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1. Name : Ahadul Haque
ID : 160352
Course : Bachelor Thesis 1
Code : BA - 4105
Impact of Corporate Social Responsibility (CSR)
On Corporate Financial Performance (CFP)
in the Listed Financial Institutions in
Dhaka Stock Exchange (DSE)

2. 2
Methodology
Conceptual Framework
Contents
Literature Review
Background Objective
Rationale
Introduction
CFP
CSR
Measurement
Relationship
Sampling Model
Analysis Hypotheses

3. 3
INTRODUCTION
Background of the Study
Frooman’s (1997) idea that CSR is "An activity by a corporation for the
wellbeing of an identifiable social stakeholder."
1930: Conceptualized as social responsibilities of the non-public sector
Howard R. Bowen (1953) defined duties as decisions made by the corporation
in conformity with societal values.
1970: 𝑝𝑢𝑏𝑙𝑖𝑐 𝑘𝑛𝑜𝑤𝑙𝑒𝑑𝑔𝑒 𝑜𝑓 𝐶𝑆𝑅 ∝ 𝑠𝑜𝑐𝑖𝑒𝑡𝑎𝑙 𝑒𝑥𝑝𝑒𝑐𝑡𝑎𝑡𝑖𝑜𝑛

4. 4
INTRODUCTION
Background of the Study
Margolis et al., (2009) found three distinct kinds of relationship between
CSR expenditure and Firm performance
2015: Ways of implementing CSR and their effect
Yeaseen and Nehal (2020) derived that,
CSR affects all of operations of business
2000: 𝒔𝒐𝒄𝒊𝒂𝒍 𝒓𝒆𝒔𝒑𝒐𝒏𝒔𝒊𝒃𝒊𝒍𝒊𝒕𝒚 𝒗𝒔 𝒍𝒐𝒏𝒈 𝒕𝒆𝒓𝒎 𝒔𝒖𝒄𝒄𝒆𝒔𝒔

5. 5
30%
20%
10%
40% Health
Education
Disaster Management
other
INTRODUCTION
Rationale
Mackey, A. et
al. (2007)
Bangladesh Bank
Responsible Organizations
Better Market Valuation
Improved Financial Success
Competitive Advantage
30%
20%
10%
40%

6. 6
INTRODUCTION
Objective
Primary Objective:
The main objective of this paper is to analyze the impact of
corporate social responsibility on corporate financial performance.
Secondary Objectives:
To analyze the influence of CSR on:
• P/E ratio.
• Return on Sales.
• Assets Turnover.
• Tobin’s Q.
• Return on Assets.
• Return on Equity.
• Earning per Share.
• Return on Investments.

7. 7
INTRODUCTION
Scope
Eco-friendliness
Personnel Engagement
Social Development and
Community Service
Product Ethics
Customer Attachment
CSR activities
of the Financial
institutions
listed in DSE
ROA ROE EPS Tobin’s Q
ROI P/E ratio ROS Asset Turnover

8. 8
INTRODUCTION
Limitations
• 5 financial years only
• Secondary data source
• Unavailability of data

9. 9
LITERATURE REVIEW
Corporate Social Responsibility
Bowen et al.,1953
Bronchain, 2002
Islam et al., 2012
Karim et al., 2018
Tahmina, 2018
Rather than running businesses from a holistic perspective,
business peoples’ responsibilities extend outside the scope
of their core activity.
CSR is still evolving and does not yet have a clear meaning
or a set of generally accepted standards
An obligation and set of guidelines to make decisions
based on the aims and ideals of our society.
CSR provides a comprehensive understanding of the
subject matter, establishes CSR's supplementary worth in
terms of economic and social advancement, and makes
recommendations for possible future actions.
By attaining business success in approaches that uphold
moral ideologies and respect individuals, communities,
and the environment, business for Social Responsibility has
defined corporate social responsibility.

10. 10
LITERATURE REVIEW
Corporate Financial Performance
It illustrates how effectively a company uses
its resources to maximize revenues and
wealth for its shareholders.
Demonstrates the extent to which
financial objectives have been met and is an
important aspect of financial risk
management
Naz & Ijaz, 2016
Verma, 2020

11. 11
Author Country Variables Findings
Alafi et al.,
(2012)
Jordan
CSR,
consumer
satisfaction,
financial
performance
strong positive correlation
between CSR and financial
performance
Šťastná et al.
(2012)
Czech
Republic
CSR, CFP
CSR has positive influence
on banks financial
performance
Sarwar et al.
(2012)
Banglades
h
CSR, ROA
Banks practicing CSR have
higher ROA
LITERATURE REVIEW
Literature at a glance

