Mandatory CSR expenditure and firm performance
| Autor: | Pradeep Kumar Gupta, Arunesh Garg |
|---|---|
| Rok vydání: | 2020 |
| Předmět: |
Marketing
Cultural Studies Government 050208 finance business.industry Strategy and Management 05 social sciences Economics Econometrics and Finance (miscellaneous) Geography Planning and Development Enterprise value Public sector Accounting Private sector Test (assessment) 0502 economics and business Corporate social responsibility Business and International Management business Stakeholder theory 050203 business & management |
| Zdroj: | South Asian Journal of Business Studies. 9:235-249 |
| ISSN: | 2398-628X |
| DOI: | 10.1108/sajbs-06-2019-0114 |
| Popis: | PurposeThis study, based on the instrumental approach of the stakeholder theory, examines the firm performance of public and private sector firms in the mandatory corporate social responsibility (CSR) expenditure regime in India. CSR was legislated in India in the year 2014.Design/methodology/approachThe study hypothesizes that firms which fulfill the mandatory CSR expenditure requirement will have a higher firm performance and uses one-way ANOVA and post-hoc test for analysis. Firm performance is examined with respect to firm value and market performance.FindingsThe instrumental approach of the stakeholder theory is not supported in the mandatory CSR expenditure regime in India. The public sector firms that comply with the mandatory CSR expenditure requirement have a lower firm performance. Further, the private sector firms that meet the mandatory CSR expenditure criterion do not have a significantly different firm performance than the private sector firms that do not fulfill this criterion.Practical implicationsThe study indicates as to why some firms fail to meet the CSR expenditure compliance. It also gives suggestions on how regulators and government agencies can solicit the participation of the Indian firms to undertake CSR initiatives. The study further suggests how firms may reap maximum benefit from the CSR expenditure.Originality/valueSince CSR expenditure has been made mandatory only in the year 2014 in India, hardly any study has examined firm performance in the mandatory CSR expenditure regime in India. |
| Databáze: | OpenAIRE |
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