Business-community relations under COVID-19: A study of micro and small firms

Abstract

In considering the premises of social capital and stakeholder theory, this study examines the extent to which firm-community relationships were affected during the COVID-19 crisis, and the significance of firms for their community during this unprecedented event. Responses from 107 Italian micro and small firms were gathered through an online questionnaire. The findings first reveal a strengthening of relations, particularly between firms and other businesses in their community; however, participants’ comments also recognise no changes or even weakening relations. Second, three dimensions highlighting the significance of firms’ survival during the crisis emerged: the community context, underlining firms’ socioeconomic and symbolic contributions, the immediate stakeholders, emphasising contributions towards employment and support of local businesses, and the broader community-society context, underscoring firms’ contribution towards consumer and societal needs. The study proposes a conceptual framework illustrating various relationships between the findings and the considered conceptual underpinnings and suggests various implications.