Mandatory corporate social responsibility in India and its effect on corporate financial performance: Perspectives from institutional theory and resource‐based view

Nair, Asha K.S.; Bhattacharyya, Som Sekhar

doi:10.1002/bsd2.46

Cited by 85 publications

(71 citation statements)

References 88 publications

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“…Post the CSR mandate in India, the previous studies indicated diverse results, viz. positive (Bhagawan & Mukhopadhyayy, 2018;Gaurav, 2020), negative (Kuntluru, 2019;Bhattacharyya & Rahman, 2020) and insignificant (Dharmapala & Khanna, 2016;Nair & Bhattacharyya;Sydlowski, 2018) while examining the impact of CSR initiatives on financial performance. However, the available studies (Dharmapala & Khanna, 2016;Nair & Bhattacharyya;Sydlowski, 2018) that used CSR expenditure as a construct of CSR to examine the relationship of CSR with financial performance revealed an insignificant impact of CSR spending on financial performance.…”

Section: Resultsmentioning

confidence: 99%

“…Further, in the Indian context, the available literature (Bihari & Pradhan, 2011;Dhaliwal et al, 2011;Kapoor & Sandhu, 2010;Mishra & Suar, 2010) generally reported a positive effect of CSR on firm performance before the mandatory CSR regime in India. Post the CSR regulations in India, the available studies reported positive (Bhagawan & Mukhopadhyay, 2018), negative (Kuntluru, 2019) and insignificant (Dharmapala & Khanna, 2016;Nair & Bhattacharyya, 2019;Sydlowski, 2018) effect of CSR initiatives on financial performance.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Several studies from the available literature have examined the relevance of corporate social responsibility (hereafter, CSR) by studying the effect of CSR initiatives of a firm on its financial performance (Luo & Bhattacharya, 2009;Nair & Bhattacharyya;Rodriguez-Fernandez, 2016). The available studies found diverse results including positive (Harjoto & Laksmana, 2018;Luo & Bhattacharya, 2009;Rodriguez-Fernandez, 2016), negative (Aras et al, 2010;Crisóstomo et al, 2011;Kuntluru, 2019) and insignificant (McWilliams & Siegel, 2000;Soana, 2011;Sydlowski, 2018) relationships between CSR and financial performance.…”

Section: Introductionmentioning

confidence: 99%

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Is CSR Expenditure Relevant to the Firms in India?

Garg

Gupta

Bhullar

2021

OMEE

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The present study examines the relevance of Corporate Social Responsibility (CSR) expenditure to the firms in the mandatory regime in India. The paper has its theoretical basis from the instrumental aspect of the Stakeholder theory, which assumes a positive influence of CSR over financial performance. Therefore, the study hypothesizes that the firms which fulfill the CSR expenditure requirement will exhibit higher stock returns and lower systematic risk. Since India mandated CSR in the year 2014, the data of four years (2016-2019) for the sample of 426 National Stock Exchange (NSE) listed Indian firms are taken to employ the OLS regression method. The CSR expenditure in the mandatory regime was not found to be relevant to the firms because of an insignificant positive impact of mandatory CSR expenditure on stock returns. Thus, the instrumental aspect is not supported by the findings. However, the findings indicate a decrease in the systematic risk of the firms. Only a few studies in India investigated this phenomenon in the mandatory regime. Further, the contributions of the study to the CSR literature are fairly useful from the perspective of firms, investors, policy-makers, regulators, scholars, and countries that are planning for legislating CSR.

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Section: Resultsmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Is CSR Expenditure Relevant to the Firms in India?

Garg

Gupta

Bhullar

2021

OMEE

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“…Therefore, these theoretical lenses are helpful to simultaneously assess the internal and external factors influencing the environmental impact of SMEs. Moreover, like all other economic sectors, the SME sector is also becoming highly competitive due to stiff competitive environment that pertain in almost every sector of the business [54].…”

Section: Theory Descriptionmentioning

confidence: 99%

What Prompts Small and Medium Enterprises to Implement CSR? A Qualitative Insight from an Emerging Economy

et al. 2021

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The topic of corporate social responsibility (henceforth referred to as CSR) has been a central topic during the last decade, but the majority of the existing literature discusses CSR relationship with large organizations. Whereas, its contribution in small and medium enterprises (henceforth referred to as SME) sector has received little attention. There have been some studies that focused on CSR activities in SME sector quantitatively in the context of developing economies like Pakistan, but the fact is, to date, SME sector of Pakistan is not participating actively in CSR-related activities due to some constraints. The present study is a pioneer attempt, to explore CSR barriers that restrict SME sector of Pakistan from practicing CSR initiatives. For this reason, the present study explores these barriers qualitatively in order to gain in-depth knowledge of different CSR barriers. In doing so, we conducted semi-structured in-depth interviews from 9 SMEs in Lahore city of Pakistan. We performed thematic analysis, which produced five relevant themes of CSR barriers, including: Lack of resources, lack of regulations, lack of top management commitment, lack of CSR knowledge, and passive customer behavior. Our analysis further showed that lack of resources is the most related barrier that hinder SMEs to be engaged in CSR activities. This paper contributes to CSR literature in emerging economies’ context. Through an increased awareness of barriers, policy makers and practitioners may take necessary steps to improve CSR practices in SMEs.

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“…On the other hand, KPMG in its 2018 CSR Reporting Survey reports that compliance is now "near universal" [140] (p. 1), and generally positive outcomes with regard to CSR compliance have been found [141,142].…”

Section: Hypothesis 1 (H1)mentioning

confidence: 99%

Corporate Environmental Disclosure in India: An Analysis of Multinational and Domestic Agrochemical Corporations

et al. 2019

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The existing corporate environmental disclosure (CED) research focuses primarily on large companies operating in a single jurisdiction, leaving a gap of knowledge regarding the subsidiary operations of multinational corporations. In this study, consolidated narrative interrogation (CONI) is used to quantify CEDs presented in annual and stand-alone sustainability reports published over a 15-year span between 2002 and 2016 by agrochemical companies operating in India. Results show that the diversity, the quantity, and the quality of CED vary significantly, but generally each of them has been improving over time—most notably following the revisions to the Companies Act in 2013. The study finds that the subsidiaries of multinational agrochemical corporations implemented CED practices more strongly associated with those of domestic companies than those found in the reports produced by their parent companies. The CED of both subsidiary and domestic companies appears to reflect concerns of local legitimacy.

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Mandatory corporate social responsibility in India and its effect on corporate financial performance: Perspectives from institutional theory and resource‐based view

Cited by 85 publications

References 88 publications

Is CSR Expenditure Relevant to the Firms in India?

Is CSR Expenditure Relevant to the Firms in India?

What Prompts Small and Medium Enterprises to Implement CSR? A Qualitative Insight from an Emerging Economy

Corporate Environmental Disclosure in India: An Analysis of Multinational and Domestic Agrochemical Corporations

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