Corporate Social Responsibility and Financial Performance of Product and Service-Based Firms Listed on London Stock Exchange

Ibrahim Elmghaamez, Jesuleke Olarewaju

Research output: Contribution to journalArticlepeer-review

4 Citations (Scopus)

Abstract

This paper examines the impact of corporate social responsibility (CSR) on the financial performance of firms listed on the London stock exchange (LSE). Using data for 50 firms spanning 2008-2017, our study reports that the environmental performance has positively influenced the stock price of both the product and service-based firms listed on LSE. Similarly, it enhanced the return on capital for product-based firms while reducing them for service-based firms. In contrast, social activities have a significant negative impact on the stock price of the product and service-based listed firms. Likewise, social performance has a significant negative impact on the return on capital of service-based firms listed on LSE. However, we find an insignificant relationship between governance disclosure and the stock price and the return on capital for product and service-based firms. This study has implications for policymakers of stock markets to issue rigid regulations to enforce all listed firms to disclose their environmental activities to stakeholders.
Original languageEnglish
Pages (from-to)1370-1383
Number of pages14
JournalCorporate Social Responsibility and Environmental Management
Volume29
Issue number5
Early online date1 Apr 2022
DOIs
Publication statusPublished - Sept 2022

Keywords

  • Stock price
  • return on capital
  • corporate social responsibility
  • environmental disclosure
  • social disclosure
  • governance disclosure

Fingerprint

Dive into the research topics of 'Corporate Social Responsibility and Financial Performance of Product and Service-Based Firms Listed on London Stock Exchange'. Together they form a unique fingerprint.

Cite this