Corporate social responsibility in health sector: a case study in the government hospitals in Medan, Indonesia
Abstract
Contemporary society demands that every organization operate with a sense of social responsibility. Many organizations now include corporate social responsibility (CSR) activities in their work programs. In the health sector, however, the role of CSR has not been studied as intensively as in private corporations because the services provided by the health sector are already valued as directly serving humanity. This research aims to evaluate the impact of CSR on the health sector, specifically on government hospitals. This model was developed by analyzing the influence of CSR on hospital reputation, customer loyalty, and hospital values. By answering questionnaires, a total of 200 hospital patients from four government hospitals participated in the study. The proposed model was evaluated using path analysis with AMOS tools. The results of this study provide empirical evidence that overall, CSR positively affects the reputation of the hospital, patient loyalty, and hospital value. Although there is a direct negative effect of CSR on hospital value, the larger influence of indirect effect that occurs through the mediating role of reputation and patient loyalty variables shows that CSR is able to increase the hospital value. Practically, these results imply that CSR should be applied as a strategic tool in improving the value of the hospital.
Keyword : corporate social responsibility, hospital reputation, customer loyalty, hospital value
How to Cite
Lubis, A. N. (2018). Corporate social responsibility in health sector: a case study in the government hospitals in Medan, Indonesia. Business: Theory and Practice, 19, 25-36. https://doi.org/10.3846/btp.2018.04
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Eccles RG, Newquist SC, Schatz R (2007) Reputation and its risks. Harvard Business Review 85 (2): 104-114.
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Grandón KLR and Reinoso LAA (2016) Social responsibility of healthcare organizations and the role of the nurse. In: Hand-book of Research on Social Entrepreneurship and Solidarity Economics. IGI Global, 453-474. https://doi.org/10.4018/978-1-5225-0097-1.ch022
Haghkhah A, Hamid AB, Ebrahimpour A, Roghanian P, Gheysari H (2013) Commitment and customer loyalty in business-to-business context. European Journal of Business and Manage-ment 5 (19): 156-164.
Handayani R, Wahyudi S, Suharnomo S (2017) The effects of corporate social responsibility on manufacturing industry performance: the mediating role of social collaboration and green innovation. Business: Theory and Practice 18: 152-159. https://doi.org/10.3846/btp.2017.016
Helm S, Eggert A, Garnefeld I (2010) Modeling the impact of corporate reputation on customer satisfaction and loyalty using partial least squares. In: Vinzi VE, Chin WW, Henseler J, Wang H (Eds) Handbook of partial least squares: concepts, methods and applications. Springer, 515-534. https://doi.org/10.1007/978-3-540-32827-8_23
Helm S, Tolsdorf J (2013) How does corporate reputation affect customer loyalty in a corporate crisis? Journal of Contingen-cies and Crisis Management 21 (3): 144-152.
Inleh O, Bartlett JL, May S (2011) Corporate social responsibil-ity and communication. In: Ihlen O, Bartlett JL, May S (Eds) The Handbook of Communication and Corporate Social Responsibility. Chichester: Wiley-Blackwell, 3-22. https://doi.org/10.1002/9781118083246
Ismail M (2009) Corporate social responsibility and its role in community development: an international perspective. Jour-nal of International Social Research 2 (9).
Keh HT, Xie Y (2009) Corporate reputation and customer be-havioral intentions: the roles of trust, identification and com-mitment. Industrial marketing management 38 (7): 732-742. https://doi.org/10.1016/j.indmarman.2008.02.005
Keiningham TL, Aksoy L, Cooil B, Andreassen TW, Williams L (2008) A holistic examination of Net Promoter. Journal of Database Marketing & Customer Strategy Management 15 (2): 79-90.
Khan HUZ (2010) The effect of corporate governance elements on corporate social responsibility (CSR) reporting: empirical evidence from private commercial banks of Bangladesh. In-ternational Journal of Law and Management 52 (2): 82-109. https://doi.org/10.1108/17542431011029406
Knight RF, Pretty DJ (2001) Reputation and value: the case of corporate catastrophes. London: Oxford Metrica.
