What Prompts Small and Medium Enterprises to Engage in Corporate Social Responsibility? A Study from Taiwan

This paper applies the innovation diffusion theory to analyze the impact of perceptive characteristics on the willingness of small and medium enterprises (SMEs) to engage in corporate social responsibility (CSR). Results from 136 SMEs in the manufacturing industry demonstrate that the characteristic of compatibility has a strong and positive influence on the willingness of SMEs to engage in CSR, which means not only that managers' personal values and morality and managers' support are CSR drivers, but also that current corporate culture consistent with CSR and the corporate image fitting well with the concept of CSR will encourage higher take-up of CSR. Conversely, complexity has a negative impact, which means that the social compliance costs, time, and lack of guidance or benchmarks are regarded as a barrier for SMEs to implement CSR. The educational levels of owner-top managers have a marked effect on CSR initiatives; the impact is greatest from managers with graduate level degrees. Due to the size effect among SMEs, the annual revenue is positively associated with the willingness of SMEs to engage in CSR. Finally, some implications and limitations are discussed. Copyright (c) 2011 John Wiley & Sons, Ltd and ERP Environment.