CSR and Competitiveness European SMEs - KMU Forschung Austria

2 CSR and Competitiveness - European SMEs’ Good Practice - Consolidated European Report
Nevertheless, there exists a range of favouring and hindering factors influencing SMEs’
decision making process as regards their involvement in CSR. These may be classified as
follows:
• The strategic orientation of the company can be seen as the main pre-proposition.
Generally, SMEs’ owner(s) or their management teams dispose of a comparatively high
feeling of ethical obligation to “behave correctly” in their business decisions, i.e. to
benefit all relevant stakeholders (not only the shareholders). This is often fostered by
longstanding company traditions and/or the expectations of clients, business partners or
the society as such (to which SMEs are often more densely linked than larger enterprises).
• Nevertheless, for the majority of SMEs to become active in the field of CSR an
operative impetus is necessary. Such may come in the form of inquiries of potential
beneficiaries, business partners or consultants or may be triggered by the participation
in public support programmes, for example.
• This decision making process is influenced by general framework conditions prevalent
in the country/region, such as legal regulations, the extent of public or policy
discussion on CSR or the national economic development affecting businesses’
activities.
• Furthermore, also the micro perspective of the enterprise characteristics determines
its business decisions and, therefore, also its CSR decisions. As to this regard, structural
characteristics (such as the industry, the location, the phase in the company life
cycle), the enterprises endowment with human and financial resources or its familiarity
with CSR and the relevant national/regional/local actors may be mentioned as
examples.
SMEs’ CSR activities are mostly based on ad-hoc decisions and often conducted in an
occasional way not formally anchored to the overall business strategy. Nevertheless, the
analysed case studies have shown that SMEs that have experienced a positive economic
outcome of their CSR activities are willing to further continue their efforts or even expand them.
This may, however, sometimes be impeded by the fact that there hardly exists a single person
being responsible for the planning and implementation of CSR activities within the enterprise.
Furthermore, a systematic monitoring of the cost-efficiency ratio of CSR activities can only
be rarely observed among SMEs. This may indicate that SMEs are not always fully convinced of
the impact of socially responsible acting.
This study, however, clearly pinpoints that there exists a relationship between SMEs’ CSR
activities and their enhanced competitiveness – at least if a long-term perspective is considered.
Thereby, direct (such as improved products or production processes), intermediate
(such as a higher customer satisfaction or a better networking with business partners or authorities)
as well as indirect effects (i.e. a competitive advantage resulting in an increased turnover
fostering the SME’s competitiveness) may be distinguished. Furthermore, the observable impact
may be internal (i.e. benefiting the company or its employees) or external (i.e. benefiting a target
group outside of the enterprise, such as customers, the society or the environment). Both, the
analysed case studies as well as the available literature have shown that particularly the higher
employee satisfaction, the better publicity as well as the improved customer loyalty attributed to
CSR activities can be seen as an important beneficial outcome of socially responsible acting.