COMPLIANCE WITH EQUITABLE TREATMENT OF STAKEHOLDERS AND THE PROFITABILITY OF MEDIUM SCALE ENTERPRISES IN GHANA

This research investigates the impact of compliance with equitable treatment of stakeholders on the profitability of medium scale enterprises in a Ghana using descriptive research design approach. The study has three specific objectives: to construct Ghanaian medium scale enterprises’ equitable treatment of stakeholders’ compliance index; to establish the correlation between Ghanaian medium scale enterprises’ equitable treatment of stakeholders and their profitability; and the measure the impact of compliance with equitable treatment of stakeholders on the profitability of Ghanaian MSEs. The work anchored on stakeholder theory, and sampled 1010 respondents across medium scale enterprises in Ghana. Parametric tests and inferential statistics (correlation and regression) were carried out. The study empirically proved that: Ghanaian medium scale enterprises’ aggregate compliance to equitable treatment of stakeholders is 45%; and that compliance to equitable treatment of stakeholders has statistical significant positive effect on the profitability of Ghanaian Medium Scale Enterprises. This study reveals that medium scale enterprises in Ghana should place more emphasis in compliance with equitable treatment of stakeholders since it significantly increases their profitability. Finally, the need to replicate this study in other emerging and developed economies is called for since there is serious dearth in literature on this topic currently.