MEASURING THE IMPACT OF CSR INITIATIVES ON SUSTAINABLE DEVELOPMENT PERCEPTION: A STRUCTURAL EQUATION MODELING APPROACH ACROSS INDIAN SMES AND MNCS

Surilee Saraf Jain; Ruchi Maheshwari Bangur

doi:10.29121/p53cvb98

Authors

Surilee Saraf Jain Research Scholar, Banasthali Vidyapith, Jaipur, Rajasthan, India Author
Dr. Ruchi Maheshwari Bangur Assistant Professor, Banasthali Vidyapith, Jaipur, Rajasthan, India Author

DOI:

https://doi.org/10.29121/p53cvb98

Keywords:

Csr Quality Perception, Stakeholder Trust, Sustainability Outcome Perception, Structural Equation Modeling, Multi-Group Analysis, Smes, Mncs, India

Abstract

This study investigates how stakeholder perceptions of Corporate Social Responsibility (CSR) quality—encompassing dimensions of transparency, community impact, and environmental focus—influence sustainable development outcomes in the Indian corporate landscape, and how these relationships differ between Small and Medium-sized Enterprises (SMEs) and Multinational Corporations (MNCs). Drawing on stakeholder theory, signaling theory, and the legitimacy framework, this research proposes and tests a comprehensive structural model in which stakeholder trust mediates the relationship between perceived CSR quality and sustainability outcome perception. A stratified random sample of 524 respondents—comprising employees, investors, and community members—was surveyed across four Indian states (Maharashtra, Karnataka, Gujarat, and West Bengal) using a validated 38-item Likert-scale questionnaire. The data were analyzed using Confirmatory Factor Analysis (CFA) to validate the measurement model and Structural Equation Modeling (SEM) to test the structural relationships. Multi-group analysis was employed to examine whether the proposed model differs significantly across SME and MNC contexts. Results confirm that CSR quality perception significantly and positively influences both stakeholder trust (β = 0.67, p < 0.001) and sustainability outcome perception (β = 0.42, p < 0.001), with stakeholder trust serving as a significant partial mediator (indirect effect = 0.31, 95% CI [0.22, 0.41]). Multi-group analysis reveals significant structural differences between SME and MNC respondents, with trust playing a stronger mediating role in SME contexts. Environmental focus emerges as the most influential dimension of CSR quality perception in MNCs, while community impact dominates in SME contexts. The paper concludes with managerial implications for enhancing CSR communication strategies and policy recommendations for differentiating CSR frameworks by firm size.

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