Internal social responsibility and the lohn production. Case study: a small firm from textile industry with foreign capital

Nicoleta Racolta-Paina () and Veronica Maria Mateescu
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Veronica Maria Mateescu: École doctorale "Entreprise Travail Emploi”: Sciences économiques Université de Marne-la-Vallée Paris

Management & Marketing, 2006, vol. 1, issue 3

Abstract: At present, the business social responsibility is considered by a costs-benefits perspective, one of its most important benefits being that it can constitute a competitive advantage source for large enterprises as well as for the small and medium-sized enterprises (SMEs). For the SMEs that have a lower financial power, the most recommended is the internal social responsibility (ISR), oriented toward enterprise employees, because of its low costs and important benefits that can generate competitive advantage. A special case is represented by the SMEs operating on the basis of outward processing trade type of subcontracting, a business form characteristic for a large number of foreign investments operating on the Romanian market in the clothing industry, their competitive advantage being represented by the low cost production; it implies, also, a low cost of the workforce. In these conditions, one raises the question of the existence of ISR and of its forms of manifestations, the main hypothesis being that if the ISR exists, it is limited by the pursued advantage of the lowest costs possible and it is not formally practiced. This hypothesis was partially confirmed by the results of our case study, the most important finding being that of the necessity for the enterprise to practice some forms of ISR, as a result of contextual factors (cultural and socio-economical) influence, in order to efficiently function, it couldn't be possible only through the pursuit of low costs competitive advantage.

Keywords: internal social responsibility; competitive advantage; SMEs; lohn (outward processing trade); clothing industry; case study. (search for similar items in EconPapers)
Date: 2006
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