ABSTRACT

Currently, the banking industry is experiencing an exponentially increasing competition among other challenges like government regulations. Therefore, to curb these challenges and be sustainable in the fragile business environment, banks have shifted their focus towards appealing to the public in order to create a good corporate image through philanthropic, ethical, economic and community based practices. The general objective of the study was to investigate Corporate Social Responsibility and Competitiveness. The specific objectives were; to establish the effect of philanthropic practices, to examine the effect of ethical, to determine the effect of economic and analyze the effect of community based practices on competitiveness of commercial banks in Kericho town, Kenya. The study is significant to several stakeholders including the government, policy makers in the banking institutions and academician. The study used the resource based view, stakeholders’, and strategic leadership theories. It used descriptive research design; a population of 9 commercial banks, sample size of 51 bankers and 80 customers selected using simple random sampling technique. The data was collected using questionnaires distributed to the respondent. The researcher used descriptive and inferential statistics to analyze data with the aid of Statistics Package of Social Science. The findings indicated that there was positive significant effect of philanthropic, ethical, economic and community based practices on the competitiveness. The study concluded that the corporate social responsibility significantly influences competitive advantage. Economic practice had the highest significant effect on competitiveness followed by philanthropic, community based and finally ethical practices. The study then recommended that the government and the commercial banks should practice corporate social responsibility. It creates customer relation; increases market share improves relationship with the suppliers. Further studies should be conducted on corporate social responsibility and the economics growth of the community.