ISSN: 2225-8329
Open access
Corporate Social Responsibility’s (CSR) impact exceeds beneficiary communities to include the practitioner companies itself. That impact on business-related aspects is more obvious on the financial performance of these companies relative to non-financial performances. Thus, this has become a hot subject for literature over the past 15 years to investigate. However, these literatures ended up by an ongoing argument on the type of impact that CSR places on corporate financial performance (CFP). Therefore, this paper aims to reorganize the findings of previous studies that had tested the impact of CSR on CFP to enable upcoming researchers to accurately understand the nature of mixed or conflicting findings approached by former researchers. Thus, enhancing chances of more effective research contributions on this particular front compared to existing knowledge. In that accordance, this paper classifies concerned literature review into six categories as follows: Firstly, studies that had reported a direct or complete positive impact of CSR dimensions on CFP in general. Secondly, studies that had reported a typical impact for all or some of CSR elements on certain dimensions of CFP. Thirdly, studies that had reported occasional or conditional impact of CSR dimensions on CFP. Fourthly, studies that had reported a negative impact for CSR on CFP. Fifthly, studies that had reported a role for moderating and mediating factors on the impact of CSR on CFP. Finally, studies that had offered some explanations for the mixed results on the relationship between CSR and CFP in particular and other aspects of corporate performance in general.
Benavides-Velasco, C., A., Quintana-García, C., & Marchante-Lara, M. (2014). Total quality management, corporate social responsibility and performance in the hotel industry. International Journal of Hospitality Management, 41, 77–87.
http://dx.doi.org/10.1016/j.ijhm.2014.05.003
Bhandari, A., & Javakhadze, D. (2017). Corporate social responsibility and capital allocation efficiency. Journal of Corporate Finance, 43, 354–377. http://dx.doi.org/10.1016/j.jcorpfin.2017.01.012
Blasi, S., Caporin, M., & Fontini, F. (2018). A Multidimensional Analysis of the Relationship Between Corporate Social Responsibility and Firms' Economic Performance. Ecological Economics, 147, 218-229. https://doi.org/10.1016/j.ecolecon.2018.01.014
Bocquet, R., Bas, C. L., Mothe, C., & Poussing, N. (2013). Are firms with different CSR profiles equally innovative? Empirical analysis with survey data. European Management Journal, 31, 642–654. http://dx.doi.org/10.1016/j.emj.2012.07.001
Cavazotte, F., & Chang, N., C. (2016). Internal Corporate Social Responsibility and Performance: A Study of Publicly Traded Companies. BAR - Brazilian Administration Review, 13 (4), 1-19. http://dx.doi.org/10.1590/1807-7692bar2016160083
Chang, C-H., & Sam, A.G. (2015). Corporate environmentalism and environmental innovation. Journal of Environmental Management, 153, 84-92. http://dx.doi.org/10.1016/j.jenvman.2015.01.010
Chauhan, S., & Amit. (2014). A relational study of firm’s characteristics and CSR expenditure. Procedia Economics and Finance, 11, 23 – 32. http://dx.doi.org/10.1016/S2212-5671(14)00172-5
Chen, L., Feldmann, A., & Tang, O. (2015). The relationship between disclosures of corporate social performance and financial performance: Evidences from GRI reports in manufacturing industry. Int. J. Production Economics, 170, 445–456. http://dx.doi.org/10.1016/j.ijpe.2015.04.004
Cho, S. Y., & Lee, C. (2017). Managerial Efficiency, Corporate Social Performance, and Corporate Financial Performance. Journal of Business Ethics. https://doi.org/10.1007/s10551-017-3760-7
García-Madariaga, J., & Rodríguez-Rivera, F. (2017). Corporate social responsibility, customer satisfaction, corporate reputation, and firms’ market value: Evidence from the automobile industry. Spanish Journal of Marketing – ESIC, 21(1), 39-53.
http://dx.doi.org/10.1016/j.sjme.2017.05.003
Goll, I., & Rasheed, A. A. (2004). The moderating effect of environmental munificence and dynamism on the relationship between discretionary social responsibility and firm performance. Journal of Business Ethics, 49(1), 41.
