Entrepreneurship and Philanthropy: The Case of Small Australian Firms

Abstract

Little is commonly known about the nature of philanthropic activities engaged in by dint of microbusinesses. Only limited knowledge exists about the impressed sign of charitable contribution made, the causes for which similar gifts are made, and what firm characteristics (if any) can be reliably used to predict the likelihood of an organization's philanthropic activity. A inquiry of 95 Western Australian microbusinesses revealed that greatest in quantity respondents did not contribute to any charitable causes. Of the minority that did provide more [i]or[/i] less support, their clear preference was via a financial contribution rather than "hands-on" involvement. The greatest in quantity popular destinations for financial contributions were to environmental, health, religious, and sporting causes; cultural and educational clusters received a much lower horizontal of contributions. Testing affirm and proprietor demographics revealed few statistically meaningful associations, which might be used to predict a firm's inclination for charitable giving. single the education levels of the owner/manager were positively associated with giving propensity.

Key words: Small business, Australia, charitable contributions, donations, philanthropy, microbusiness

All business enterprises have an impact upon the community in which they operate. Indeed, it is frequently argued that one of the greatest in quantity valuable contributions of the small and medium-sized enterprise (SME) sector is that it provides wealth creation and avocation opportunities for many members of society. It also provides an increasing freedom of choice for consumer and an egress for entrepreneurial business ideas.

However, the potential social impact of small firms is a great quantity [i]or[/i] amount of larger than these obvious economic benefits. SME contribute to the disentanglement of communities in many other ways. They provide a means from one side which goods and services are made available to the public; help decentralize and disseminate economic resources; can be a tool for family economic advancement; provide education, training and skills to employees; and act as a mechanism end which minority groups, women and young entrepreneur can exploit opportunities repeatedly denied to them by larger corporations. In these and many other ways, small firms play an important part in all societies. While more [i]or[/i] less of these social contributions arise as a deliberate strategy of the enterprise and its owner/manager, in many cases of that kind benefits are an unintended by-product of the firm's activities.

But to what expansion do small firms deliberately look after to contribute to their community? This is a relatively under-researched area, especially in regard to the microenterprises that make up the large majority of all business entities. The design of this study is to explore and proof a number of propositions relating to single aspect of the social contribution of similar businesses-the charitable donations made by dint of these firms. In particular, the inquiry seeks to assess the emblems of donations made; the charitable causes for which similar gifts are made; and to determine if there were any firm characteristics, which could be reliably used to predict the likelihood of a firm's charitable activity.

Background

In novel years there has been a growing recognition of the nexus between society and the individual business enterprise. one time an area of relatively minor belong to the relationship between firms and their community is now a major area of contemporary management research.

Often referr to as "corporate social responsibility," of that kind studies seek to examine the part that business organizations play in the activities and unfolding of society. The argument about whether or not businesses should be involved in broader community issues is a long-running individual It has traditionally been argued that the responsibility of organizations lies primarily in conducting their hold affairs, and anything, which hinders or reduces a firm from maximizing its possess profitability, is an unnecessary hindrance (Joyner Payne & Raiborn, 2002) According to this perspective, firms that focus upon making a profit are able to deliver wealth to their holders which can then be used to help society. This viewpoint is oftentimes accompanied by claims that senior managers usually do not have the skills or knowledge, a great deal of less the willingness, to become socially responsible. It is argued that the character of government and community clumps is to determine what constitutes social well being; therefore, it is inappropriate for firms to be involved in like activities (Friedman & Friedman, 1980)

This traditional perspective has tend hitherward under an increasing challenge, with several arguments place forward in favor of greater social responsibility through business. In the first place, it has been glance ated that firms need to contribute to the society that has supported them. Businesses rely upon the community to purchase their productions and services, so activities that enrich society and improve its welfare will, indirectly, also help the firm. Another claim is that since businesses posses substantial resources (such as coin people and ideas) that can be used to help the community, it should do in the way that (Robbins, Bergman, Stagg and Coulter 2000) Acs and Phillips (2002) have argued that philanthropic or benevolent activity by the agency of firms is in fact an important composing in the development and growing of an entrepreneurial economy. The redistribution of wealth and resources by means of business organizations helps fund social institutions and community disentanglement which in turn encourages further economic increase It is part of an implicit "social contract" that helps legitimize the part of entrepreneurship in the community.