The role of stakeholder dialogue in enhancing private sector support in addressing healthcare issues in Tanzania through Corporate Social Responsibility (CSR)

Abstract

There are limited number of private sector companies practicing Corporate Social Responsibility (CSR) in the Tanzanian health sector due to lack of stakeholder dialogue. As a result, company perceptions about the roles that their CSR interventions could play in addressing stakeholders’ health and safety expectations are limited. The lack of dialogue between companies and stakeholders such as customers, employees, communities and the government limits the freedom of both parties to express their concerns and reach a mutually beneficial solution. To encourage companies’ participation, literature shows that through stakeholder dialogue, companies could create positive relationships with their stakeholders, leading to increased employee morale, creativity, operational efficiency, and stakeholder satisfaction and commitment. However, there is limited empirical research that had tested the effect of stakeholder dialogue in facilitating private sector support in healthcare. To fill the literature gap, this study examines the mediating role of stakeholder dialogue in enhancing private sector CSR interventions in healthcare. Questionnaire survey was used to collect 441 responses from private companies in Tanzania and data were analyzed by using Structural Equation Modeling (SEM) approach. Findings show that while larger companies are more focused on fulfilling their customers’ expectations, small and medium companies practiced CSR in healthcare just to fulfill two stakeholders’ expectations: communities and government. Nevertheless, both large and small and medium companies would consider other stakeholders’ health and safety expectations if an open and transparent dialogue is arranged. This study contributes to the body of knowledge by extending Donaldson and Preston's (1995) stakeholder model by including a mediating variable: stakeholder dialogue. The study could also provide useful indication to policy makers and private sector practitioners in planning strategic policies that will increase private sector involvement in healthcare through CSR interventions. In this way, more Tanzanians irrespective of their stakeholder status can get better healthcare services.