Gras-Gil, E., Manzano, M., P., & Fernández, J., H. (2016). Investigating the relationship between corporate social responsibility and earnings management: Evidence from Spain. Business Research Quarterly, 19(4), 289-299. http://dx.doi.org/10.1016/j.brq.2016.02.002
Grover, A. (2014). Importance of CSR in Inclusive Development. Procedia - Social and Behavioral Sciences, 157, 103 – 108. http://dx.doi.org/10.1016/j.sbspro.2014.11.013
Han, W., Zhuangxiong, Y., & Jie, L. (2017). Corporate social responsibility, product market competition, and product market performance. International Review of Economics and Finance xxx, 1–17. http://dx.doi.org/10.1016/j.iref.2018.03.019
Huang, C-C., Yen, S-W., Liu, C-Y., & Huang, P. (2014). The Relationship Among Corporate Social Responsibility, Service Quality, Corporate Image and Purchase Intention. International Journal of Organizational Innovation (Online), 6(3), 68-84.
Javed, M., Rashid, M., A., & Hussain, G. (2016). When does it pay to be good e A contingency perspective on corporate social and financial performance: would it work? Journal of Cleaner Production, 133, 1062-1073. http://dx.doi.org/10.1016/j.jclepro.2016.05.163
Jha, A., & Cox, J. (2015). Corporate social responsibility and social capital. Journal of Banking & Finance, 60, 252–270. http://dx.doi.org/10.1016/j.jbankfin.2015.08.003
Karaye, Y., I., Ishak, Z., & Che-Adam, N. (2014). The mediating effect of stakeholder influence capacity on the relationship between corporate social responsibility and corporate financial performance. Procedia - Social and Behavioral Sciences, 164, 528 – 534. http://dx.doi.org/10.1016/j.sbspro.2014.11.142
Laguir, I., Stagliano, R., & Elbaz, J. (2015). Does corporate social responsibility affect corporate tax aggressiveness? Journal of Cleaner Production, 107, 662-675.
http://dx.doi.org/10.1016/j.jclepro.2015.05.059
Li, D., Cao, C., Zhang, L., Chen, X., Ren, S., & Zhao, Y. (2017). Effects of corporate environmental responsibility on financial performance: The moderating role of government regulation and organizational slack. Journal of Cleaner Production166, 1323-1334.
http://dx.doi.org/10.1016/j.jclepro.2017.08.129
Madueño, J., H., Jorge, M., L., Conesa, I., M., & Martínez-Martínez, D. (2016). Relationship between corporate social responsibility and competitive performance in Spanish SMEs: Empirical evidence from a stakeholders' perspective. Business Research Quarterly, 19(1), 55-72. http://dx.doi.Org/10.1016/j.brq.2015.06.002
Maqbool, S., & Zameer, M., N. (2018). Corporate social responsibility and financial performance: An empirical analysis of Indian banks. Future Business Journal, 4, 84–93.
https://doi.org/10.1016/j.fbj.2017.12.002
Mehralian, G., Nazari, J., Zarei, L., & Rasekh, H., R. (2016). The effects of corporate social responsibility on organizational performance in the Iranian pharmaceutical industry: The mediating role of TQM. Journal of Cleaner Production, 135, 689-698.
http://dx.doi.org/10.1016/j.jclepro.2016.06.116
Nollet, J., Filis, G., & Mitrokostas, E. (2016). Corporate social responsibility and financial performance: A non-linear and disaggregated approach. Economic Modelling, 52, 400–407. http://dx.doi.org/10.1016/j.econmod.2015.09.019
Radhakrishnan, S., Chitrao, P., & Nagendra, A. (2014). Corporate Social Responsibility (CSR) in Market Driven Environment. Procedia Economics and Finance, 11, 68 – 75.
