Empirical Analysis On Mandated Csr And Performance of Listed Firms In India (2015-2018)

International Journal of Economics and Management Studies

© 2020 by SSRG - IJEMS Journal

Volume 7 Issue 4

Year of Publication : 2020

Authors : Gaurav

10.14445/23939125/IJEMS-V7I4P116

How to Cite?

Gaurav, "Empirical Analysis On Mandated Csr And Performance of Listed Firms In India (2015-2018)," SSRG International Journal of Economics and Management Studies, vol. 7,  no. 4, pp. 116-125, 2020. Crossref, https://doi.org/10.14445/23939125/IJEMS-V7I4P116

Abstract:

The study carried out an empirical investigation on the effects of mandated CSR and firm performance of Indian firms, considering firms’ profits and turnover ratio to incorporate shareholders’ and managers’ views of performance. The study engaged panel regression to analyze the impact of mandated CSR spending on firms’ profits and turnover ratio metrics of financial performance. T-test was employed to ascertain whether there exists a significant difference in the performance of high CSR spending and low CSR spending Indian firms, in recent times. Fixed panel regression technique was employed to analyze the model of the study, which captured the effects of CSR spending, firm size, firm leverage, and board composition on firms’ profits and turnover ratio metrics of financial performance. The study engaged fifteen listed firms on the Bombay Stock Exchange, over the periods of 2015 and 2018. Results from the t-test conducted found that there is a significant difference in profits among high CSR spending firms and low CSR spending firms. Results from the panel regression analysis showed that CSR impacted positively on firms’ profits and turnover ratio. However, there was only a significant relationship between CSR and firms’ profits, which suggests that CSR spending serves as a mechanism for improving firms’ performance, if conducted purposefully. Hence, the study concluded that there is enough evidence that CSR significantly promotes the performance of Indian firms.

Keywords:

Mandated Csr, Firms, Empirical

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