Purpose This study aims to investigate the effect of corporate social responsibility (CSR) disclosure on firm performance, considering both firm profitability and firm value in an emerging market, India. Design/methodology/approach The study examines the effect of CSR disclosure on firm performance using panel regressions for the final sample that consists of 386 companies listed in the BSE 500 index, India. It covers all major players in the capital market for ten years from 2007–2016. Findings The result shows a trend toward the negative effect of CSR disclosure on firm profitability and firm value in India; this negative effect is mainly influenced by environmental disclosure score and social disclosure score. An adverse effect of firm profitability and firm value on CSR disclosure is also observed to underline the inverse relationship. Practical implications The study provides implications to consumers, investors, managers and policymakers. Firstly, consumers have to be more aware of CSR initiatives of companies, and they should support those companies to do more. Secondly, investors can use the ESG disclosure score as a signal for the level of CSR activities, which negatively affects firm performance. Thirdly, managers have to consider CSR more seriously and spend CSR amount wisely after proper research and not just to meet the mandatory limit. In addition, managers have to take necessary actions to make the public aware of the CSR activities of the company to gain an advantage in the future. Finally, policymakers have to give more emphasis on the promotion of CSR activities to reach the ultimate consumers who lie in the remote areas of the country, and more awareness has to be given to them regarding CSR activities. Originality/value The findings contribute to the literature by providing insights on CSR disclosure and firm performance relationship in India, an emerging market with increasing international attention where such studies are scant and less clear, especially after the amendments in the Companies Act, 2013. Furthermore, the measurement of CSR disclosure using environmental, social and governance (ESG) score is novel in the Indian context.

Innovation investment decisions are always riskier business decisions, especially when it is a question of spending on research and development, but it is a vital area of decision-making which enhances growth and sustainability. First, we attempted to investigate the bidirectional causality between R&D and profitability measured in terms of NP (net profit), ROA and ROE through Granger causality test from a sample of 255 sample Indian listed firms for a period of eight years ranging from 2008 to 2015, while finding unidirectional causality only between R&D expenditure and profitability, we moved for analysing the magnitude of relationship through multiple regression model which revealed that R&D expenditure negatively affects the profitability but affects the profitability of subsequent years positively while taking lags. Further, moderating regressions equation was employed to assess the moderating role of corporate governance variables such as board size, board independence, family ownership, foreign and institutional ownership with controlling effects of size, market capital and liquidity position. The results revealed that all moderating variables except board size affect the slope of regression positively, but technically only family ownership moderates the relationship between R&D expenditure and profitability as there is significant change in f-value while moderation effect of family ownership is taken into consideration. Only board size affects negatively the relationship questioning the role of internal board and their interest in innovation for maximising personal benefits

The central focus of the study is to assess corporate governance effectiveness in mitigating risk and controlling risk behavior of management of Indian firms. From sample of 270 NSE listed Indian firms for period of 9 years ranging from 2007–2008 to 2015–2016 using partial least square structural equation modeling (PLS-SEM) method an alternative to covariance-based SEM was applied to test hypothesis. While testing hypothesized negative relationship between good governance and risk-taking as documented in prior research, our results have shown contradictory results only in case of effectiveness of committee level governance especially compensation and risk committee effectiveness has failed to significantly claim causality on compensation risk and other risk measured through financial and investment risk. Similarly, board structure and activities have failed to reduce compensation sensitivity to performance, while as, characteristics like board diversity, expertise, average tenure, and CEO vested power boards have positive inclination to debt financing and spending on research and development. However, using Cohens D, called effect size, all corporate governance constructs have no or very minimal contribution in explaining changes in risk variability, thus creating ample scope for improvements in Indian corporate governance system.

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