THE IMPACT OF SOCIAL RESPONSIBILITY ON CORPORATE PROFITABILITY (A CASE STUDY OF 7UP BOTTLING COMPANY 9TH MILE ENUGU)

ABSTRACT

In the past, 7up Bottling Company 9^th Mile Enugu separated sally to maximize profit in order to maximize the shareholders wealth. This objective has been subject to criticisms by these who strongly believed that, it create income and power inequality, determining working environment notes in industrial unrest and increase in government restriction to mention just a few of these social problems.

The study attempted to determine the relationship between social responsibility and corporate profitability of 7up Bottling Company Data were collected through the use of self-administered questionnaire and analyzed. The result of the analysis showed the active involvement of participating respondents in social responsibility. Hence, the study serves as an eye-opener for organization that are yet to engaged in social responsibility.

TABLE OF CONTENTS

CHAPTER ONE

1.0       Introduction of the study                                          

1.1              Statement of the study                                  

1.2              Purpose of the study                                                  

1.3              Scope of the study                                                     

1.4              Research hypothesis                                       

1.5              Significance of the study                                           

1.6              Limitation of the study                                              

1.7              Definition of terms                                                    

References                                                                             

CHAPTER TWO

2.0       Literature review                                                                    

2.1              Concept of social responsibility                                 

2.2              Social responsibility an corporate responsiveness      

2.3              Managing social responsibility                                               

2.4              Social responsibility model                                        

2.5              Argument for and against social responsibility                      

2.6              Flow business feel about social responsibility           

2.7              The social responsibility area                                     

2.8              Social responsibility and profitability                                    

2.9              Evaluating social responsibility                                  

2.10          Historical views of social responsibility         

2.11          Business ethics                                                                       

References                                                                             

CHAPTER THREE

Methodology                                                                                     

3.0       Restatement of the research questions and hypothesis          

3.1            Research design                                                                                 

3.2            Characteristic of the study population                                               

3.3            Sample plan and design                                                         

3.4            Instrument for research study                                                

3.5            Method of data collection                                         

References                                                                             

CHAPTER FOUR

Presentation and analysis of data                                                      

4.1              Introduction                                                                                       

4.2              Respondents characteristics and classification                      

4.3              Social responsibility of case study                 

4.4              Pattern of social responsibility of case study                         

4.5              Management practices and organizational effectiveness       

References                                                                             

CHAPTER FIVE

Summary, finding, conclusion and recommendation                        

5.1              Summary                                                                                

5.2              Conclusion                                                     

5.3              Recommendation                                                                   

5.4              Suggestions for further study                                    

References                                                                             

CHAPTER ONE

1.0       INTRODUCTION OF THE STUDY 

Management literature in recent years has includes a considerable amount of debate regarding the impact of social responsibility on corporate profitability in Nigeria organizations. Socially responsible actions are not undertaken to improve profit performance at the short-run but to meet some social needs and aspirations. Business operates in environment where certain factors such as cultural norms, social activities, political, economics and natural factors, influences it. This factors has to be considered so as to be socially responsible.

The importance of the impact of social responsibility has been viewed by some business organizations such as the restoring of Leki Beach in Lagos by Chereon (Nig) Limited, the sponsoring of many sports activities by some Nigerian organizations even in restructuring of housing properties are all charged as been socially responsible to it host communities.

All the above mentioned organizations must have gone beyond the objectives for which it was established. A lot of organizations have been socially responsible to it host town for purpose of bringing development to such communities. For instance, provision of good road, pipe borne water, installation of electricity and other welfarism measures taken to boast the morale of such communities within its operating environment.

Meanwhile, it is on this background that the research has been tried to examine the extent that 7up Bottling Company, 9^th mil branch, Enugu. Has gone in responding to its social responsibilities, it has been observed that the existence of some of this business organizations has done some harm to the environment such as pollution. The government also creates agencies such as the Federal Environmental Protection Agency (FEPA) by decree 58 of 1988 to serve as a watchdog of the environmental standards in the society.

7up Bottling Company should not only maximize profit but should be convened about the environments in which it exist, it should also consider the responsibility to their customers, employees and the general public.

1.1              STATEMENT OF THE STUDY

Socially responsible has been a hot topic in almost every business arena from corporate, board room to the classroom as to whether or not organizations should be responsive it various aspect of been social responsible. Despite the growing importance of social responsibility in corporate governance, the following issues have not been fully addressed:

-                      How can social responsibility enhance corporate profitability?

-                      What are the benefits of being socially responsible to corporate individuals

-                      Why is social responsibility considered as a waste drain in business resources?

-                      Are Nigeria business organization socially responsible

-                      Why should organization be socially responsible to its immediate environment 

1.2              PURPOSE OF THE STUDY

Given the age long controversy over the companies involvement in corporate social responsibility and the unending debate on its environment, economic, social and political implication. The main objective of this research is to find out among other things.

-                      To find out whether or not in reality, a capital investment in schools, maturity centers or control of gaseous emissions and liquid effluent can be sufficiently, value – driven as to increase productivity.

-                      To determine why some organizations are socially responsible than others in the same field of operation.

-                      To analyse various form of social responsibility of organizations to the society.

-                      To determine whether or not social responsibility increase corporate profitability.

-                      To make suggestions on how to improve corporate social responsibility.

1.3              SCOPE OF THE STUDY

The researcher has appropriately chosen 7up Bottling Company, 9^th Mile branch, Enugu as the case study of this particular topic. The researcher has decided to ask question from some personnel staff of the human resources department.

1.4              RESEARCH HYPOTHESIS

Ho:      Involvement in social responsibility does not lead to higher profitability

Hi:       Involvement in social responsibility lead to higher profitability It variables are

i)                    Social responsibility => Independent variables 

ii)                  Corporate responsibility => Dependent variables

1.5              SIGNIFICANCE OF THE STUDY

The extent to which social responsibility is relevant to an organization makes it a worthwhile takes to be studied. Several studies have concluded that organization that engaged in social responsibility make reasonable profit at the long run despite the huge expenditure on social responsibility. Hence, the study will serve as an eye opener for organization that are yet to engaged in it and the study will be of great significant to organization operating in a dynamic and competitive environment.

The study is also expected to add to the store knowledge of business organization theory and philosophy. Social action may help a business to become aware of the charging market factors such as tastes, preferences and fashion which can be useful for its marketing action.

1.6              DEFINITION OF TERMS

Corporate: According to chief Justice John Marshall (1819) of the US supreme court, define it as an artificial being, invisible, intangible and existing only in contemplation of law. But for the purpose of the study, corporate is defined as organization, businesses in which individuals join together for the purpose of carrying on some business or undertaking.

 PROFITABILITY: It is a key distinguishing characteristics of business firms. It provides the means of measuring performance, growth and survival of organization and a pre-requisite for social responsibility. 

SOCIAL: Company of consumers and employees as well as social institution, which benefit from business or provide benefit to it.

RESPONSIBILITY: An obligation to use authority to see that duties are performed. That is obligations owned to individuals. Henry Fayol, puts it as a right to give order and power to obey.

SOCIAL RESPONSIBILITY: It can be defined as a managerial response to social demands such as business ethics, urban affairs, consumer affairs and environmental affairs.