CORPORATE SOCIAL RESPONSIBILITY AND CORPORATE FINANCIAL PERFORMANCE: RELATIONSHIPS IN DIFFERENT COUNTRIES

Abstract

This study aims to examine literature about relationship between corporate social responsibility (CSR) and financial performance (CFP) in different countries. The studies from nine different countries were examined. The results indicate that there are three groups of results. Three different types of relationships between CSR and CFP can be identified: positive, negative and neutral. We claim, that researchers of 9 different countries use quite the same methodology to different to examine the relation between CSR and CFP for different types of companies. However, CSR is strongly influenced by cultural and socio-economic environments and relates to a country’s national business system. Political institutions are potential drivers of CSR as well. Moreover, informal institutions such as national cultures have an important effect on CSR practices. The national business system of the specific country creates the conditions under which corporations are more or less likely to engage in socially responsible behavior. For instance, in countries with a high degree of union power, firms perform better on the social and environmental scores. So, variety of legislative basis and national institutions (political, market, cultural) are drivers of CSR. They is a specific for each country. Due to that, all examined studies are incomparable because of the national institutions’ difference that drive responsible behavior of the companies. The results in one country can differ in another. This article adds to the previous research devoted to the relationship between CSR and CFP. Firstly, the study enhances understanding of the relationship between CSR and CFP. Secondly, this study expands information about CSR in different countries to scholars and researchers. It also contributes to investors, who consider CSR in decisions making process.