EFFECT OF CSR IN HOTEL

INDUSTRY
A case study on effect of CSR activities in hotel of Delhi-NCR region,2019.

Submitted by

Rahul Jha

NCHM Roll No: 1741207083

IGNOU Roll No: 179067740

 INDEX

CONTENT

1. WHAT IS CORPORATE SOCIAL

RESPONSIBILITY

2. EFFECTS OF CSR ON

A. SUSTAINABILITY

B. EMPLOYEES

C. LEADERSHIP

D. CONSUMERS

REFERENCE
WHAT IS CORPORATE SOCIAL RESPONSIBILITY?

There are several definitions for Corporate Social Responsibility. The following are a few
definitions put forward by several researchers and theorists. Thorough studies of the business
environment, HR literature and the global economic changes have created both narrow and
broad definitions for the term ‘Corporate Social Responsibility’. The basic understanding of
CSR changes, and its definition can be seen as follows:
(Bowen, 1953) “The obligations of businessmen to pursue those policies, to make those
decisions, or to follow those lines of action which are desirable in terms of the objectives and
values of our society.”
(Drucker, 1954) “It has to consider whether the action is likely to promote the public good,
advance the basic beliefs of our society, contribute to its stability, strength, and harmony.”
(Brown & Dacin, 1997)
“A corporate status and activities with respect to its perceived societal or, at least,
stakeholder obligations.” (Matten & Moon, 2004)
“CSR is a cluster concept which overlaps with such concepts as business ethics, corporate
philanthropy, corporate citizenship, sustainability, and environmental responsibility. It is a
dynamic and contestable concept that is embedded in each social, political, economic and
institutional context.
(Lord Holme and Richard Watts,2013) used the following definition:
Corporate Social Responsibility is the continuing commitment by business to behave
ethically and contribute to economic development while improving the quality of life of
the workforce and their families as well as of the local community and society at large.

EFFECTS OF CSR

A. SUSTAINABILITY
A case study of a large sample of the UAE hotels is used to collect and analyze empirical
data. The purpose of this paper is to empirically assess the impact of integrated lean and
green practices on the sustainable (environmental, economic and social) performance of a
hotel supply chain.(Hussain, M., Al-Aomar, R. and Melhem H,2019)” The proposed
assessment model is expected to be of great value toward the effective implementation of
LeGreen practices across hotel supply chains in the UAE and globally. The study findings
also provide guidelines for practitioners within the hospitality sector to undertake the
proposed model and to adapt it for assessing and enhancing sustainable performance in other
sectors of the service industry.”
The results showed that three major lean techniques (Kaizen, quality and productive
maintenance) and three green techniques (health and safety, waste disposal and green
certifications) have substantial impact on the sustainable performance of hotel supply chains.
Further results revealed that LeGreen impacts are complementary. Lean techniques have the
highest impact on the economic performance of the hotel supply chain and the least impact
on the environmental performance. Green practices, on the other hand, have opposite
impacts.

Another study aims to understand whether poverty alleviation can be realized in tourism via
tourism cooperatives. As a fast-growing industry in the world, tourism has accelerated
economic development in many participating places.( Yang, X. and Hung, K.,2014)
“ Evidence from Yuhu suggested that resources and power changes, both of which are further
divided into both individual and collective levels, are the main contributors to substantial
improvements of the poor. Material and social resources were significantly accumulated. In
addition, empowerment, referring to the improvements in status, legitimacy and
capability/knowledge, facilitated villagers to obtain favourable policies. By embracing a more
broad understanding of poverty, the tourism cooperative is proven to effectively alleviate the
poverty suffering of Yuhu villagers.”

Do ethical and sustainable practices matter.( Wang, C. ,2014) “The results show that ethical
and sustainable practices of corporate citizenship have positive effects on employee affective
organizational commitment, organizational innovation and customer loyalty, while affective
organizational commitment, innovation and customer loyalty all have positive effects on
business performance. Most important of all, bootstrap estimations based on SEM show that
corporate citizenship has indirect positive effects on business performance through the
mediating roles of affective organizational commitment, innovation and customer loyalty. “
Another study aims to explore the expectations and perceptions of corporate social
responsibility (CSR) strategies among Chinese fast-food diners. (Xu, Y.,2014) Results from
the study show that the Chinese fast food diners expect restaurant companies to attach more
importance to “(product) nutrition and well-being (of customers)” and “environment
sustainability” to be considered socially responsible. CSR performance was found to be the
most influential factor in the consumers’ loyalty behaviors compared to customer satisfaction
with service, product and the total visit experience. The study also found that many of
McDonald’s CSR activities were unknown to the Chinese respondents.

