Corporate social responsibility and its relationship with financial performance

by Whalen, Robyn M., Ph.D., CAPELLA UNIVERSITY, 2013, 132 pages; 3600776


The purpose of this study was to conduct research on whether corporate social responsible activities (CSR) have a significant relationship with organizational financial performance in terms of return on assets (ROA), return on equity (ROE), and earnings per share (EPS), with a special focus on healthcare organizations. The research design for this study was a quantitative, nonexperimental, and exploratory correlational one, used to determine whether, and to what extent, a significant relationship exists between the independent variable of CSR and the dependent variables of financial performance. The problem is that leaders of organizations, stakeholders, or investors view CSR as an expensive obligation that does not necessarily contribute to the financial performance of the organization or might compromise a return on investment. This issue involves determining the significance or lack of significance of a relationship of CSR and organizational financial performance and if a variance exists between the healthcare industry and other industries. Overall, the results demonstrated a positive relationship with organizational CSR activities and their corresponding financial performance as confirmed by data from 33 companies. CSR was found to be positive and significant related to the first hypothesis of ROA but not the second and third hypotheses of ROE or EPS. The implications of these findings can add to the practice of incorporating CSR into corporate strategy to improve financial performance and shareholder value as well as to contribute to gains for societies and communities. The opportunity exists to contribute to the current knowledge base with additional research, specifically in the healthcare industry. The findings will not only add credibility to the existing literature but also provide evidence based management research in the current economic environment.

AdvisersMartin Lees; Richard Costello
Source TypeDissertation
SubjectsManagement; Finance; Health care management
Publication Number3600776

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