The Impact of CSR on the Economic Performance of Small and Medium-Sized Enterprises

Abstract

Corporate Social Responsibility (CSR) is becoming an increasingly important part of business models in small and medium-sized enterprises (SMEs). Although CSR is already an integral part of business in large companies, also smaller companies are affected by their regulation through value chains and customer awareness. In this study, the impacts of CSR on the economic performance of SMEs in Southern Finland are explored. The study aims to find out, which CSR strategies can bring the best financial and competitive benefits for the companies, which economic measures are the most relevant, and which CSR strategies best support the long-term sustainable competitive advantage in SMEs. The research was conducted as a qualitative study with semi-structured interviews of SME owners and managers. With these interviews, it was possible to gain information about the practical goals and implementation methods of CSR, even though the sample was limited. Prior to the interviews, a literature review was conducted to identify the sustainability themes that are relevant to the economic performance of SMEs. The key finding is that CSR is a strategic long-term investment for the SMEs. The sustainable competitive advantage of CSR in SMEs arises from direct financial savings and environmental benefits, as well as from the growth of the company’s market value in the eyes of stakeholders. The long-term continuity of sustainability work supports business continuity, sustainable competitiveness, and resilience