CORPORATE SOCIAL RESPONSIBILITY AND FINANCIAL PERFORMANCE OF THE CONSUMER GOODS COMPANIES IN NIGERIA

Abstract

Corporate social responsibility is a new accounting concept that emphasises the need for corporate entities to give back to the environment and society which are affected by their operations. Embracing this practice has the potential to boost the performance of the firms as there would be a more conducive operational environment and a higher tendency to patronise the products and services. Against this backdrop, this study evaluates the effect of corporate social responsibility disclosure on the financial performance of consumer goods companies in Nigeria from 2013-2022. The sample size is 17 consumer goods companies. The data were extracted from the annual reports and accounts of the companies. The results from Model I showed that corporate social responsibility disclosures have a significant negative effect on earnings per share. The Model II revealed that corporate social responsibility disclosures have a significant positive effect on the return on assets, while Model III showed that corporate social responsibility disclosures have an insignificant positive effect on the return on equity of the studied companies. The study recommends moderate but impactful socially responsible activities to boost earnings per share and improve return on assets and equity as a way of displaying the desirable effect of firm performance.