Date of Conferral

2015

Degree

Ph.D.

School

Management

Advisor

Mohammad Sharifzadeh

Abstract

Numerous prior studies examining the relationship between Corporate Social Responsibility (CSR) and corporate financial performance have produced mixed results. Consumers expect alignment between corporation's CSR and business activities, yet a paucity of research examines the nature of CSR activities as related to corporate financial performance. Corporate leaders lack direction as to what CSR activities are most impactful. CSR is grounded in stakeholder theory, ethical work climate, and servant leadership theories. The relationship between self-interest in CSR activities, an index of alignment between business activities and CSR activities, and financial performance as measured by return on assets (ROA), return on equity (ROE), and change in market value added (MVA) as a percentage of assets has been underresearched. This study examined the financial performance of 77 companies from the 2014 Fortune 500. Information for the construct of self-interest in CSR activities was obtained from the websites of the sample companies. Correlational analysis was used to examine the relationship between self-interest in CSR activities and financial performance metrics. Multiple regression was used to control for firm size, industry, and CSR perception. Self-interest in CSR activities was found to be a significant predictor of both ROA and ROE, and was not found to be a significant predictor of change in MVA as a percentage of assets. This study contributes to positive social change by helping to illustrate a business case for CSR, providing leaders with incentive to invest in socially responsible activities in line with their business activities. Increased CSR activity directly benefits the most marginalized in a society, including those populations who lack voice.

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