Corporate Social Responsibility Strategies Adopted by Micro Finance Institutions: A Case Study

Part of the CSR, Sustainability, Ethics & Governance book series (CSEG)


We hypothesize that, in order to improve their financial performance, Microfinance Institutions (MFI’s) should invest in social empowerment or Corporate Social Responsibility (CSR) programmes. CSR investments create opportunities to raise savings deposits and reduce default rates among debtors. However, the 2008 credit crunch led many MFI’s to cut back on CSR investments. Using case analysis and interviews, we examine the CSR best practices of uniCredit Ghana Limited MFI. We establish that a single branch used CSR strategies and outperformed the others. We therefore conclude that MFIs should consider CSR investment as a business opportunity rather than an expense.


Corporate Social Responsibility Stakeholder Theory Corporate Social Responsibility Activity Corporate Social Responsibility Strategy Loan Applicant 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


  1. Aghion, P., Fally, T., & Scarpetta, S. (2007). Credit constraints as a barrier to the entry and post-entry growth of firms. Economic Policy, 22(52), 732–779.CrossRefGoogle Scholar
  2. Armendariz, B., & Morduch, J. (2010). The economics of microfinance. Cambridge, MA: MIT Press.Google Scholar
  3. Armendáriz de Aghion, B., & Morduch, J. (2000). Microfinance beyond group lending. Economics of Transition, 8(2), 401–420.CrossRefGoogle Scholar
  4. Bank-of-Ghana. (2014). Bank of Ghana website. Generic.Google Scholar
  5. Banson, M. Y. (1997). The development of entrepreneurship in Ghana, opportunities for the tertiary graduate:(A case study of UST graduates). Google Scholar
  6. Botosan, C. A. (1997). Disclosure level and the cost of equity capital. Accounting Review, 323–349.Google Scholar
  7. Chen, K. C., Chen, Z., & Wei, K. J. (2009). Legal protection of investors, corporate governance, and the cost of equity capital. Journal of Corporate Finance, 15(3), 273–289.CrossRefGoogle Scholar
  8. Cheng, B., Ioannou, I., & Serafeim, G. (2014). Corporate social responsibility and access to finance. Strategic Management Journal, 35(1), 1–23.CrossRefGoogle Scholar
  9. (2010). Population census in Ashaiman. Generic.Google Scholar
  10. Clarkson, M. E. (1995). A stakeholder framework for analyzing and evaluating corporate social performance. Academy of Management Review, 20(1), 92–117.Google Scholar
  11. Edgcomb, E. L. (2002). What makes for effective microenterprise training? Journal of Microfinance/ESR Review, 4(1), 99–114.Google Scholar
  12. Eisenhardt, K. M. (1989). Building theories from case study research. Academy of Management Review, 14(4), 532–550.Google Scholar
  13. Ekpe, I., Mat, N., & Razak, R. C. (2011). Attributes, environment factors and women entrepreneurial activity: A literature review. Asian Social Science, 7(9), p124.CrossRefGoogle Scholar
  14. El Ghoul, S., Guedhami, O., Kwok, C. C., & Mishra, D. R. (2011). Does corporate social responsibility affect the cost of capital? Journal of Banking and Finance, 35(9), 2388–2406.CrossRefGoogle Scholar
  15. Elaine, E., & Barton, L. (1998). Social intermediation and microfinance programmes: A literature review. Washington, DC: Micro-Enterprises Best Practices.Google Scholar
  16. Freeman, R. E., Wicks, A. C., & Parmar, B. (2004). Stakeholder theory and “the corporate objective revisited”. Organization Science, 15(3), 364–369.CrossRefGoogle Scholar
  17. Galbreath, J. (2006). Does primary stakeholder management positively affect the bottom line? Some evidence from Australia. Management Decision, 44(8), 1106–1121.CrossRefGoogle Scholar
  18. Gibbs, G. (2002). Qualitative data analysis: Explorations with NVivo (Understanding social research). Buckingham: Open University Press.Google Scholar
  19. Godquin, M. (2004). Microfinance repayment performance in Bangladesh: How to improve the allocation of loans by MFIs. World Development, 32(11), 1909–1926.CrossRefGoogle Scholar
  20. Graebner, M. E., Martin, J. A., & Roundy, P. T. (2012). Qualitative data: Cooking without a recipe. Strategic Organization, 10(3), 276–284.CrossRefGoogle Scholar
  21. Hail, L., & Leuz, C. (2006). International differences in the cost of equity capital: Do legal institutions and securities regulation matter? Journal of Accounting Research, 44(3), 485–531.CrossRefGoogle Scholar
  22. Hubbard, R. G. (1997). Capital-market imperfections and investment. National Bureau of Economic Research.Google Scholar
