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Corporate social responsibility and financial performance: Evidence from U.S tech firms

Okafor, Anthony and Adeleye, Bosede Ngozi and Adusei, Michael (2021) Corporate social responsibility and financial performance: Evidence from U.S tech firms. Journal of Cleaner Production.

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This study provides quantitative evidence on the positive effect of spending on socially responsible causes on the long-term growth of U.S technology companies. Maximizing shareholder wealth remains the overarching principle driving organizational strategies, but this has always conflicted with other stakeholders’ interests. Because of these conflicting priorities, entrenching the principles of social responsibility has become imperative. We leverage content analysis, fixed-effects and pooled regression models to examine the effect of engaging in CSR on tech companies’ corporate financial performance in the U.S. The empirical study consists of panel data of the top 100 tech companies listed on the S&P 500 for the period 2017 and 2019. We examine the link between corporate financial performance and CSR proxies. The main results indicate that tech companies that spend more on CSR experience a corresponding increase in revenue and profitability. Contrary to previous studies, we observe insignificant evidence to support a relationship between CSR and Tobin’s Q.

Item Type: Article
Uncontrolled Keywords: Corporate social responsibility Corporate financial performance Firm value Sustainable development Tech industry
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HB Economic Theory
Divisions: Faculty of Law, Arts and Social Sciences > School of Social Sciences
Depositing User: Mrs Hannah Akinwumi
Date Deposited: 27 May 2021 11:40
Last Modified: 27 May 2021 11:40

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