http://dx.doi.org/10.1016/S2212-5671(14)00177-4
Reverte, C., Gomez-Melero, E., & Cegarra-Navarro, J., G. (2016). The influence of corporate social responsibility practices on organizational performance: evidence from Eco-Responsible Spanish firms. Journal of Cleaner Production, 112, 2870-2884.
http://dx.doi.org/10.1016/j.jclepro.2015.09.128
Segal, T. (2019). Profitability Ratio Indicators.
https://www.investopedia.com/university/ratios/profitability-indicator/
Sila, I., & Cek, K. (2017). The Impact of Environmental, Social and Governance Dimensions of Corporate Social Responsibility on Economic Performance: Australian Evidence. Procedia Computer Science, 120, 797–804. http://dx.doi.org/10.1016/j.procs.2017.11.310
Vong, F., & Wong, I. A. (2013). Corporate and social performance links in the gaming industry. Journal of Business Research, 66, 1674–1681. http://dx.doi.org/10.1016/j.jbusres.2012.12.014
Wang, W-K., Lu, W-M., Kweh, Q., & Lai, H-W. (2014). Does corporate social responsibility influence the corporate performance of the U.S telecommunications industry? Telecommunications Policy, 38, 580–591. http://dx.doi.org/10.1016/j.telpol.2014.01.004
Wang, D., H-M., Chen, P-H., Yu, T., H-K., & Hsiao, C-Y. (2015). The effects of corporate social responsibility on brand equity and firm performance. Journal of Business Research, 68, 2232–2236. http://dx.doi.org/10.1016/j.jbusres.2015.06.003
Wang, H., Lu, W., Ye, M., Chau, K.W., & Zhang, X. (2016). The curvilinear relationship between corporate social performance and corporate financial performance: Evidence from the international construction industry. Journal of Cleaner Production, 137, 1313-1322. http://dx.doi.org/10.1016/j.jclepro.2016.07.184
Wang, Z., & Sarkis, J. (2017). Corporate social responsibility governance, outcomes, and financial performance. Journal of Cleaner Production, 162, 1607-1616.
http://dx.doi.org/10.1016/j.jclepro.2017.06.142
Weber, M. (2008). The business case for corporate social responsibility: A company-level measurement approach for CSR. European Management Journal, 26, 247–261.
http://dx.doi.org/10.1016/j.emj.2008.01.006
Xie, X., Jia, Y., Meng, X., & Li, C. (2017). Corporate social responsibility, customer satisfaction, and financial performance: The moderating effect of the institutional environment in two transition economies. Journal of Cleaner Production, 150, 26-39.
http://dx.doi.org/10.1016/j.jclepro.2017.02.192
Xiong, B., Lu, W., Skitmore, M., Chau, K. W., & Ye, M. (2016). Virtuous nexus between corporate social performance and financial performance: a study of construction enterprises in China. Journal of Cleaner Production, 129, 223-233. http://dx.doi.org/10.1016/j.jclepro.2016.04.078
Zhao, H., Teng, H., & Wu, Q. (2018). The effect of corporate culture on firm performance: Evidence from China. China Journal of Accounting Research, 11, 1–19.
https://doi.org/10.1016/j.cjar.2018.01.003
In-Text Citation: (Tabook, 2021)
To Cite this Article: Tabook, Y. S. (2021). The Impact of Corporate Social Responsibility on Corporate Financial Performance from Multiple Literature Perspectives. International Journal of Academic Research in Accounting Finance and Management Sciences, 11(3), 692–707.
Copyright: © 2021 The Author(s)
Published by Human Resource Management Academic Research Society (www.hrmars.com)
This article is published under the Creative Commons Attribution (CC BY 4.0) license. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this license may be seen at: http://creativecommons.org/licences/by/4.0/legalcode