File(s) not publicly available

Mandatory CSR expenditure and firm performance

journal contribution
posted on 15.06.2020, 00:00 authored by Asit BhattacharyyaAsit Bhattacharyya, ML Rahman
India has recently mandated corporate social responsibility (CSR) expenditure under section 135 of the Indian Companies Act 2013 – the first national jurisdiction to do so. In line with the “shareholder value maximization” concept, we document the positive impacts of CSR expenditure on firm performance measured by return on asset and cash flow from operations. Additionally, we find that, despite the regulatory requirement, mandated CSR legislation is a significant but not the sole determinant of actual CSR spending by firms; rather, firm-specific economic factors such as size, level of cash balance and cash flow from operations have a moderating effect. We also observe that CSR expenditure contributes to firm performance irrespective of the level of actual CSR expenditure relative to the level of mandatory CSR expenditure. Our findings potentially reconcile conflicting results presented in the literature and …

Funding

Other

History

Volume

15

Issue

3

Start Page

1

End Page

17

Number of Pages

17

eISSN

2352-3298

ISSN

1815-5669

Publisher

Elsevier

Peer Reviewed

Yes

Open Access

No

Acceptance Date

19/09/2019

External Author Affiliations

The University of Newcastle

Era Eligible

Yes

Journal

Journal of Contemporary Accounting and Economics