The development and structural confirmation of an instrument for measuring the social responsibility of small and micro business in the African context

Abstract

PURPOSE: The purpose of this paper is to propose an instrument, the Small Enterprise Social Responsibility Inventory (SESRI) for measuring business social responsibility (BSR) in the African venture setting. DESIGN/METHODOLOGY/APPROACH: The approach was to use the components of Dzansi's framework to create an instrument for measuring BSR activities of small ventures that operate in rural Africa. The instrument was tested in a rural community in South Africa for validity reliability structure, and its ability to predict firm performance given performance of certain BSR activities. FINDINGS: Through factor analysis of data obtained from 314 small businesses in a rural South African setting, the instrument was found to be valid for measuring small business BSR and identified five factors: expected benefits; community or customer practices; realised or actual benefits; awareness or attitude and performance; and employee practices. Through discriminant analysis, employee practice was found useful for classifying ventures as high or low sales and profit performers, suggesting that information on a firm's BSR related employee practices may be useful predictors of sales and profit. RESEARCH LIMITATIONS/IMPLICATIONS: Firstly, the methodology requires self-evaluation by the respondents. However, those respondents who reported low levels of BSR activities (and negative growth in sales and performance) also reflected on their own "performance" and recorded it as low signifying some level of realistic reporting. Secondly, there is absence of question items about environmental issues. Thirdly, the sample was taken in a small rural setting, which requires caution when generalising from the results. ORIGINALITY/VALUE: This study provides an African context specific measurement instrument for addressing small business BSR. Academics will find it useful in their research efforts. Fund managers will also find it useful for evaluating small business BSR performance. Owners/managers will have a benchmark in performing their social obligations.