Impact of Corporate Social Responsibility to Firms’ Performance in Southern Enterprises of Vietnam

International Review of Management and Marketing ISSN: 2146-4405 available at http: www.econjournals.com International Review of Management and Marketing, 2020, 10(4), 17-24. Impact of Corporate Social Responsibility to Firms’ Performance in Southern Enterprises of Vietnam Le Thanh Tiep1*, Ngo Quang Huan2, Tran Thi Thuy Hong3 University of Economics and Finance, Vietnam, 2University of Economics, Ho Chi Minh City, Vietnam, 3International School of Business, University of Economics, Ho Chi Minh City, Vietnam. *Email: 1 Received: 06 April 2020 Accepted: 19 June 2020 DOI: https://doi.org/10.32479/irmm.9900 ABSTRACT This study is aimed to evaluate the impact of corporate social responsibility (CSR) on firms’ performance by developing the role of mediating variables such as corporate reputation (CR) and customers’ purchasing intention (CPI). We use qualitative and quantitative technique such as Smart PLS SEM to analyze the data of the corporate in the South of Vietnam in 2019. The findings suggest a positively significant impact of CSR on firms’ performance through mediating role of CR and CPI. This study contributed empirical work in the literature of CSR and firms’ performance. The outcomes of this study can be used by entrepreneurs, top management as an attempt to boost the performance of the corporate. A mediating role of CR and CPI as a value-added contribution to this study and can be strengthened more in future research. Keywords: Corporate Social Responsibility, Corporate Reputation, Purchasing Intention, Firms’ Performance JEL Classification: M31 1. INTRODUCTION The concept of corporate social responsibility (CSR) has been widely considered in the academic field as well as in the business environment in recent years. Organizations are using CSR to develop competitive advantage and establish symbiotic relationships with stakeholders. In developed countries, the concept of CSR is very familiar and the implementation of CSR for businesses is an indispensable activity to maintain the ecosystem for sustainable development, which is good for society, the environment, stakeholders and good for the enterprise. The concept of CSR has gradually become popular in developing countries; However, the implementation of CSR in a business environment is not fully voluntary because the potential benefits of CSR are less emphasized, as in Vietnam. This study examines the impact of CSR on the performance of an intermediary firm’s reputation and customer’s purchasing intention (CPI). Data has been collected from respondents on their perceptions of CSR actions and its impact on customer prestige and purchasing intention, affecting to firms’ performance. The objectives of this study include (1) assess the impact of CSR actions on the development of a corporate’s reputation, (2) measure its impact on CPI, (3) assess the impact of corporate reputation (CR) on CPI, (4) evaluate the impact of CR on the firms’ performance and (5) evaluate the effect of purchasing intention on firms’ performance. The following sections present an overview of relevant literature, research methods, research results, discussions and finally useful conclusions and recommendations. 2. LITERATURE REVIEW 2.1. CSR Measures CSR is an idea of sustainable development, involving different levels of society, from environmental issues to social welfare, education and global warming on the planet (McWilliams et al., 2006; Lai et al., 2010). CSR can include sponsorship, charitable This Journal is licensed under a Creative Commons Attribution 4.0 International License International Review of Management and Marketing | Vol 10 • Issue 4 • 2020 17 Tiep, et al. Impact of Corporate Social Responsibility to Firms’ Performance in Southern Enterprises of Vietnam events and voluntary employees as well as other creative activities (Polonsky and Speed, 2001; Lichtenstein et al., 2004). CSR is an important strategy for businesses in marketing planning. Many multinational corporations urge global businesses to exercise CSR as an essential and essential part of their business (Oberseder et al., 2011; Green and Peloza, 2014). CSR plays an important role in the marketing and branding of a business whereby CSR has gradually become the main topic of marketing. That funding and environmental awareness are more emphasized in CSR (Waagstein, 2011; Oberseder et al., 2014). Participation in CSR activities will bring great benefits to businesses such as image promotion, brand development, increase sales, reputation and change consumer attitudes. (Lai et al., 2010; Groza et al., 2011). However, CSR requires long-term participation and can affect the short-term profitability of businesses. As a result, Asian businesses are more concerned with CSR than participating. Based on academic view, research on CSR changed from “why do it” to “why to do so” to “what is corporate social responsibility” “what cooperation social responsibility is.” After that it is a way to implement CSR, ie pay attention to how companies and society realize the maximization of benefits through joining a CSR (Basu and Palazzo, 2008). production of corporations also harms the environment and the ecosystem. Therefore, enterprises must take responsibility to the community through practical activities to protect the environment and regenerate the ecosystem, which is a major concern of society. Godfrey (2005) believes that CSR is a multi-dimensional structure composed of 3 main parts that aim to (1) help the enterprise operate on a transparent basis (2) to help all decisions to be carefully considered. on the interests of stakeholders and (3) contributing to creating a positive capacity in proactively creating benefits for society in a spirit of voluntary, exceeding society’s expectations and the provisions of law. According to Fombrun et al. (2015), CSR can be assessed through the following measures: product and service quality, innovation and creativity, working environment, compliance, civil rights, leadership and performance, productivity. Although CSR demonstrates corporate responsibility to society, it also implies that the enterprise provide products and services to consumers are increasingly sensitive to taking on more responsibilities for social welfare, environmental maintenance, ecological balance. In fact, the term of CSR has different meanings for everyone, depending on the context and perspective of each person (Saeidi et al., 2015; Van Beurden and Gössling, 2008). According to Ali (2011), since the 1990s, the CSR role of corporations and organizations has been shown more clearly and on a much larger scale than everyone expected. Accordingly, the broader range of CSR they undertake covers business ethics, labor practices, community responsibilities and reducing environmental harms from production activities and communal activities, etc. It is as a strategic action to build and enhance the image of businesses in the community and society. At the same tim (...truncated)