Corporate social responsibility and financial performance: A study of the tourism industry in Sri Lanka

Abstract

Sri Lanka is under a myth that the fall of tourism is due to the Easter Sunday attack in 2019 followed by the COVID-19 pandemic in 2020. In contrast, this study argues the fall started even before those shocks incorporating corporate social responsibility (CSR) and financial performance (FP) in the tourism industry. A stratified random sample of 10 hotels was selected, and their annual reports were utilized in gathering data. An abductive approach was employed where content analysis was carried out to find out the CSR words, then thematic analysis was conducted to grasp the important themes of CSR, and then the Nila unit method was adopted in converting the themes to measurable CSR. After converting CSR measurable, the study continued with descriptive and correlation analysis. The study found a slight but incremental behaviour in CSR disclosure yet a significant slump in FP of hotels. The study is significant since it argues that the present economic crisis is not due to the Easter Sunday attack and COVID-19 pandemic, but it emerged even before the said shocks.