Corporate Social Responsibility and Competitive Advantage in Commercial Banks in Nairobi County, Kenya

Authors

  • Irene Kerubo Makori
    MBA Student, Strategic Management, Jomo Kenyatta University of Agriculture and Technology
  • Dr. Dennis Juma
    Jomo Kenyatta University of Agriculture and Technology

Abstract

Purpose: The study aimed to investigate the influence of Corporate Social Responsibility (CSR) on competitive advantage in commercial banks in Kenya, with a specific focus on the contributions of philanthropic initiatives and environmental activities.


Material/methods: Anchored in the Firm’s Resource-Based View and the Natural Resource-Based View, the study adopted a descriptive survey research design. The target population consisted of 238 employees working in strategic and CSR departments at the headquarters of 21 licensed commercial banks in Kenya, including nine first-tier and twelve second-tier institutions. A stratified and random sampling technique was employed to select a sample of 148 respondents. Data were collected using structured questionnaires. Descriptive statistics (frequencies, percentages, means, and standard deviations) were used to summarize the data, while inferential statistics—including Pearson correlation and multiple linear regression—were utilized to assess the relationships and predictive influence of CSR practices on competitive advantage.


Findings: The findings demonstrated that both philanthropic initiatives and environmental activities exert a positive and statistically significant influence on competitive advantage. These CSR dimensions were shown to enhance institutional reputation, stakeholder engagement, and long-term strategic positioning.


Conclusion: The study concludes that CSR is a strategic asset that enhances the competitiveness of commercial banks. Philanthropic and environmentally sustainable practices, when integrated with core business strategies, contribute meaningfully to organizational differentiation and performance in the competitive banking sector.


Value: This research highlights the strategic importance of CSR in the financial sector and recommends that commercial banks strengthen their CSR frameworks by aligning them with business objectives and incorporating innovative, socially impactful initiatives. Such alignment can reinforce competitive advantage while advancing broader sustainability goals.