Effect of Corporate Social Responsibility on Market-Based Financial Performance Measures of Listed Consumer Goods Companies in Nigeria

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Authors: GRACE, Yunusa Ph.D

Abstract

Corporate social responsibility is a self-obligation that organization needs to follow in order to have a conducive and friendly business environment. This study examined the effect of corporate social responsibility on market-based financial performance measures of listed consumer goods companies in Nigeria. The population of the study comprised all twenty (20) listed consumer goods companies in Nigeria, where sixteen (16) companies constituted the sampled population. The study used secondary data sourced from the annual reports and accounts of the sampled companies for the period 2010-2019. Corporate social responsibility is the independent variable measured using content analysis. The dependent variable is financial performance measured using Market-Based Financial Performance Measures (Price Earnings Ratio, Market to Book Ratio, & Dividend Yield). Descriptive Statistics, Correlation Analysis, and Multivariate Multiple Regression were utilized to analyze the study data. The study result revealed that CSR has a significant negative relationship with the MBFPM of listed consumer goods companies in Nigeria. It is therefore recommended that Companies should be checking the value of their stock constantly because investors use it to show the market perception of a particular stock value. So, if a company spends more on CSR, it will affect the value of its stock as well as the premium that the market gives to the firm on its net assets.

Keywords: Corporate Social Responsibility, Price Earnings Ratio, Market to Book Ratio, Dividend Yield.

2024 - NIJAF - 16 - 206 GRACE Y. 136-151.pdf

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