The role of corporate social responsibility in promoting growth in Small and Medium Enterprises (SMEs) in the hospitality sector in Pietermaritzburg

Abstract

There is a consensus about SMEs being key to the growth of most economies in Africa and the world in general. SMEs have been branded as fecund drivers of economic growth and sustainable development in South Africa and the world at large. The existence of SMEs in any economy is of paramount importance despite them bullied by large corporations. There is growing recognition of the important role SMEs play in economic development. SMEs often described as efficient and prolific job creators, the seeds of big businesses and the fuel of national economic engines with much hype on their ability to create employment. Research on Corporate Social Responsibility in SMEs is limited, especially in developing countries. Considering Hospitality sector in Pietermaritzburg Municipal region, corporate social responsibility has been growing greater importance in the minds of businesses. Given the enormity of the South African economy, social responsibility for business took centre stage during the socio-economic turbulence experienced in the country. While playing such a significant role in the economy, to address this, the study will investigate perceived effectiveness of Corporate Social Responsibility as a stimulant of growth for SMEs in the service sector in Pietermaritzburg municipal area. The research shall consider the convenience and purposive sampling as sampling strategies. It will employ a sampling design where participants are conveniently but purposively selected on a volunteering basis. The quantitative approach will be used where a questionnaire is going to be used to obtain and analyse primary data. The study will make use of numeric data making use of descriptive research design to drive results and conclusions. This shall be done by assessing the attitude levels of Hospitality SMEs towards corporate social responsibility; the practice of corporate social responsibility by hospitality SMEs; exploring barriers undermining the practice of corporate social responsibility by hospitality SMEs; and exploring SME owner-managers‘ values key to the sustainable growth of the business. This study aspired to expand and contribute significantly to the body of knowledge regarding CSR by examining CSR on sustainable growth of hospitality SMEs in Pietermaritzburg Municipal region. As new knowledge, the study proposed a model based on the Stakeholder Theory which is meant to assist Hospitality SMEs in Pietermaritzburg Municipal region to apply positive attitude towards embracing CSR in their businesses. However, the study recommends that local authorities and chambers of commerce must play a leading role in awareness and support mobilisation to try and motivate hospitality SMEs to practise CSR. In addition, it is recommended that the phrase ‗Corporate Social Responsibility‘ should be re-phrased as ‗Small Business Responsibility‘ or generally ‗Business Responsibility‘ as a way of contextualising the whole responsible business idea, promote and refer to the social responsibility of SMEs. The phrase simply drives SMEs to think that they are excluded from the practice because of their size. The concept Corporate Social Responsibility imposes a challenging journey on SMEs it is psychologically intimidating to SMEs, hence resistance to the practise of CSR.