The authors’ focus is on the way in which sustainability and corporate social responsibility
(CSR) discourses and practices emerge in the collaboration of multinational companies
(MNCs) with the local hotels in developing country contexts. (Ertuna, B., Karatas-Ozkan,
M. and Yamak, S. ,2019), Some components of CSR and sustainability logics developed in
the headquarters diffuse into local affiliate hotel, not all. Local affiliate hotels seek to
acquire local legitimacy in their host environment, despite a standard format imposed by
their headquarters. Local necessities and priorities translate themselves into such initiatives
in a very limited way in the affiliates of the Hilton where there is mostly a top-down
approach. Similar approach has also been observed in the case of the local hotel which is
part of a family business group. Family’s values and family business headquarter shape the
CSR and sustainability strategy and the logics reflecting the local component.
 B. EMPLOYEES

The effect of CSR involvement by any organisation can be concluded by these sets of study
results:
(Aminudin, 2013) Research has analyzed the perceptions employees have on CSR issues and
their reactions. Studies conclude that CSR is a key element for the retention of employees.”
(Raub & Blunschi, 2014; Zientara, Kujawski, & Bohdanowicz-Godfrey, 2015) “ employees’
awareness of CSR activities is positively related to job satisfaction”
(Fu, Ye, & Law, 2014; Park & Levy, 2014)”engagementand has positive effects on
organizational identity and commitment and, therefore, on organizational citizenship
behaviour”
(Tsai, Tsang, & Cheng, 2012).” Leadership styles in human resources departments directly
influence the employees’ behavior, and in this sense, the attributes of CSR that employees
most value are those related to innovation and commitment to the environment.”
Aminudin (2013) argues that CSR has become an employee retention tool, as it promotes
organizational identity, which, in practice, means that workers not only focus on the
operational functions of their work but also take into account the relationship with
the stakeholders, suppliers, community, customers, and environment. The more influencing
actions in terms of employee retention are concern about environmental issues (inside and
outside the organization), the intrinsic motivation (employees are rewarded promptly when
they improve their performance), the promotion and development of creativity, socialization
of their ideas, and the provision of training when required.
The purpose of this paper is to investigate the perceptions of employees of luxury chain
hotels situated in Delhi and NCR, India in relation to corporate social responsibility (CSR)
(Sharma, S. and Mishra, P.,2019)”It was observed that CSR practices lead to higher
employee motivation and job retention and that this has a positive impact on corporate
performance. Hotel employees (supervisor and managers) perceive skilling uneducated
people as a positive CSR initiative.”

C. LEADERSHIP

(Lantos, G.,2002) ”This commentary questions commonly held assumptions about corporate
social responsibility (CSR). It discusses the morality of altruistic CSR – philanthropic CSR
activities that are not necessarily beneficial to the firm’s financial position. Evaluating
altruistic CSR from all major ethical perspectives – utilitarianism, rights, justice and care –
leads to the conclusion that, for publicly held corporations, such activity is immoral. This is
because altruistic CSR violates shareholder property rights.”
With perspective of travel and tourism managers at world heritage sites.
(Anna Farmaki ,2019) ”The findings indicate that managers’ place attachment, their heritage
value identification and their perceptions of positive tourism impacts affect their CSR
attitudes. However, the negative effects of tourism do not significantly influence CSR
attitudes. Data collected through open-ended questions incorporated in the structured survey
have provided justification for the insignificant relationship.”

(Benavides-Velasco, Quintana-García, & Marchante-Lara, 2014).”CSR practices in

conjunction with TQM (total quality management) have also a positive influence on business
results because of the benefits generated to customers which, in turn, positively influence
hotel’s operations.”
Another study aims to examine stakeholder interests in and influence on corporate social
responsibility (CSR) implementation in hotels through an instrumental stakeholder theory
lens. (Gopalkrishnan R. Iyer, Lee Jarvis ,2019) “There is a dominance of supply-chain
stakeholder interests which in turn outline the CSR orientation of hotels, whereas stakeholder
influence, largely shaped by the interdependent, multi-faceted nature of the tourism industry,
conditions the implementation of CSR in hotels. Interestingly, stakeholder influence on CSR
in hotels is not corresponding to stakeholders’ perceived saliency, indicating that stakeholder
analysis needs to move beyond the consideration of salient stakeholders’ interests.”
A researh paper to examine corporate social responsibility (CSR) issues in the context of the
hospitality industry. (MacKenzie, N. and Gannon, M. ,2019) Based on prior literature, four
CSR domains were identified as instrumental, social/legal/political, ethical and
environmental. CSR issues in hospitality research have predominantly focused on the
instrumental domain while there is scant research on other domains. CSR adoption in the
multinational context was identified as due from stakeholder pressures, competitive
environment and cultural environment.
The authors use two historical case studies (UK and Costa Rica) to explore the antecedents
and legitimisation of sustainable development in hospitality and tourism, Issues surrounding
sustainability in hospitality and tourism are longstanding and impacted by their situated
context. In considering “bottom-up” and “top-down” approaches, this study finds that the
private-sector is critical in legitimising tourism and hospitality development through
addressing sustainability aims.

