Corporate Social Responsibility and its Nexus with Firm Performance and Institutional Ownership: An Emerging Market Context

Amna Noor, Muhammad Farooq, Mahwish Yamin and Saleh Nawaz Khan

Journal of Business and Social Review in Emerging Economies, 2020, vol. 6, issue 2, 845-858

Abstract: Either&corporate&social&responsibility&(CSR)&is¶mount&for&the&firms&or¬,&is&a&matter&of&question&since&long.&The&present&study&analyzes&this&relationship&in&the&context&of&moderating&role&of&Institutional&ownership&(IO).&Firm&performance&is&measured&through&accounting&and&market&value&measures.&Leverage,&firm&age,&firm&size,&and&log&of&sales&revenue&used&as&a&control&variables.&Through&applying&panel&data&techniques,&findings&demonstrate&insignificant&positive&association&between&CSR&and&firm&performance.&It&shows&that&stakeholder&could¬&assign&value&to&firms&spending&as&a&CSR.&This&could&be&the&reason&that&customers&are¬&much&aware&about&firms&CSR&activities&hence,&firms&fail&to&capitalize&their&spending&as&an&investment.&Institutional&Ownership&(IO)&reveals&negative&insignificant&association&with&all&profitability&measures&except&Tobin’s&Q&where&this&relationship&is&significant.&This&significant&negative&relationship&supports&the&agency&theory&and&presence&of&strategic&alliance&hypotheses&between&influential&institutional&owners&and&internal&management&that&leads&to&lower&firm&performance.&The&interaction&variable&of&CSR&and&IO&show&positive&but&insignificant&relationship&with&firm&performance&by&all&means.&

Keywords: Corporate social responsibility; firm performance; Pakistan stock exchange; Institutional ownership (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:src:jbsree:v:6:y:2020:i:2:p:845-858

DOI: 10.26710/jbsee.v6i2.1263

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