A Study on the Effect of CSR and Entrepreneurship on Business Management Performance

Abstract

This study examines which elements of entrepreneurship and Corporate Social Responsibility (CSR) activity have the most effect on non-financial performance and financial performance, given the increase in CSR in recent years. The summary of the empirical analysis is as follows. First, regarding the influence of entrepreneurship on non-financial performance and management performance, the empirical analysis shows that innovativeness, risk-taking and pro-activeness had statistically significant positive effects on non-financial performance in that order, and risk-taking, innovativeness and pro-activeness had a significantly positive influence on financial performance respectively. Second, it was confirmed that among the independent variables of CSR activity, social responsibilities is an important and significantly relevant variable, followed by economic responsibilities and environmental responsibilities. Third, additional analysis regression Model 1 showed that among the entrepreneurship factors of the company, innovativeness had the most significant influence on CSR activity. Regression Model 2 showed that innovativeness, CSR activity, risk-taking and pro-activeness had significant positive effects in that order. It is thus possible to confirm that entrepreneurship and CSR activity play a very important role in management performance and have similar influences to those found by previous studies (Carroll, 1979; Schwartz & Carroll, 2003; Maignam & Ferrel, 2003; Zahra, 1991; Covin & Slevin, 1991). In other words, the results imply that CSR activity is not just a cost but also an investment - that it is a strategic tool for enhancing a company’s management performance and that strategic CSR activity through innovation by CEOs is necessary in order to strengthen management performance and competitiveness.