Abstract
This article is intended to empirically test the effectiveness of the Corporate Social Responsibility (CSR) dimension of assistance to Small Business Entrepreneurs (SMEs) under companies’ guidance of Semen Indonesia in Central and East Java. Corporate Social Responsibility (CSR) implementation for Small Business Entrepreneurs (SMEs), besides as a social contract implementation, is also an effort to increase legitimacy. This study is essential to obtain effective and relevant CSR dimensions recommended for the SME empowering program. The study was conducted at SMEs domiciled around the mining area and the cement factory. Out of 250 SMEs, 92 SMEs were involved in this study. The research data was primary, including respondents’ opinions, where the data were taken using survey and interview procedures. Data analysis using statistics was a factorial analysis. The results showed that of the eight programs included in CSR in the field of assistance for empowering SMEs, two were effective for empowering SMEs: (1) low-cost revolving funds and (2) production equipment assistance for SMEs. Meanwhile, six other CSR programs showed ineffectiveness: (1) mentoring, (2) marketing, (3) ease of procedure and relief of loan terms, (4) education and training, (5) accessibility of obtaining loans, and (6) the involvement of parties in the implementation of CSR. It indicated that the six CSR programs were not effective in helping to build image and legitimacy. The results of the research make an important contribution to the government and corporations and show that the construction of CSR programs must give attention to the real conditions and needs of SMEs in order to achieve effectiveness in solving problems by SMEs. Especially for the government, regulations are needed that can systemically encourage companies to implement CSR. This research still has limitations, therefore further research should be developed, especially in the area of empirical testing related to the contextual dimensions of CSR that are relevant to assisted stakeholders. Development-based research should be considered.
Highlights
Corporate Social Responsibility (CSR) implementation is a form of social contract actualization and an effort to build its legitimacy in the stakeholders’ eyes [1,2,3,4,5]
This study shows the research method, which is followed by findings and discussion
The results of the factorial analysis calculations to see the effectiveness of the dimensions/CSR activities of marketing facilitation programs for Small Business Entrepreneurs (SMEs) showed that three dimensions of CSR marketing were effective: (1) product exhibition (Q12); (2) joint promotion (Q13); (3) gallery assistance (Q13), with an effectiveness grade of 50.71
Summary
Corporate Social Responsibility (CSR) implementation is a form of social contract actualization and an effort to build its legitimacy in the stakeholders’ eyes [1,2,3,4,5]. It was further stated that there was often a miss between the type of assistance and the real needs and problems of SMEs. the design of CSR programs provided by companies needs to be communicated with SMEs before they are implemented. (2) provide input from practitioners (especially corporations), CSR practitioners must pay attention to contextual factors (especially contractual assisted stakeholders because this determines the achievement of CSR), and academies must develop research in this field (especially in the area of models and strategies for implementing more productive and effective CSR). In the last section, the research conclusions are described in detail while providing limitations and suggestions for future research
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