CORPORATE SOCIAL RESPONSIBILITY AND PERFORMANCE OF DEPOSIT TAKING SAVINGS AND CREDIT COOPERATIVE SOCIETIES IN MERU COUNTY, KENYA
Kennedy Wanyoike Mungai - Master’s Student, Department of Business Administration, Kenyatta University, Kenya
Dr. Reuben Njuguna - Lecturer, Business Administration, Kenyatta University, Kenya
ABSTRACT
Based on their ROE, the majority of DT-Saccos in Kenya had inconsistent financial performance from 2017 to 2021. The ROE was 8.34% in 2017 and 9.40% in 2018, according to the trend, but it progressively decreased to 9.11% in 2019 and 8.26% in 2020. Consequently, the majority of DT Saccos are currently losing their relevance in the market and may eventually face closure. The aim of the research was to explore the effect of corporate social responsibility (CSR) on the organisational performance of the deposit-taking (DT) Saccos in Meru County, Kenya. The study objectives were to determine the effect of environmental CSR, legal CSR, philanthropic CSR, and economic CSR on the performance of DT-Saccos in Meru County, Kenya. The study used a descriptive research approach and be based on institutional theory and stakeholder theory. The 18 DT Saccos in Meru County made up the target population and various employees were chosen from these Saccos using stratified random sampling. Semi-structured questionnaires that participants self-administer was used to gather primary data. To explore the reliability of the research instruments, the Cronbach’s Alpha test was applied, using a threshold of 0.70. A pilot study involving 10 respondents was conducted to evaluate both the construct and content validity of the instruments. To strengthen content validity, a double-checking approach was adopted. The data collected were analysed using both descriptive and inferential statistical methods. Descriptive statistics included mean, frequencies, percentages, and standard deviations, while inferential analysis employed a regression model to examine the relationship between the study variables. The findings indicated a strong correlation between the dimensions of Corporate Social Responsibility (CSR) and the performance of DT-SACCOs, with an R-value of 0.812. This suggests that the independent variables collectively account for a significant portion of the variation in SACCO performance. The R Square value of 0.659 shows that approximately 65.9% of the performance variability in DT-SACCOs can be explained by the combined influence of environmental, legal, philanthropic, and economic CSR dimensions. Furthermore, the p-value of 0.003 confirms a statistically significant positive relationship between CSR practices and DT-SACCO performance. Based on these results, the study concludes that environmental, legal, philanthropic, and economic aspects of CSR significantly influence the performance of DT-SACCOs in Meru County, Kenya. The research recommended that managers of DT-SACCOs should integrate environmental CSR initiatives into their business operations to enhance sustainability and reputation. Implementing green financing options, reducing carbon footprints, and adopting responsible waste management practices could significantly improve stakeholder trust and customer loyalty. Sacco Societies Regulatory Authority (SASRA) should implement stricter monitoring mechanisms and provide training programs to help SACCOs understand and adhere to legal requirements.