Corporate Social Responsibility Reporting in India: Exploring Linkages with Firm Performance

摘要

The study examines the corporate social responsibility (CSR) strategies and activities of firms as disclosed in annual reports, and explores its linkages to accounting and market performance of firms. The study examines the annual reports of a sample of 30 firms (out of 50) belonging to the benchmark index of the National Stock Exchange of India and tracks these reports for evidence of CSR activities over a 5-year period from 2007 to 2011. The study employs content analysis to study CSR disclosure and classifies and rates these activities using items from an established scale followed by construction of category-wise CSR indexes. The association of these indexes with firm performance is explored through a pooled regression model after provisioning for control variables and lag effects. The study finds that CSR reporting may not have any significant impact on accounting and market performance of the firm in the short term but environment-oriented CSR disclosure may be negatively related to the market performance of the firm. The study also finds that firms focus heavily on employee-and customer-oriented CSR and the modes of CSR investments are more contributory rather than participative in nature.