ABSTRACTThe central purpose of this study was to explore the effects of corporate social responsibility (CSR) on corporate financial performance of selected commercial banks in Ghana. A sample of 6 commercial banks was purposively selected based mainly on availability, consistency, and accessibility of their annual audited financial reports for the …
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ABSTRACTThe central purpose of this study was to explore the effects of corporate social responsibility (CSR) on corporate financial performance of selected commercial banks in Ghana. A sample of 6 commercial banks was purposively selected based mainly on availability, consistency, and accessibility of their annual audited financial reports for the period under study. The study covered a six-year period from 2013 to 2018. Quantitative research design was adopted. Secondary data in the form of CSR expenditures were extracted from financial statements of the banks. Return on asset (ROA) was used as a proxy for financial performance. CSR was measured in terms of corporate employee responsibility (CER) and corporate community responsibility (CCR). Firm size and age were examined as control variables. Descriptive statistics and panel regression modeling of fixed effect (FE) techniques were employed in data analysis. The study reports that financial performance is negatively influenced by CER and CCR but the effect of CER was not significant while that of CCR was statistically significant at ten percent level. A statistically significant negative association was found between corporate community responsibility and performance. This presupposes that it is not always true that doing good translate into corporate benefits. Commercial banks are therefore advised to balance investments in social initiatives with investments in providing innovative customer solutions that can go a long way to building customer satisfaction and loyalty. In conclusion, commercial banks mustbalance investments in social initiatives with investments in providing innovative customer solutions that can go a long way to building customer satisfaction.
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