Norhayah Zulkifli

Looking for evidence of the relationship between corporate social responsibility and corporate financial performance in an emerging market

Purpose – The purpose of this paper is to examine the relationship between corporate social responsibility (CSR) and corporate financial performance (CFP) of Malaysian public listed companies (PLCs) as an emerging market setting.Design/methodology/approach – A longitudinal data analysis with a large‐sample testing was carried out from 200 Malaysian PLCs by using panel data analysis during a seven‐years period. The statistical power with fixed effect and random effect model was utilized.Findings – Results of earlier estimations indicate that there are positive and significant related of the CSR on CFP. Two of the CSR dimensions, namely employee relations and community involvement, were found to be positively related to financial performance. This proves that CSR practices can be considered as effort to enhance the financial performance of PLCs in Malaysia. The results also reveal that there is limited evidence of the relationship between CSR and CFP in the longterm.Practical implications – These findings s...