Korkchi S, Rombaut A (2007) Corporate social responsibility: a case study on private and public corporations in Sweden. Bachelor thesis, Institution for Business Administration and Economics, South Stockholm University- Södertörn School of Economics and Business Studies (EcoBus). http://www.diva-portal.org/smash/get/diva2:16710/fulltext01
Kotler P, Keller KL (2012) Marketing management(14th ed). New Jersey: Prentice Hall. Kotler P, Lee N (2008) Corporate social responsibility: doing the most good for your company and your cause. John Wiley & Sons.
Kurniawan R (2017) Effect of environmental performance on environmental disclosures of manufacturing, mining and plantation companies listed in Indonesia stock exchange. Arthatama: Journal of Business Management and Account-ing1 (1): 6-17.
Lai CS, Chiu CJ, Yang CF, Pai DC (2010) The effects of corporate social responsibility on brand performance: the mediating ef-fect of industrial brand equity and corporate reputation. Jour-nal of business ethics 95 (3): 457-469. https://doi.org/10.1007/s10551-010-0433-1
Lee MDP (2008) A review of the theories of corporate social responsibility: its evolutionary path and the road ahead. In-ternational journal of management reviews 10 (1): 53-73. https://doi.org/10.1111/j.1468-2370.2007.00226.x
Lev B (2013) Corporate Social Responsibility: Doing Good or Wasting Shareholders’ Money? http://people.stern.nyu.edu/blev/presentations/Corporate%20Social%20Responsibility%20-%20Jul%202013.pdf
Lima Crisóstomo V, de Souza Freire F, Cortes de Vasconcellos F (2011) Corporate social responsibility, firm value and finan-cial performance in Brazil. Social Responsibility Journal 7 (2): 295-309. https://doi.org/10.1108/17471111111141549
Luo X, Bhattacharya CB (2006) Corporate social responsibility, customer satisfaction, and market value. Journal of market-ing 70 (4): 1-18. https://doi.org/10.1509/jmkg.70.4.1
Mandhachitara R, Poolthong Y (2011) A model of cus-tomer loyalty and corporate social responsibility. Jour-nal of Services Marketing 25 (2): 122-133. https://doi.org/10.1108/08876041111119840
Marin L, Ruiz S, Rubio A (2009) The role of identity salience in the effects of corporate social responsibility on consumer behavior. Journal of Business Ethics 84: 65-78. https://doi.org/10.1007/s10551-008-9673-8
McWilliams A (2000) Corporate social responsibility. Wiley Encyclopedia of Management.
Meyer JA, Silow-Carroll S, Kutyla TMLA, Stepnick LS, Rybowski LS (2004) Hospital quality: ingredients for success – overview and lessons learned. New York, NY: The Commonwealth Fund.
Morsing M, Schultz M (2006) Corporate social responsibility communication: stakeholder information, response and in-volvement strategies. Business Ethics: A European Review 15 (4): 323-338. https://doi.org/10.1111/j.1467-8608.2006.00460.x
Mostafa MM (2005) An empirical study of patients’ expectations and satisfactions in Egyptian hospitals. International Journal of Health Care Quality Assurance 18 (7): 516-532. https://doi.org/10.1108/09526860510627201
Mukhopadhyay K, Prathima VG, Jayashree V (2014) Critical appraisal of work values of hospital leaders-a case study con-ducted in reputed private hospital, Bangalore. International Journal on Leadership 2 (1): 23.
Naidu A (2009) Factors affecting patient satisfaction and healthcare quality. International journal of health care quality assurance 22 (4): 366-381. https://doi.org/10.1108/09526860910964834
Nasieku T, Togun OR, Olubunmi EM (2014) Corporate social responsibility and organizational performance: a theoretical review. International Journal of Humanities, Social Sciences and Education1(12), 106-114.
Nicklin W, Dickson S (2009) The value and impact of accreditation in health care: a review of the literature. Canada: Accredita-tion Canada.
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