Impacting Corporate Social Responsibility on Business Benefits: A Case Study of Small and Medium Enterprises in Ho Chi Minh City

Abstract

Nowadays, any world economic organization or product exporter must comply with social responsibility policies: Protect the environment, products are safe for consumers, have policies that respect and ensure benefits for employees, etc. The better the enterprise demonstrates its social responsibility, the higher its competitive advantage. In addition, social responsibility also helps increase long-term profits for businesses: In the short term, in the early stages, companies will face the cost problem when implementing social responsibility: waste treatment systems to protect the environment, modern machines to increase productivity and quality, standard protective clothing to protect workers, etc. However, in the long term, the investment activities of enterprises will bring about significant increases in profits by building brands, trust, and loyalty with consumers. In addition, businesses can quickly bring their products to international markets because they comply with social responsibility standards. Social responsibility, in general, will help enterprises to increase competitive advantages and develop sustainably. Thus, the author surveyed 550 managers working for the corporate social responsibility of 275 small and medium enterprises in HCMC. The author analyzed the key factors impacting corporate social responsibility (CSR) and CSR affecting business benefits. The author applied structural equation modeling (SEM). Finally, the scientific novelty showed five factors affecting corporate social responsibility for business benefits of SMEs in HCMC with a significance of 1.0 percent. Five elements included (1) Environment, (2) Employees, (3) Customers, (4) Suppliers, and (5) Community. It is critical to spread and educate about social responsibility and perfect the legal framework for its execution to fulfill corporate social responsibility in Vietnam.