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Research on Behavior and Competitive Advantage of Corporations’ Contribution to Non-profit Organizations

Author: TianXueYing
Tutor: CaiNing
School: Zhejiang University
Course: Business management
Keywords: corporate giving non-profit organizations characteristics of contribution corporate social capital competitive advantage
CLC: D632.9
Type: PhD thesis
Year: 2008
Downloads: 1158
Quote: 12
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As a principal form of organization, non-profit organization (NPO) has grown vigorously and played an important role in global social, economic and political fields since the 1980s. With the rapid progress of global economic integration, more and more limitations appear in traditional production factors that enhance the competitive advantages of firms. So the firms have to seek new points of economic growth. As an effective way to share corporate social responsibility (CSR), it is significant for corporation to contribute to NPOs. Most of existing studies focus on discussion of corporate philanthropy itself, and few efforts have been devoted to justifying the relationship between philanthropy and strategy. Therefore, the differentiated performance of firms which take part in the philanthropy is not known to other firms.From the perspective of corporate social capital, this study takes the firm involved in philanthropy as the research object and does a tentative work through explaining the relationship between corporate giving and competitive advantages of the firm. At first, this paper starts with a qualitative and quantitative description of corporations’ giving, including motive, structure and management. According to the theory of corporate philanthropy and CSR, this paper defines five characteristics of the corporate giving. And then, by clearing about the relationship between the characteristics of contribution, the corporate social capital and the competitive advantage of firms, a concept framework is built, and the mechanism of the effects of the characteristics of contribution on the firm is discussed. At last, the research used data from 290 firms in Yangtze River delta involved in contribution from the year 2004 to 2006. During the procedure of data processing, some methods such as descriptive statistics analysis, and confirmatory factor analysis (CFA) were used. Based on the analysis and test by the structural equation modeling (SEM), the concept model was modified properly and the final model was drawn. So this mechanism was confirmed by the experiential research, which showed the extent that how the characteristics of contribution affected on the firm’s competitive advantages. This paper indicated some new advisements begotten by the mechanism about the practice of corporate giving.Based on the theoretical and empirical studies, some conclusions can be achieved as follows: (1) The research establishes a contents system of corporations’ giving behaviors, incorporates theory of corporate philanthropy systematically, and emphasizes the importance of application in corporate strategy management. (2) According to the overall analysis of the behavior of corporate giving, this paper summarizes its characteristics and makes a comparative research into the difference in giving behaviors between domestic and foreign enterprises. In general, foreign enterprises are better than domestic enterprises in motive, structure and management of contribution. (3) The behavior of corporate giving can be reified to different kinds of characteristics, and these identified characteristics have different modes of effects on the competitive advantages of firms. (4) The characteristics of contribution have indirect influence on the firm’s competitive advantages. They are through the transfer of social capital in firms and then enhance the competitive advantages of firms by acquiring information, technology and knowledge. (5) Finally, this study proposed some effective policies to encourage firm to participate in philanthropy, including advocating the idea of corporate citizenship, applying tax preference to firms and regulating NPO’s development to raise their public credibility.While applying existing theories and methods, this paper does some tentative work of theoretical innovation as follows: (1) From the perspective of corporate social capital, this study not only relates corporate giving with competitive advantage, but makes an extension to the applied range of theory of competitive advantage. Consequently, a logic framework is constructed and perfected. (2) According to large sample investigation, this paper makes a qualitative and quantitative description of corporate giving, and reveals its characteristics. (3) Through exposing the mechanism of the effects of the characteristics of contribution on competitive advantages of firms, the study points out that one of the reasons which causes the difference in firm’s competitive advantages, that is, corporations’ contributions help to build good images and reputation. This attempt initiates another approach to studying the competitive advantages of firms innovatively. (4) The method of SEM is applied in research work to verify the conjunction mechanism between contribution and competitive advantages of a firm, and then the interaction between them is exposed. These provide an instructive support for others’ study in correlative field.At last, the conclusion part of this paper indicates the limitations of this study and provides some ideas for further research.

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