Resource Allocation and Corporate Social Performance of Licensed Alcohol Manufacturing Firms in Kenya

Abstract

The alcohol manufacturing sector faces growing societal scrutiny due to alcohol-related harm, yet many firms struggle to integrate corporate social initiatives effectively. Globally, effective resource allocation is increasingly recognised as central to corporate social performance (CSP). In Sub-Saharan Africa, resource constraints heighten the need for strategic allocation to advance corporate social performance. In Kenya’s alcohol sector, manufacturing companies licensed by the National Authority for the Campaign against Alcohol and Drug Abuse (NACADA) face fragmented resource allocation, meaning the distribution of resources is uneven and poorly coordinated. These challenges hinder the effective integration of resource allocation practices into CSP, ultimately undermining strategic management in these firms. The objective of this study was to examine the effect of resource allocation on CSP. Its findings were significant as they guide managers, inform theory, and assist policymakers in enhancing resource allocation to improve CSP in regulated industries. The Resource-Based View theory guided this study. The study used a descriptive design to investigate the effects of resource allocation practices on CSP outcomes. A census survey of all 41 licensed alcohol manufacturing firms that held valid NACADA licenses as of March 2024 was conducted, focusing on managers directly involved in resource allocation. Of these, 37 companies were included in the main survey, while 4 companies participated in the pilot study. Structured questionnaires were used to collect primary data from three respondents from each of the 37 licensed alcohol manufacturing companies: one finance manager, one human resources manager, and one marketing and public relations manager, constituting a sample of 111 respondents selected using a purposive sampling technique. A pilot study assessed internal consistency, with Cronbach’s alpha ≥ 0.7 confirming the instrument’s reliability. Data analysis utilised descriptive statistical methods and regression analysis. Diagnostic tests assessed normality and multicollinearity to confirm linear regression assumptions and ensure accurate, reliable model results. The study findings showed that physical resource allocation (β = 0.412, p < 0.01) and human resource allocation (β = 0.367, p < 0.05) have a statistically significant positive effect on CSP, explaining 6.4% of the variance in CSP among licensed alcohol manufacturing firms in Kenya (R² = 0.064). The study therefore concludes that strategic allocation of physical and human resources is a key determinant of corporate social performance for firms in regulated industries.

Keywords: Alcohol manufacturing firms, corporate social performance, resource allocation, resource-based view, strategic management, Kenya.

DOI: 10.7176/EJBM/18-3-06

Publication date: March 28^th 2026