Relating corporate social investment with financial performance
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DOIhttp://dx.doi.org/10.21511/imfi.14(2-2).2017.08
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Article InfoVolume 14 2017, Issue #2 (cont. 2), pp. 367-375
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Previous researchers have found conflicting results between CSI and firm financial performance. This paper moves this debate further by examining the extent to which corporate social investment (CSI) relates with corporate financial performance (CFP) from a developing country perspective. The main aim of the paper was to determine the relationship between CSI, stock price, sales turnover and return on equity (ROE) amongst the socially responsible investing (SRI) companies in the Johannesburg Stock Exchange. CSI data on the SRI companies were collected from companies’ integrated reports from 2011 to 2015. Therefore, a cross-sectional panel data arrangement was applied and the analysis was conducted using the ordinary least square (OLS). Tested at an alpha level of 0.05, the regression result produced a probability level of P < 0.01 for share price and sales turnover; and P = 10 for return on equity. Therefore, the findings revealed a strong positive and significant linkage between the SRI companies’ social investment, share price and sales turnover and no significant linkage with return on equity. These findings are consistent with previous literature findings reviewed in the paper on similar research conducted in developed countries, which showed positive and negative relationships. Findings from the literature indicate that various factors may account for conflicting results, which includes inter alia, time coverage, size of data, location, market sustainability awareness and culture. The paper contributes by revealing that whilst CSI may trigger improvement in stock price and sales turnover of SRI companies, the sales turnover might not necessarily result in boost in profit level that could engender enough return on equity within a short period time. The conflicting results from the literature is indicative of the inclusiveness in research between CSI and firm performance. Hence, the paper recommends further research to examine the relationship within a longer period of time using new sample of companies and other methods of analysis.
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JEL Classification (Paper profile tab)M11, M41
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References42
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Tables4
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Figures0
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- Table 1. Link between corporate social investment (CSI) and share price (ShP) of those companies
- Table 2. Association between corporate social investment (CSI) and turnover
- Table 3. Relationship exists between corporate social investment (CSI) and return on equity
- Table 4. Interpretation of results
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Industrial development in Saudi Arabia: disparity in growth and development
Anis Ali
doi: http://dx.doi.org/10.21511/ppm.18(2).2020.03
Problems and Perspectives in Management Volume 18, 2020 Issue #2 pp. 23-35 Views: 3006 Downloads: 1022 TO CITE АНОТАЦІЯIndustrial development in any nation plays a vital role in the strengthening of the economy and employs human resources as per specifications and directly towards the mainstream of the nation. In Saudi Arabia, there was rapid industrialization for four decades. Some manufacturing industries performed well, while some internal and external business environment factors influenced the others’ performance. The study focuses on historical development, as well as recent trends of well-performing and poor-performing industries of Saudi Arabia. Small manufacturing industries in Saudi Arabia are underdeveloped and need more attention to attain sustainable and progressive growth rate in the form of the number of establishments to enjoy the potential. Manufacture of tobacco, computer, electronics and optics, pharmaceuticals and transport equipment are the deprived and underdeveloped industries of the manufacturing sector. There should be some easy credit schemes for the development of deprived or underdeveloped manufacturing industries. To attain sustainable growth and development of the manufacturing sector, a positive attitude of the government towards underdeveloped manufacturing industries, favorable labor laws, and entrepreneurial awareness, technical and financial assistance are necessary. The growth and development of the manufacturing sector of Saudi Arabia will be helpful in the attainment of goals of Vision 2030.
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Why banks should consider ESG risk factors in bank lending?
Sarwar Uddin Ahmed ,
Samiul Parvez Ahmed ,
Ikramul Hasan
doi: http://dx.doi.org/10.21511/bbs.13(3).2018.07
Banks and Bank Systems Volume 13, 2018 Issue #3 pp. 71-80 Views: 2817 Downloads: 1132 TO CITE АНОТАЦІЯWhy banks should be concerned about incorporating environmental, social and governance (ESG) criteria in the lending process? What is the motivation? This study aims to find the motives for considering environmental, social and governance (ESG) criteria in bank lending process. A primary survey has been conducted to know the current status and motivation for incorporating ESG factors in investment decisions. Sample comprised 30 private commercial banks (PCBs) operating in Bangladesh. Data collected were analyzed with graphs, descriptive statistics, and regression analysis. Findings of the study indicate that banks are mostly considering basic environmental, social and governance factors set by regulators qualitatively. They are lagging behind in considering the advanced ESG criteria needed for sustainable and efficient credit risk management. Based on motivation for incorporating ESG factors, it was found that banks pioneering in incorporating ESG factors in lending decisions are compensated through better financial performance. Findings of the study are expected to encourage practitioners and policy-makers to take more pragmatic steps to incorporate ESG risk factors quantitatively in lending decision-making process.
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Integrated reporting and financial performance of South African listed banks
Reon Matemane ,
Rozane Wentzel
doi: http://dx.doi.org/10.21511/bbs.14(2).2019.11
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