Corporate social responsibility and firms’ financial performance: The case of Tanfoam and Zantel in Arusha

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Mzumbe University
The field of Corporate Social Responsibility (CSR) has grown exponentially over years. There are different views of the role of the firm in society and disagreement as to whether wealth maximization should be the sole goal of a corporation. This study focused on the corporate social responsibility (CSR) and firms’ financial performance. The aim of this study was to analyze the outcome of corporate social responsibilities on financial performance of the firms. Specifically, the study aimed to find out the reasons for the companies to engage in corporate social responsibility, to explore types of corporate social responsibilities which are more practiced by the firms and lastly to examine relationship between corporate social responsibilities and firms’ financial performance. The study adopted a case study research design where Zantel and Tanfoam Ltd located at Arusha were selected as units of analysis. Primary data were collected through questionnaire and documentary source such as journals, books and various organization reports for secondary information. A total of 42 respondents were used. With the help of computer software programme called Statistical Package for Social Sciences (SPSS) version 16.0, data collected were analyzed both quantitatively and qualitatively using percentages, mean weight and frequencies followed by interpretation, comparison and explanation from cross tabulation, charts and figures The outcome of the study indicated that the motives to engage in CSR included preserving reputation, employee motivation and give profit back to society. Philanthropic was the main type of CSR mostly practiced. The relationship between CSR and financial performance indicated that companies practicing CSR increased financial performance. Eventually, the study recommends that companies may promote sales, expand the branches in the region which will result into increased amount of profit hence uplift the amount of percentage to be allocated to CSR. Also the researcher suggests that a longitudinal study may be adopted in providing deeper insight into the relationship between CSR and financial performance.
A dissertation submitted in partial to the requirements for the award of the Degree of Master of Science in Accounting and Finance (MSc A&F) of Mzumbe University
Corporate social responsibility, Firms’ financial performance, Marketing, Tanfoam-Tanzania, Zantel-Tanzania