Effect of corporate social responsibility on performance of commercial banks in Busia county, Kenya

Abstract

The purpose of this study was to investigate the effects of corporate social responsibility on the performance of commercial banks in Busia County, Kenya. The specific objective was to determine the effect of economic aspects of CSR on the performance of commercial banks, Busia County. The study was anchored on the Edward Freeman’s Stakeholder Theory. The study employed a descriptive survey and correlational research designs. The target population was 40 employees comprising of Managers, Operational Managers, Financial Managers, marketing managers and Human Resource Managers. Census sampling technique was use to select the entire target population of 40 respondents. The questionnaires and the interview schedules were used to collect primary data. Validity was determined by use of content validity while reliability by use Cronbach alpha. Descriptive statistics and inferential statistics were used to analyse the data collected by use SPSS version 20. The results revealed that economic CSR aspects had significant positive effect of the performance of commercial banks in Busia (Economic=0.875**, P<0.01) and it accounted for 76.5% variance in performance. The study recommended that bank management should priorities CSR activities in their institutions and ensure enough resources and personnel are set aside to support the CSR activities.