The Mediating Role of Service Quality in the Relationship Between Corporate Social Responsibility and Sustainable Competitive Advantages in an Emerging Economy

Abstract

ABSTRACT The Bank of Ghana and Companies Act provides a robust and secure framework for corporate social responsibility efforts by fostering openness and corporate accountability. The Ghana Banking Sector Code of Ethics advocates for ethical banking practices, encouraging sustainable growth. This study leveraged stakeholder theory to explore the mediating role of service quality in the relationship between corporate social responsibility and sustainable competitive advantage. A multistage sampling technique was employed to collect data from 373 employees of commercial banks in Ghana. The partial least squares structural equation modeling (PLS‐SEM) software was used to analyze the direct and indirect relationship between the variables. The study found that corporate social responsibility had a negative and insignificant impact on the sustainable competitive advantage of commercial banks in Ghana. The findings revealed that corporate social responsibility had a positive and significant relationship with service quality. The investigation also discovered that service quality had a positive and significant impact on sustainable competitive advantage. Finally, the study highlighted that service quality fully mediates the relationship between corporate social responsibility and sustainable competitive advantage. Commercial banks in Ghana should reassess their corporate social responsibility implementation strategy by adopting a comprehensive strategy framework to transform their corporate social responsibility activities into sustainable competitive advantage. They should use their corporate social responsibility activities to foster stakeholder trust, increase customer engagement, and build brand reputation.