**2. Theoretical framework**

Based on the stakeholder theory propounded by Freeman in 1984, a firm should create value for all stakeholders, not just shareholders. Stakeholders are a group of persons or individuals who can affect or are affected by the actualization of an organization's objectives [17]. The host community is a stakeholder in a business entity. The activities and operations of a business entity or company affect people and the environment. These effects have social and environmental implications. CSR is carried out by business entities to meet the needs of business stakeholders. According to Huang and Watson [18] CSR is the effort of corporations by willingly engaging in activities that display promotion of social good. These activities are usually beyond the normal operations of the company and legal requirements. Radhakrishnan et al. [19] note that the apportionment of resources and activities are a branch of the business model that assist in addressing social problems indirectly, moderating negative effects and encouraging positive effects of a corporation. Radhakrishnan et al. [19] further state that managers need to make decisions on how resources and input, which leads to outputs for the benefit of shareholders and business stakeholders.

The main features of CSR are: (1). willing involvement, (2) dealing with outcomes such as the impact a firm may possibly have on a local community, (3) considering all business stakeholders, (4) alliance of the social and economic responsibilities, (5) formation of business morals and practices that focus on social responsibility, (6) going further than just being philanthropic [20]. Studies [21, 22] agreed that the continual willingness of business to act ethically while improving employee quality of life and that of the local community and society is one of the reasons for CSR.

According to Chaffee [21], CSR can be traced to the Roman Laws that gave rise to institutions such as shelters, homes for the underprivileged and old, hospitals and children's home. In world history, the Middle Age era was a period when firms were perceived as social corporations by academic, public and religious bodies. Later on, with the powers conferred on the English Crown, corporations were viewed as a mechanism for social growth.

The history of CSR can be traced to the 1950's and 1960's. According to Waterhouse [23], during the 1960's there was a new social perspective marked by a growing agitations for respect of civil rights in the United States of America. These protests were deep-seated student rallies and political activities; and protesters perceived that businesses were an essential part of the institution they wanted to change. Madrakhimova [24] noted that CSR during the 50's and 60's focused on corporate philanthropy, and workforce safety. However, Waterhouse [23] noted that the general social setting during the late 1960's resulted in low morale by businesses to fulfill the need for CSR. According to Johnson [25], a socially responsible firm is one whose management balances a variety of interests beyond pushing only for larger profits for its stockholders. Such a firm also considers employees, suppliers, dealers, local communities, and the nation. Latapí-Agudelo et al. [26] stated that in the 1970's some of the most prominent corporations with regard for CSR were established, namely Body Shop, Ben and Jerry. However, the rationale for the interest in CSR could have been as a result of regulation or the societal concerns at that time. Due to the internationalization of business entities in the 90s, CSR became a global phenomenon. According to Latapí-Agudelo *et al.* [26], the CSR concept was demanded internationally, maybe due to the international method to sustainable growth at that time and the effect of globalization on business operations. Multinational corporations became faced with operations abroad.

### **2.1 Components of corporate social responsibility**

CSR comprises economic, ethical, philanthropic and legal responsibilities [27]. These responsibilities are carried out by corporations in service to communities and people. According to Gonzalez-Rodriguez et al. [28], corporations have to meet their economic responsibilities which include paying shareholders a return on their investment, maintaining the size in the market, while maximizing profits, satisfying consumers, providing a fair reward for employees. Ethical responsibilities are important in ensuring that stakeholders receive equal and fair treatment from the business. A firm that carries out ethical responsibilities to stakeholders respects the rights of such persons while creating a better framework for the development of employees, managers, owners, customers, suppliers, the host community, and environment [29]. When CSR is perceived as charity or corporate giving it is a philanthropic responsibility. According to Gregore [30], philanthropic responsibilities are the voluntary responsibilities of a corporation. Philanthropic responsibilities are those which corporations voluntarily engage in and are not required by law. Examples of voluntary responsibilities are donation of goods, rendering free services, volunteering to educate or teach, and participation in community service. Legal responsibilities are those which a corporation must comply with to prevent sanctions from the state [31]. Legal responsibilities are carried out by corporations because there are laws within which a corporation must function.
