The relationship between CSR and financial performance: a literature review

Abstract

Corporate social responsibility (CSR) concept has been widely understood. Organizations should not only pledge on their economic consequences but environmental and social implications as well. CSR value has been attained interest among practitioners, most of them are eager to ascertain if the social responsibility can elevate its financial performance. Anyhow, heterogeneous results and contrary between analysis data has been observed. This paper’s objective is to identify the relationship between CSR and financial performance. It contains the integration of literature review between years 2011 to 2015 from the academics and researchers relating to the CSR and financial performance. Despite from the main variables, other factors such as the mediating variables, the approach applied, the methodology techniques and the industries involved are being discussed. This paper draws a link between CSR and corporate financial performance more deeply through the literature reviews analysis. The segregation of the literature review is presumed to have the comprehensiveness added for the future studies. The findings appeared to be consistence where CSR has a positive relationship to the financial performance. It validated the worth for an organization’s efforts to apply CSR. Additionally, this study provides greater insights for future researchers to scrutinize in more specific area that will help to groom CSR in the industry.