CORPORATE SOCIAL RESPONSIBILITY AND FINANCIAL PERFORMANCE OF LISTED CONSUMER GOODS MANUFACTURING FIRMS IN NIGERIA

Abstract

More often than not, consumer goods firms, like every other business organization are faced with the issue of corporate social responsibility (CSR) disclosures. In Nigeria, only a few companies are having their own social responsibility policy and most of these firms are multinational. To that end, this study investigated the relationship the relationship between corporate social responsibility and financial performance of listed consumer goods manufacturing firms in Nigeria between 2015 and 2020. The study sought to ascertain relationship between community development cost and return on equity, the relationship between training cost and return on equity, and finally, evaluate the moderating relationship of firm size on corporate social responsibility and financial performance of listed consumer goods manufacturing firms in Nigeria. Three hypotheses guided the study. The study was an ex post facto research design. The population of the study was twenty-one listed consumer goods manufacturing firms in the Nigeria Exchange Group were sampled to ten using purposive sampling technique. The data used in this study were sourced from annual reports and statement of accounts of the selected companies. Descriptive statistics, correlation analysis, unit root test and ordinary least Square regression were employed in analyzing the data with the help of E-view 10. The study found that there is a negative and significant relationship between community development cost and return on equity; there is a negative and significant relationship between training cost and return on equity and finally, Firm size has negative and significant moderating relationship with corporate social responsibility but has positive and significant moderating relationship with financial performance of listed consumer goods manufacturing firms in Nigeria. Based on the foregoing, the study concludes that there is a negative and significant relationship between corporate social responsibility and financial performance of listed consumer goods manufacturing firms in Nigeria.  The study recommended amongst others that corporate firms especially consumers good manufacturing firms should appraise corporate social responsibility activities before paying dividend to their shareholder in to maintain their image/reputation thereby increasing their returns because this study result confirmed that return on equity has significant relationship with corporate social responsibility.