Corporate Social Responsibility And Financial Performance-Evidences From.Firms Domiciled In Ghana

As the concept and conduct of corporate social responsibility(CSR)remain at its developing stage in Ghana,conscious efforts are being made to increase CSR literature as well as encourage its widespread adoption among firms in the country.This study is conducted to explore the relationship existing between CSR and corporate financial performance(CFP)as well as to investigate if ownership structure moderates the relationship between CSR and CFP.The study sampled 112 firms from the Ghana Club 100 league table that are also domiciled in Ghana over a10-year period from 2012 to 2022.Secondary data were sourced from the annual reports and the financial statements of the sampled firms where the data obtained were analyzed by means of the ordinary least square estimation technique.The findings of the study revealed that CSR had a significant and positive relationship on the three measures of CFP assessed in this study including return on assets,return on sales,and the Tobin Q.Furthermore,it was uncovered that the ownership structure of firms moderated the relationship between CSR and CFP where foreign-majority owned firms were able to use CSR to boost their financial performance than local-majority owned firms.It is recommended that to promote a uniform and widespread adoption of CSR among firms in Ghana,there is a need to develop a robust and consolidated CSR policy as well as formulate laws to keep business organizations aligned to fulfil their corporate responsibility.It is also recommended that education on CSR ought to be intensified across industries with a focus on making firms understand the economic benefits associated with CSR other than the wrongful perception that corporate responsibility leads to sunk cost.