  23. Jamali, D. (2008). A stakeholder approach to corporate social responsibility: A fresh perspective into theory and practice. Journal of Business Ethics, 82(1), 213–231.CrossRefGoogle Scholar
  24. Joakim, E. P., & Wismer, S. K. (2015). Livelihood recovery after disaster. Development in Practice, 25(3), 401–418.CrossRefGoogle Scholar
  25. Joy-online. (2014). Fidelity Bank aquired Procredit. Generic.Google Scholar
  26. Karlan, D., & Valdivia, M. (2011). Teaching entrepreneurship: Impact of business training on microfinance clients and institutions. Review of Economics and Statistics, 93(2), 510–527. doi: 10.1162/Rest_a_00074.CrossRefGoogle Scholar
  27. Karnani, A. G. (2007). Employment, not microcredit, is the solution (Ross School of Business Paper 1065).Google Scholar
  28. Khurana, I. K., & Raman, K. (2004). Litigation risk and the financial reporting credibility of Big 4 versus non-Big 4 audits: Evidence from Anglo-American countries. The Accounting Review, 79(2), 473–495.CrossRefGoogle Scholar
  29. Kwasi Buame, S. (1996). Entrepreneurship: A contextual perspective. Discourses and praxis of entrepreneurial activities within the institutional context of Ghana (Vol. 28). Lund: Lund University Press.Google Scholar
  30. Ledgerwood, J. (1999). Microfinance handbook: An institutional and financial perspective. Washington, DC: World Bank.Google Scholar
  31. Lensink, R., Mersland, R., & Nhung, V. T. H. (2011). Should microfinance institutions specialize in financial services. Paper presented at the Second international research conference on microfinance. Groningen: The Netherlands.Google Scholar
  32. Maon, F., Lindgreen, A., & Swaen, V. (2009). Designing and implementing corporate social responsibility: An integrative framework grounded in theory and practice. Journal of Business Ethics, 87(1), 71–89.CrossRefGoogle Scholar
  33. Mix-Market. (2015). Transforming financial inclusion data into insight. Accessed December 5, 2015, from
  34. Monitor, M. C. (2013). Thirty Microfinance Institutions (MFIs) close in Ghana. Accessed October 10, 2015, from
  35. Moskowitz, M. (1972). Choosing socially responsible stocks. Business and Society Review, 1(1), 71–75.Google Scholar
  36. Papasolomou-Doukakis, I., Krambia-Kapardis, M., & Katsioloudes, M. (2005). Corporate social responsibility: The way forward? Maybe not! A preliminary study in Cyprus. European Business Review, 17(3), 263–279.CrossRefGoogle Scholar
  37. Parket, I. R., & Eilbirt, H. (1975). The practice of business social responsibility: The underlying factors. Business Horizons, 18(4), 5–10.CrossRefGoogle Scholar
  38. Ployhart, R. E., & Moliterno, T. P. (2011). Emergence of the human capital resource: A multilevel model. Academy of Management Review, 36(1), 127–150.CrossRefGoogle Scholar
  39. Poddi, L., & Vergalli, S. (2009). Does corporate social responsibility affect the performance of firms. Fondazione Enri Enrico Mattei, 52(09), 16–21.Google Scholar
  40. Ribando, J. M., & Bonne, G. (2010). A new quality factor: Finding alpha with ASSET4 ESG data. Starmine Research Note, Thomson Reuters.Google Scholar
  41. Sjauw-Koen-Faa, A. R., Blok, V., & Omta, S. O. (2016). Critical success factors for smallholder inclusion in high value-adding supply chains by food & agribusiness multinational enterprises. International Food and Agribusiness Management Review, 19(1), 83.Google Scholar
  42. Snider, J., Hill, R. P., & Martin, D. (2003). Corporate social responsibility in the 21st century: A view from the world’s most successful firms. Journal of Business Ethics, 48(2), 175–187.CrossRefGoogle Scholar
  43. Starrfmonline. (2015). BoG has revoked the licenses of 70 MFI’s in Ghana (2015 ed.). Accra: Ghana.Google Scholar
  44. Tang, Z., & Tang, J. (2012). Stakeholder–firm power difference, stakeholders’ CSR orientation, and SMEs’ environmental performance in China. Journal of Business Venturing, 27(4), 436–455.CrossRefGoogle Scholar
  45. Wichterich, C. (2012). The other financial crisis: Growth and crash of the microfinance sector in India. Development, 55(3), 406–412.CrossRefGoogle Scholar
  46. Yunus, M. (1999). The Grameen Bank. Scientific American, 281(5), 114–119.CrossRefGoogle Scholar
  47. Yunus, M. (2007). Creating a world without poverty: Social business and the future of capitalism. New York: PublicAffairs.Google Scholar

Copyright information

© Springer International Publishing AG 2017

Authors and Affiliations

  1. 1.University of WageningenWageningenThe Netherlands

Personalised recommendations