D. CONSUMER

Customer willingness to pay a price premium for hotel’s more responsible behavior is a
question still under researched. (K. H. Kang, Stein, Heo, and Lee ,2012) “examined hotel
guests’ willingness to pay a premium for environmentally friendly and sustainable practices
of the U.S. hotel industry finding a higher willingness to pay among guests with higher
degrees of environmental concern and those lodged at luxury and mispriced hotel guests in
comparison with economy hotel guests.
Another paper aims to investigate how corporate social responsibility (CSR) performance
(i.e. to the environment, society and stakeholders) and perceived brand quality influence
brand preference. (Tingchi Liu, M., Anthony Wong, I., Shi, G., Chu, R. and L. Brock,
J. ,2014) “Customers’ brand preference can be enhanced by CSR performance. Performance
in each of the three CSR domains (i.e. environment, society and stakeholders) positively
impacts brand preference, although to different degrees. The impact of CSR on stakeholders
has the strongest influence on Chinese customers’ brand preference among the three CSR
domains. Perceived brand quality was found to be a mediator of the relationship between
CSR performance and brand preference.”
REFERENCES

Anna Farmaki
International Journal of Contemporary Hospitality Management
ISSN: 0959-6119

Aminudin, M. (2013). Corporate social responsibility and employee retention of “green”

hotels. Procedia-Social and Behavioral Sciences, 105, 763-771.
Google Scholar | Crossref

Brown, T., & Dacin, P. (1997). The Company and the product: Corporate Associations and
Consumer Product Responses. Journal of Marketing, 61(1), 68-84

Benavides-Velasco, C. A., Quintana-García, C., Marchante-Lara, M. (2014). Total quality

management, corporate social responsibility and performance in the hotel industry.
International Journal of Hospitality Management, 41, 77-87.
Google Scholar | Crossref | ISI

Christina Geng-qing Chi, Chaozhi Zhang, Yuanyuan Liu

International Journal of Contemporary Hospitality Management
ISSN: 0959-6119

Drucker, P. (1954). The Practice of Management. New York: Collins.

Ertuna, B., Karatas-Ozkan, M. and Yamak, S. (2019), "Diffusion of sustainability and CSR
discourse in hospitality industry", International Journal of Contemporary Hospitality
Management, Vol. 31 No. 6, pp. 2564-2581.

Fu, H., Ye, B. H., Law, R. (2014). You do well and I do well? The behavioral consequences
of corporate social responsibility. International Journal of Hospitality Management, 40, 62-
70.
Google Scholar | Crossref | ISI

Gopalkrishnan R. Iyer, Lee Jarvis

International Journal of Contemporary Hospitality Management
ISSN: 0959-6119
Publication date: 10 June 2019

Hussain, M., Al-Aomar, R. and Melhem, H. (2019), "Assessment of lean-green practices on

the sustainable performance of hotel supply chains", International Journal of Contemporary
Hospitality Management, Vol. 31 No. 6, pp. 2448-2467. https://doi.org/10.1108/IJCHM-05-
2018-0380

Kang, K. H., Stein, L., Heo, C. Y., Lee, S. (2012). Consumers’ willingness to pay for green
initiatives of the hotel industry. International Journal of Hospitality Management, 31, 2564-
2572.
Google Scholar | Crossref | ISI

Lantos, G. (2002), "The ethicality of altruistic corporate social responsibility", Journal of

Consumer Marketing, Vol. 19 No. 3, pp. 205-232.

MacKenzie, N. and Gannon, M. (2019), "Exploring the antecedents of sustainable tourism

development", International Journal of Contemporary Hospitality Management, Vol. 31 No.
6, pp. 2411-2427. https://doi.org/10.1108/IJCHM-05-2018-0384

Sharma, S. and Mishra, P. (2019), "Hotel employees’ perceptions about CSR initiatives and
there potential to support the skill India initiative", Worldwide Hospitality and Tourism
Themes,

Tingchi Liu, M., Anthony Wong, I., Shi, G., Chu, R. and L. Brock, J. (2014), "The impact of
corporate social responsibility (CSR) performance and perceived brand quality on customer-
based brand preference", Journal of Services Marketing, Vol. 28 No. 3, pp. 181-
194. https://doi.org/10.1108/JSM-09-2012-0171

Matloub Hussain, Raid Al-Aomar, Hussein Melhem

International Journal of Contemporary Hospitality Management
ISSN: 0959-6119
Publication date: 10 June 2019

Wang, C. (2014), "Do ethical and sustainable practices matter?", International Journal of
Contemporary Hospitality Management, Vol. 26 No. 6, pp. 930-
947. https://doi.org/10.1108/IJCHM-01-2013-0001

Xu, Y. (2014), "Understanding CSR from the perspective of Chinese diners: the case of
McDonald’s", International Journal of Contemporary Hospitality Management, Vol. 26 No.
6, pp. 1002-1020. https://doi.org/10.1108/IJCHM-01-2013-0051

Yang, X. and Hung, K. (2014), "Poverty alleviation via tourism cooperatives in China: the
story of Yuhu", International Journal of Contemporary Hospitality Management, Vol. 26 No.
6, pp. 879-906. https://doi.org/10.1108/IJCHM-02-2013-0085