KOREASCHOLAR

Introduction Corporate social responsibility (CSR) has become a necessary tool for firms to develop competitive advantage (Duarte, 2010) as CRS is increasingly valued and demanded by stakeholders (consumers, investors, employees, etc) who see it as representing the civic behaviour of the companies (Prior, Surroca, & Tribo, 2008)..This study looks at the relationship between CSR and customer retention (CR) to answer the question: how does CSR influence CR? The study tries to answer the question by exploring the relationship between CSR and CR toward developing a process model to show how CSR leads to CR, using path diagrams and structural equation modeling. Data was collected through a questionnaire that drew from established measurement instruments, supplemented by primary research. Senior executives of three telecom firms in Ghana were sampled for in-depth interviews towards building a pool of relevant items for questionnaire development. Data from 681 completed questionnaire responses were subjected to structural equation modelling (SEM) to estimate the relationships among relevant constructs and variables. Findings/Conclusions The findings showed a direct relationship between CSR and customer retention as well as an indirect relationship between CSR and customer retention through corporate image (CI), perceived service quality (PSQ) and customer perceived value (CPV). The estimates for Goodness-of-fit indices of the CFA show that; GFI=0.934, AGFI=0.912, CFI=0.957, and RMSEA=0.055, indicating a good fit. The standardised estimates for Goodness-of-fit indices of the SEM show that; GFI=0.933, AGFI=0.912, CFI=0.955, and RMSEA=0.055, indicating a model of good fit. The study challenges theoretical notions with respect to the nature of influence that CSR brings to bear on corporate performance and invites further theoretical inquiry into how CSR inform corporate performance. The study provides the basis for further empirical research work in the area of examining the nature and relative importance of CSR criteria that customers consider in evaluating their perception of companies and behavioural intentions. It also serves as bases to stimulate research using data from different geographical settings to give avenue for the generalisation of the model to extend the CSR and CR theories. The study also furnishes managers with the knowledge that CSR is very necessary for customer retention strategies but it is not a means to an end on its own. It therefore suggests the various components in the process should not be underestimated as it has shown that CSR by itself does not lead to corporate performance in terms of customer retention. Firms may therefore want to improve on the intermediary components to increase corporate performance in terms of customer retention.

• Otto Afiuc(Ghana Institute of Management and Public Administration, Ghana)
• Samuel Bonsu(Ghana Institute of Management and Public Administration, Ghana)