Corporate Social Responsibility Practices in Dire Dawa Manufacturing Firms: Trends, Drivers and Barriers

Corporate Social Responsibility (CSR) is about balancing economic, social and environmental sustainability. The purpose of CSR is to make corporate business activity and corporate culture sustainable in three Economic, Social and Environmental & Ecological aspects. CSR in Ethiopia is still in its infancy. The private sector is not strong enough to consider CSR, despite the fact that it is expected to play a significant role in the expansion of CSR practices.Thus, this thesis investigated CSR practices, drivers and barriers in Dire Dawa manufacturing firms. Population of the study for this research were employees and managers currently working on the aforementioned industries and Higher officials of Ethiopian Investment Commission (EIC) in DD administration was also part of the population. Primary data were collected from 370 samples from the total population of 5000 employee. However 348 questionnaires were used for analysis due to non-return of questionnaires. The research type employed to conduct this study is inferential and descriptive survey. As to a data gathering tools the researcher used questioner and annual reports of firms. The questionnaire contained 55 questions that contain 5 questions on respondent’s information and 30 questions on drivers those push the firms to engage in CSR activities, 20 questions on levels of CSR involvement of firms. The validity and reliability of the questionnaire is verified by content and Cronbach’s alpha methods and the collected data is analyzed by both descriptive and inferential statistics such as correlations coefficient, coefficient of determination and multiple regression. The finding indicated that there is an existence of positive relationship between all independent variables (tradition and values; reputation/image; customers and consumers; strategy and competitiveness; community expectation and laws and political pressure) with CSR practices. In the regression model tradition and value have the highest beta coefficient, 0.324, followed by expected in community strategy and competitiveness reputation/image, customers and consumers, and laws and political pressure. The study recommended that firms should concentrate on developing a vision, mission, and values statement that includes CSR as one of its core components, they should consult beneficiaries about what service, how, and which types of service or support should be provided and the government should develop policies those focuses on strong regulatory requirements included in all the social and environmental and economical dimensions.