Purpose Despite continuous research efforts, the literature is still inconclusive about the relationship between corporate social responsibility (CSR) and financial performance. With an aim to address this problem, this study aims to analyze the impact of CSR on financial performance in the Indian context. Design/methodology/approach Using a panel of top 137 companies from CNX-500 for 10 years (2008-2017), the impact of CSR on three indicators of financial performance, namely, Return on Assets (ROA), Return on Equity (ROE) and Net Profit Margin (NPM), is evaluated using the panel data regression analysis. The technique of content analysis is used to collect data on CSR from the annual reports of selected companies. Findings The study finds that the impact of CSR on financial performance may be neutral (with ROA and NPM) or negative (with ROE). The negative influence of CSR on ROE of firms supports the theory by Friedman (1970) that the only responsibility of business is to maximize profits and returns for its shareholders. Originality/value After amendments in Companies Act, 2013, there is limited literature addressing this scientific inquiry in the Indian context. The study period (2008-2017) includes CSR disclosures from both periods, before reforms and after reforms, which adds to the uniqueness of this research study. In addition, this study uses a research instrument consisting of a total of 178 CSR activities divided across 46 themes for collecting data from annual reports of the companies. The utilization of such a comprehensive research instrument, for the study, also adds to its peculiarity.
PurposeThe purpose of the present study is to analyze the impact of corporate social responsibility (CSR) disclosures on firms' profitability and its persistence.Design/methodology/approachThe study has been conducted for listed firms operating in India from 2008 to 2017. Content analysis has been utilized to estimate the CSR disclosures score. Further, dynamic panel regression has been utilized to estimate the relationship between CSR disclosures and profit persistence.FindingsThe results confirm positive profit persistence for Indian companies. The results further show that different dimensions of CSR disclosure have differential impact on firms' profitability. CSR dimensions concerning total community development and product-related disclosures have a positive relationship, whereas dimensions related to environmental and customer-related disclosures have a negative relationship with financial performance. The results also indicate that CSR disclosures are significantly related to profit persistence.Originality/valueThe study is first of its kind that analyzes the impact of CSR disclosure on profit persistence for Indian companies. The results can provide useful implications for managers and regulators in terms of formulation of overall CSR policies.
Purpose The purpose of this paper is to analyze the extent, quantity and quality of corporate social responsibility (CSR) disclosures made by the top Indian companies in their annual reports. Design/methodology/approach This study analyzes the annual reports of the top 137 companies from CNX-500, over ten years, from 2008 to 2017. The technique of content analysis has been employed manually to examine the number of CSR activities disclosed, quantity and quality of CSR disclosures made by the selected companies in their annual reports. Also mean, percentages, trend analysis and analysis of variance have been employed to analyze the disclosures. Findings This study highlights that there is a continuous increase in the quantity of disclosures and the number of CSR activities disclosed by Indian companies over the selected period. It also observed that among the selected themes, most disclosed CSR activities are from “customer theme” and “community development theme.” Findings regarding the quality of CSR disclosures revealed that the “qualitative disclosures with specific information” are preferred most by the companies within India. Also, there is a significant variation in the quantity of CSR disclosures across the selected eight themes. Originality/value As most of the prior literature on CSR disclosures focused on developed countries in comparison to developing ones, this study contributes to the existing literature by carrying out an extensive investigation of this concept among the Indian companies. Moreover, there are very few studies addressing such a scientific inquiry in the Indian context, especially after the introduction of amendments in the Companies Act, 2013. Furthermore, this study utilizes a comprehensive research instrument consisting of a total of 178 CSR activities, divided across eight themes for collecting data on disclosures from the annual reports. This instrument can be used in the future studies on CSR disclosures in other developing countries as well.
The purpose of this study is to explore the corporate social responsibility (CSR) initiatives undertaken by Dabur India Limited, the biggest Ayurvedic company in the world, at areas close to its manufacturing plant. It also explores the perception of Dabur’s stakeholders with respect to its social responsibility behaviour. For the purpose of this study, both primary as well as secondary data have been used. The primary data have been collected by conducting unstructured interviews and a field visit within the premises of the company’s manufacturing plant in Baddi district as well as in the surrounding villages. The secondary data have been collected from annual reports of the company and the company website. On investigating, it was be observed that Dabur, through years of social involvement and local community partnership projects, has established a special bond of trust with all its stakeholders. Also, as the expenditure made by Dabur on its CSR activities has always exceeded the stipulated amount as per government recommendations, this evidently supports its dedication towards its vision statement, on creating value for society. As after a revision in CSR policies there have not been many research studies examining the CSR practices by companies in India, this study, therefore, addresses this knowledge gap and provides new insights on the compliance by Dabur with regard to new CSR guidelines by the Companies Act, 2013.
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