CORPORATE SOCIAL RESPONSIBILITY PRACTICES AND CUSTOMER SATISFACTION: INSIGHTS FROM COMMERCIAL BANKS IN NAIROBI CITY COUNTY, KENYA
Esther Njeri Njiri - Master’s Student, Department of Business Administration, Kenyatta University, Kenya
Dr. Patricia Kungu (PhD) - Senior Lecturer, Department of Business Administration, Kenyatta University, Kenya
ABSTRACT
Customer satisfaction is a critical metric for evaluating organizational success in the service sector, as customer perceptions strongly influence competitiveness, loyalty, and brand positioning. However, despite advancements in service quality, digital banking, and financial inclusion, customer satisfaction levels in Kenya’s banking sector have remained inconsistent. Recent statistics indicate a decline in key indicators, with the Net Promoter Score dropping from 44% in 2024 to 38% in early 2025, alongside fluctuating Customer Retention Rates and unstable Customer Satisfaction Index scores. These trends highlight growing challenges in meeting evolving customer expectations, particularly as customers become more environmentally conscious. This study aimed to examine the corporate social responsibility effects on the customer satisfaction of commercial banks in Nairobi City County, Kenya. The study objectives were: to evaluate the effect of environmental philanthropy, environmental community involvement and environmental customer well-being on customer satisfaction of commercial banks in Nairobi City County, Kenya. The research was guided by Stakeholder Theory, Social Identity Theory and Corporate Social Responsibility Pyramid model. The study employed an explanatory research design. The population targeted comprises of 195 senior managers, 390 middle-level managers, 585 supervisors, and 1950 corporate customers. The Yamane formula was applied to evaluate the sample size of 97 participants. The gathered data were analyzed via quantitative and qualitative methods. Descriptive and inferential statistical analyses were applied to the quantitative data, utilizing Statistical Package for Social Sciences version 27. To explore the relations between corporate social responsibility and customer satisfaction, techniques like multiple regression and correlation analyses were utilized. The results demonstrated a solid positive relationship (R = 0.812) between corporate social responsibility and customer satisfaction of commercial banks in Nairobi City County. Additionally, a p-value of 0.000 validated the statistical significance of the entire regression model, indicating that the three dimensions of environmental CSR have a combined impact on customer satisfaction. The research concludes that these environmental CSR initiatives greatly improve customer satisfaction in the commercial banks of Nairobi City County by strengthening corporate reputation, establishing trust, and encouraging long-term customer loyalty. The study recommends that commercial bank managers prioritize investments in environmental philanthropy, expand community participation in environmental conservation programmes, and integrate environmentally sustainable practices into their core business operations to improve customer satisfaction.