Effects of Corporate Social Responsibility Activities on Customer Loyalty: Case Study of MTN Uganda

Abstract

The study examined the effect corporate social responsibility activities have on the loyalty of MTN subscribers. Specifically, the study looked at how MTN Uganda is performing in the four major components of corporate social responsibilities, that is, economic responsibilities, legal responsibilities, philanthropic responsibilities, and ethical responsibilities. In an effort to accomplish this, 70 questionnaires were administered to MTN subscribers. The sample size was selected using stratified sampling. Since questionnaires were interviewer-administered, the response rate was 100%. The objective of the study is explanatory. The data collected was analyzed using multiple regression. It was discovered that corporate social responsibilities had a significant effect on the loyalty of MTN customers. It was further found out that all the four components of CSR contributed to the loyalty of MTN customers, but philanthropic responsibility was the most dominant of MTN’s CSR activities. On the other hand, the ethical responsibility of CSR was the least dominant. It was therefore concluded that MTN was performing well in the four major areas of corporate social responsibilities which are economic responsibilities, legal responsibilities, philanthropic responsibilities, and ethical responsibilities. Based on the findings, it was recommended that MTN continues to perform in a manner consistent with maximizing earnings of its shareholders in order to enjoy the loyalty of their customers. In addition, MTN must perform in a manner consistent with the expectations of government and law and it must not neglect to obey the law as it results in loyal customers. Again, it is recommended that MTN continue to perform in a manner consistent with the do-good and charitable expectations of society and also assist voluntarily those projects that improve the community’s "quality of life." Finally, MTN must continue to maintain its friendliness toward the environment because it is the reason for the loyalty of its customers.