our study seeks to explain how risk orientation and participative leadership affect managers' attitudes towards corporate social responsibility. While many previous studies have focused on transformational and transactional leadership styles (Raub & Blunschi, 2014), there have been few published papers on other types of leadership styles. Participative leadership is a highly suitable leadership style for small and medium-sized enterprises (SMEs) due to its effectiveness in fostering organizational commitment, job satisfaction, job performance, organizational citizenship behaviour, and team innovation (e.g. Chen et al., 2011; Huang et al., 2010; Miao et al., 2014). Participative leadership can be particularly effective in small and medium-sized enterprises as it promotes interpersonal interaction among group and organizational members (Yan, 2011). This leadership style also encourages subordinates to participate in decision making through formal or informal meetings, which improves communication, fosters collaboration, and facilitates conflict resolution (Yan, 2011). Furthermore, participative leadership can help build a sense of trust and collaboration within the organization, which is particularly crucial for small and medium-sized enterprises that depend on close-knit teams and interpersonal relationships (Carson et al., 2007).
Despite the growing interest in CSR activities among SMEs, previous research has largely neglected the role of risk orientation in shaping the attitudes of owners or managers towards CSR activities (Rashidi Baqhi, 2020). While studies on the relationship between risk and CSR have primarily been conducted in the context of large multinational corporations (Huang & Liu, 2021), it is unclear whether the findings can be generalized to SMEs. This is particularly relevant since most business cases on CSR and risks have been mainly developed for larger companies. However, previous research has indicated that risk tolerance can significantly impact an individual's attitudes towards specific behaviours (Waddock & Graves, 1997). SMEs are known for their limited resources and higher levels of risk compared to larger organizations (Jamali et al., 2017), so it is crucial to investigate how risk orientation affects the attitudes of SME managers or owners towards CSR activities. Moreover, previous research has linked CSR to firm risk (Albuquerque et al., 2019), highlighting the need to examine how SME managers' or owners' risk orientation influences their intention to engage in CSR activities.
This study aims to make four contributions. First, most existing studies on CSR in SMEs have merely analysed the intention to engage in CSR (Stuart et al., 2021), while overlooking actual CSR behaviour, which is important as the effectiveness of CSR activities hinges on the actual activities implemented by the firms. Second, this study investigates how the intention to engage in CSR activities is affected by the manager's attitude towards CSR activities, subjective norms and perceived behavioural control. According to Ajzen's (1991) Theory of Planned Behaviour, a person's intention to perform a certain behaviour is influenced by their personal beliefs, social pressures, and the perceived ease or difficulty of performing the behaviour. Furthermore, the strength of a person's intention to act is a key factor in determining whether they will actually perform the behaviour. Hence, the findings of this study will provide a better understanding of the factors that influence SME owners' or managers' intention to engage in CSR activities. Third, this study investigates the influence of risk orientation and participative leadership on attitudes towards CSR activities. Participative leadership is a relatively new area of study in the field of leadership research, and it remains an important construct that needs more investigation (Martin, 2015). Furthermore, by testing the relationship between risk orientation and CSR activities, this study contributes to the CSR literature because it seeks to identify a possible new antecedent of CSR engagement among SME managers. Finally, insights gained from the findings on the type of CSR activities can provide valuable suggestions for SMEs to prioritize the activities that warrant more attention in order to increase their CSR engagement.
The paper is structured as follows. The existing literature is reviewed in the next section, which also contains a discussion of the research hypotheses. Section three then presents the findings following a description of the research methodology. Section four concludes with a list of this study's limitations and some suggestions for additional research.
2 Literature review and hypothesis development
2.1 CSR and SMEs
Research on corporate social responsibility (CSR) has increased over the past decade as many companies have started to identify the importance of CSR to their business (Bhattacharyya & Verma, 2020). The area of research has since expanded to include various CSR issues relating to the environment (Kang et al., 2016), the economy (Chakraborty & Jha, 2019), socially responsible production processes, corporate social marketing (Kim & Austin, 2019), and philanthropic programmes (Mishra & Schmidt, 2018). While it has been suggested that CSR can lead to improved financial performance in SMEs (Jain et al., 2016; Bahta et al., 2021), previous research has discovered several potential reasons for SMEs' reluctance with regard to CSR, such as the widespread belief that environmental and social problems are global issues and beyond the responsibility of smaller firms (Brammer et al., 2012), the resources, knowledge and technical constraints of SMEs (Nunes et al., 2019), or cost concerns (Dincer & Dincer, 2013).
2.2 Research framework
This study aims to extend the current understanding on owners' or managers' CSR intentions and behaviour by using the Theory of Planned Behaviour (TPB). According to TPB, attitudes towards behaviour, subjective norms and perceived behavioural control affect the reason and motivation for engaging in a behaviour. According to TPB, an individuals' attitude towards a certain behaviour is a major component by which behavioural intention is determined. Attitude refers to the extent to which an individual holds a favourable or unfavourable evaluation of a particular behaviour, considering the expected outcomes of performing that behaviour. If an individual believes that a certain behaviour will lead to positive outcomes, they...
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