Effects of Green Business Practices on an Organization’s Performance a case Study of Safaricom Limited, Nairobi-Kenya

Abstract

Green business practices are now an important area of focus for companies globally especially in Developed Countries. Rising temperatures, high fuel costs and changing weather patterns are considered as punishments for years of neglecting the environment and to this end Kenya is no exemption. This study sought to established how green business practices affect organizational performance. The specific objectives of the study were to: establish the various green business practices implemented at Safaricom; examine the effects of green business practices on financial wellbeing of Safaricom; examine the effect of the green business practices on Safaricom’s employee job satisfaction and finally discuss difficulties faced by Safaricom in implementing green business practices. The following null hypotheses were set as a guide: there are significant effects of green business practices on Safaricom’s profit; there is significant effect of green business practices on Safaricom’s employee’s job satisfaction. The target population of this study was 350 respondents drawn from Safaricom PLC headquarters Nairobi office. Stratified multistage simple random sampling technique was used where the sample was stratified into the 11 departments of Safaricom Limited that include Technology; Internal Audit; Financial Services; Resources; Customer Operations; Enterprise Business Unit, Business Development; Consumer Business Unit; Corporate security, Finance and Corporate Affairs. The sample was further clustered into four stages according to the position of employees in Safaricom which were senior management, managers, senior staff and junior staff. Finally, simple random sampling method was adopted in selecting 106 respondents where only 85 respondents completed and returned their questionnaires. The study used a questionnaire which consists of closed and open-ended questions for data collection. An interview guide was used to get data from key informants. To determine reliability, Cronbach’s alpha methodology was used. Descriptive statistics was adopted to analyse, show and interpret data while inferential examination which involves one-way ANOVA was conducted to find out the strength and the association concerning the dependent and independent variables. The paper reveals that Safaricom Limited has implemented several Green Business Practices which include; ISO 14001:2015-environemntal management system certification, energy efficiency and renewability, water conservation, waste management (domestic & electronic), conducting EIAs and EAs, planting trees, environmental awareness, trainings and sponsorships, carbon emission reduction strategies, green bond, sustainability champions & awards, green bond, green supply chain, green base stations, electromagnetic frequencies, green office, green products and services and sustainability reporting and environmental policy. It also established that there is noteworthy effect of green business practices on Safaricom’s profitability as well as employee’s job satisfaction. The main challenges faced were: technical barriers because there are some technologies that might not be available in the Country hence hindering the implementation of green business practices and Government legislation as there are little incentives provided by Kenyan Government to companies who are implementing green business practices, instead many are implementing on voluntary basis as opposed to other Countries where implementing attracts tax levies and other benefits. This study recommends that Kenya Bureau of Standard being the official standard body in the Country should develop Green standards that could guide companies willing to go green. Also, telecommunication companies should take advantage of the new Kenya energy act 2019 which allows for Net metering into the national grid as well as renewable energy feed in tariff system. The Government has further zero-rated green energy solutions and recycling of plastics which were identified as further incentives for companies willing to practice green business. Finally, organizations should build more capacities of their employees and invest in more research and development of green solutions as the study has revealed that green business practices increase profitability and employees’ job satisfaction.