AN ASSESSMENT OF THE CORPORATE SOCIAL RESPONSIBILITY PERFORMANCE IN A PROFIT MAKING ENTERPRISE: THE CASE OF THE MOTOR ENGINEERING COMPANY LIMITED OF ETHIOPIA.

Abstract

The study is an assessment of the Corporate Social Responsibility performance in a profit making enterprise that is, the Motor Engineering Company of Ethiopia Ltd (MOENCO). The objective of the study was to determine if there is any significant relationship between social responsibility cost and corporate profitability in the selected business firm. The study was based on the stakeholder theory of social responsibility which emphasized the need for a corporate organization to satisfy the requirements of various interest groups. Descriptive research design was employed together with correlation method to test the relationship between social responsibility cost and corporate profitability in the MOENCO. The research used both primary and secondary data of the company for a period of five years spanning from 2012 to 2017. The various data are collected through interviews and focus group discussions and the study addressed content validity through the review of the relevant literature. Findings revealed the relationship between social responsibility cost and corporate profitability. Therefore, the study concluded that social responsibility is vital to organizational performance. It is recommended that firms in Ethiopia endeavor to increase their commitment to social responsibility by allocating funds proportional to their income in social responsibility schemes. Business organization should make efforts to organize and assign a responsible section and staff to carry-out and periodically report status to internal and external stakeholders. Government authorities and civic groups should periodically assess the CSR activities of business operations to ensure adherence to various laws and guidelines.