The main aim of this study is to investigate the impact of compliance with the principles of corporate responsibility, ethics, and accountability on a company’s profit-making capability. The study will be carried out in three telecommunication companies in New York. Data will be collected using both questionnaires and interviews, which will be analyzed to come up with findings and conclusions.
Key words: profit making, corporate responsibility, ethics, accountability.
3. Description of the Project:
3.1. Statement of the Problem
Historically, business organizations have been viewed as profit making machines, with major focus on creating income and revenue, and not much concern on social responsibility and ethics. According to Wahba (2008), in some cases, the profit-maximizing behavior as been seen as being contrast to corporate responsibility and ethical governance. Modern business organizations, are however, struggling with a new responsibility, meeting the demands of the current generations without negatively impacting on the ability of the following generations to address their needs. Thus, businesses are being expected to take responsibility, be accountable and act ethically towards the various stakeholders, the natural environment and to minimize negative impact on societies in general.
Past studies have suggested an important relationship between corporate responsibility, ethics and accountability and the profit making capability of business organizations. With the increasing pressure from the various stakeholders, such a relationship would be beneficial (Lu, Wang & Lee, 2013). Thus, this study seeks to establish whether corporate responsibility, ethics and accountability has a positive impact on the profits made by companies.
3.2. Rationale, Objectives and Research Questions
The aim of this study is to establish the actual impact of corporate responsibility, ethics and accountability on the profitability of companies. Evidence of such an impact will inform other similar business organizations in developing their business strategies, such that they include social and environmental concerns in interacting with their stakeholders and in their overall business operations.
The main objective of this study is:
Does corporate responsibility, ethics and accountability impact positively on the profits made by business organization?
What is the level of corporate responsibility, ethics and accountability in the company?
Does the company have explicit documentation showing commitment to corporate responsibility, ethics and accountability?
A study carried out by Lu, Wang & Lee (2013) shows that there is still lack of compliance with the principles of corporate responsibility, ethics and accountability in companies. This is evidenced by the ongoing cases of unethical and questionable behaviors by executives and even individual wormers. This evidence indicates critical questions regarding how compliance can be enhanced and the increasing demand for sustainable business and socially responsible practices, be increased (Wahba, 2008).
Wahba (2008) reveals that a relationship exists between compliance to these principles and the profit making ability of companies. However, much of the arguments presented relate to the theory of corporate social responsibility, as not much has been done in practice. The idea presented in theoretical basis is that the important stakeholders in businesses, investors and consumers are seeking those companies that have adopted corporate social responsibility and ethical practices. Thus, with a high level of compliance, companies are expected to benefit in terms of investment and more revenue from sales.
More research is necessary in practice to provide adequate evidence of this relationship. Therefore, the findings from this study will add to the much-needed body of knowledge in this area, and even provide more support for the demand for companies to be socially responsible, accountable and act ethically.
3.4. Basic Information Sources:
The basic sources of information for this study will be primary, secondary, tertiary. For the primary information, data will be collected using a survey and interviews that will be administered to the managers of the business. Other sources of primary information will be records available relating to corporate responsibility, ethics and accountability, and on the revenue of the business. Though the records might not be easily available and that some might be concealed at the convenience of the management, primary sources provide the most credible information.
Information will also be collected from journals and other periodicals resulting from the already mentioned key terms. This information is readily available with access to the internet and library, but the level of credibility is somewhat lower than in the use of primary sources. Fact books, indexes and textbooks will provide tertiary information. They are readily available but their credibility as sources of information must be supported by primary sources.
3.5. Research Strategy:
The search will examine both quantitative and qualitative literature to provide a balanced and holistic view of the topic. A literature search will be undertaken to identify relevant studies that meet the objectives of the study. In order for the literature review to be carried out, a systematic approach will be followed to provide reliable and valid results. Various databases will be used as information sources, including: ProQuest Business Collection, JSTOR, and ERIC. The resiruces will be obtained using the keywords. Key search terms are developed from the topic title, profit making, corporate responsibility, ethics, accountability by using Boolean operators (AND, OR, NOT), leading to main searches.
Both qualitative and quantitative data will be collected. A survey will be done using a questionnaire given to the executives in the three companies identified in the United States. This will be followed by more detailed interviews from the same participants to provide more detailed information to answer the research questions.
Sample and Sampling
A sample of 15 executives will be used in the study. The method that will be used in obtaining the sample is cluster sampling, where the number of companies offering telecommunication services in New York will be obtained. From the total number, a sample of three companies will be obtained, and from the three, five executives will be obtained using purposive sampling method. This will ensure that the participants are executives and have adequate understanding of the operations of the company.
Quantitative data, data obtained using the questionnaires, will be analyzed using the Statistical Program for Social Sciences (SPSS) to compute bivariate correlation between corporate responsibility, ethics and accountability and company’s profitability. The data collected using the interviews will be analyzed using discourse analysis to establish the common themes and make conclusions.
3.7. Structure of the Project:
Introduction: this section will provide the background of the study, including the statement of the problem, rationale for doing the study, significance, the objectives and research questions.
Literature review: this section will provide a detailed review of the past studies on the topic, identifying connections to the current study, and gaps to be filled by performing the proposed research.
Methodology: This section will outline the methodology and methods that will be used in doing the research. Research design and data collection methods, the sample and sampling method, and the data analysis method will be provided.
Findings: this section will provide a detailed analysis of the data and the results obtained from the analysis.
Discussions and conclusions: discussions of the results obtained in the previous section will be given in this section, including the conclusions made by the researcher.
It is expected that a positive relationship will be established between corporate responsibility, ethics and accountability and company’s profitability. This means that compliance with these principles is expected to increase the level of profitability of business organizations. This is given the positive view of the investors and consumers resulting from compliance. The results from the study will be beneficial to companies following the increasing demands from the stakeholders to adapt to the principles of corporate responsibility, ethics and accountability, and more important to perform ethical and sustainable business operations.
Some of the technical and ethical problems that might be encountered in the process of doing the research include access to the necessary documents related to the company’s performance. there might be other problems such as failure by the executives to disclose some important information related to the company and beneficial to the study.
Lu, W., Wang, W., & Lee, H. (2013). The relationship between corporate social responsibility and corporate performance: evidence from the US semiconductor industry. International Journal Of Production Research, 51(19), 5683-5695.
Wahba, H. (2008). Does the market value corporate environmental responsibility? An empirical examination. Corporate Social Responsibility & Environmental Management, 15(2), 89 99