Abstract
The traditional goal of a company is to earn profit to pay its shareholders, but, nowadays, for the business to be sustainable in the long term, a strategy of Corporate Social Responsibility (CSR) activities is needed to meet stakeholder demands, respect ethical principles and give an appropriate answer to organizational stakeholders. The objective of the paper is to identify how strong the correlation between CSR and profit is, and how companies behave in the periods they have losses, whether they continue to do CSR activities, they reduce the activities, or they give them up. Thus, CSR is attributed to the concept of “doing good” and profit to the expression of “doing well”, from which a “positive business” can be built. Our empirical research consists of a panel data econometric model using logistics regressions to highlight the correlation between profit and the decision to do CSR activities and feasible generalized least squares (FGLS) regressions to identify the correlations between the level of CSR activities and the dimension of profit, an expression of financial performance. The main results emphasize that the companies which implement CSR activities in a greater extent are more profitable in economic terms.
Highlights
Sustainable companies anticipate the future needs of society [1] and adjust their business priorities to new needs, making sure they have the resources to continue doing business [2,3,4]
The impact of corporate social responsibility (CSR) on profits is stronger in competitive industries, especially when several other businesses take action, CSR can be used as a means of differentiation in other competitive environments
MFeraosmureasll of the CSR indicators identified in the literature review, we found in the reports of listed companies, information on four activities (Figure 2), namely corporate giving, health and safetTyhceoisntsdiactattohres wthoartkepxlparceess[1p1r,o5fi8,t7a5b]i,lietymaprleobyaeseetdraoinniancgcocuonutrisnegs deaxtpaeannsdesin[2fo7r,5m8a,7ti5o]napnrdovwidaestde bmyatnhaegfiemnaennctieaxl pmeanrskeest[5(F6i,6g7u,r6e8]2,)b. uFtowr iethacohutocfotmhepmle,tefiinnafnocrmialatdioatnaornegtharedaimngouthnetsvsapluenets. oTfhperoonfilty, tcuartnegoovreyr, otoftaelxipmenpsaeisrmfoerntw, thoitcahl awsseetfso,utnotdalthlieabailmitoieusn, tnsusmpbeenrt owf asshacroerspaonradtethgeiivr imnga,rkwethipcrhicwe aats 3m1eDaescuermedbears wpeerrceemntaonfutaullryncoovlelerc[t5e9d,7fr6o,7m7]t.he Bucharest Stock Exchange and each company’s website
Summary
Sustainable companies anticipate the future needs of society [1] and adjust their business priorities to new needs, making sure they have the resources to continue doing business [2,3,4]. In the context of corporate social responsibility (CSR) awareness of companies and the growth of activities, questions arise about whether there is an intention for CSR activities, what is the source of financing for these activities and how they influence the performance and value of companies [5]. Investors are becoming more interested in the social and environmental impact of companies and they want to invest in companies with a good CSR performance [6,7,8,9]. CSR activities are diverse and include: community investments, philanthropy, marketing campaigns with CSR elements, workplace health and safety activities, employee training courses, company policies for the protection of human rights and the fight against corruption, transparency in Sustainability 2018, 10, 1041; doi:10.3390/su10041041 www.mdpi.com/journal/sustainability. TThhuuss,, nnoonn--fifinnaanncciiaall rreeppoorrttiinngg ppllaayyssaanninicnrceraesaisnignlgylyimimpoprotarntatnrtolreolaendanadimasimtosintocrienacsreeatrsaenstrpaanrsepnacryenancyd apnedrfopremrfaonrmcean[1c6e,1[71]6,,1a7s], waselwl ealsl atso teonecnocuoruagraegecocmompapnainesiestotoaaddooppt taa mmoorree ssuussttaaiinnaabbllee bbuussiinneessss ssttrraatteeggyy [[1188]]
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