12. 12
Author Country Variables Findings
Bolanle et al.
(2102)
Nigeria
CSR
expenditure,
Profit after tax
Positive association between
a bank's CSR expenditures
and the profitability of the
bank
Samina (2012) Bangladesh
CSR spending,
IB’s deposit,
investments and
profitability
Strong positive correlation
between CSR and Islamic
Banks deposits, investments
and profitability.
Azad et al.
(2013)
Bangladesh CSR expenditure
Increasing contribution to the
society ethically leads to
growth of market share
LITERATURE REVIEW
Literature at a glance

13. 13
Author Country Variables Findings
Kanwal et al.
(2013)
India
CSR, EPS, ROA,
ROE
CSR has a positive linkage
with EPS, ROA, ROE, also
CSR spending has long term
development of the
organization
Rana (2015) Bangladesh
CSR, customer
behavior,
financial
performance
CSR is being paid
increasingly more attention
as a driving factor for
financial success and
reputation increase in
developing countries like
Bangladesh
Seetharam et al.
(2015)
South Africa
CSR, ROE,
ROA, ROS, EPS
Negative relationship
between corporate financial
performance and CSR
expenditure
LITERATURE REVIEW
Literature at a glance

14. 14
Author Country Variables Findings
Adeneye &
Ahmed (2015)
United
Kingdom
CSR, market to
book value, firm
size, return on
capital employed
Optimization of CSR have
beneficial impact on
financial performance as
well as shareholders’ wealth
Yusoff and
Adamu (2016)
Malaysia CSR, ROE, EPS
Strong relationship between
CSR and CFP
Laskar & Maji
(2016)
India
Corporate
sustainability
performance,
firm
performance,
CSR spending
CSR has positive impact on
the performance of the
organization
LITERATURE REVIEW
Literature at a glance

15. 15
Author Country Variables Findings
Rashid
(2018)
Bangladesh
Corporate
governance
index, board
independence,
CEO duality,
debt ratio,
liquidity, firm
age, firm size, firm growth
profitability, market capitalization
and firm risk
CSR information has
significant influence on
corporate financial
performance, while financial
performance has very little
impact on CSR performance
Javeed and
Lefen
(2019)
Pakistan
CSR, firm
performance,
CEO authority,
management
ownership and
ownership
concentration
with CSR
Relationship between CSR
and firm performance is not
altered by CEO authority,
management ownership and
ownership concentration
with CSR
LITERATURE REVIEW
Literature at a glance

16. 16
LITERATURE REVIEW
Measurement
CSR
Content Analysis based on the disclosed CSR activities.
CFP
Quantitative data found on:
• P/E ratio.
• Return on Sales.
• Assets Turnover.
• Tobin’s Q.
• Return on Assets.
• Return on Equity.
• Earning per Share.
• Return on Investments.

17. 17
CSR Disclosure Dimensions
CFP Indicators
Conceptual Framework
LITERATURE REVIEW
Eco-friendliness
Personnel engagement
Social development and
community service
Product ethics
Customer attachment
ROA
ROE
EPS
P/E ratio
Tobin’s Q
ROI
Asset turnover
ROS

18. 18
METHODOLOGY
Research Method

19. 19
The study is based on the activities of financial institution.
Thus, the best potential target for this research are the
financial institutions of the country.
This paper will target the Financial Institutions Listed in
DSE for the collection of the required data.
Population
METHODOLOGY

20. 20
The sample size for this study is set at 40 Financial
Institutions Listed in DSE that will be convenient to find.
Non-Probability Sampling
Purposeful Sampling
Sampling Methods and Sample
METHODOLOGY

21. 21
Secondary Data will be collected
from Annual Reports.
CSR activities will be analyzed via
Content Analysis.
Data Collection and Analysis
METHODOLOGY
Descriptive statistics and influence
analyses as correlation and regression
will be done between CSR and CFP.

22. 22
Formula for content analysis
LITERATURE REVIEW
𝐶𝑆𝑅𝐷𝑘𝑝 =
3 𝑄𝑁𝐷 + 2 𝑄𝐿𝑆𝐷 + 𝑄𝐿𝐺𝐷
𝑀𝑇𝑆
CSRDkp = CSR disclosure for kth company for pth dimension.
QND = Quantitative disclosures (quantity or amount).
QLSD = Qualitative specific disclosures.
QLGD = Qualitative general disclosures.
MTS = Maximum total Score for a particular company.

23. 23
ROA
ROE
EPS
T
ROI
P/E
AT
ROS
Models
LITERATURE REVIEW
= α0+ß1 CSRD_ECO + ß2 CSRD_SDCS +ß3 CSRD_PDE +
ß4 CSRD_CA + ß5 CSRD_PEN + µ

24. 24
Hypothesis
LITERATURE REVIEW
ROA
ROE
EPS
P/E ratio
Tobin’s Q
ROI
Asset turnover
ROS
H1
H2
H3
H4
H5
H6
H7
H8
CSR has no
significant impact
H0
CSR has significant
impact
H1

25. 25