| Summary: | The research on the relationship between Corporate Social Responsibility (CSR) and
financial performance has been carried out in various geographical locations and various
parameters for defining proxies for CSR and financial performance has been used. But there
were lots of constraints and contingencies due to various proxies used for financial
performance, multi industry analysis and variations and inconsistency in data selection,
methodology (Karake, 1999).
Using data over the time period of four years, this study investigate and examine the link
between corporate social responsibility and financial performance across cultures. The
clusters included in this study are Asia, Europe and UK/US. Two studies are conducted, first
comprise of the single industry study of automobile concerns across the globe based on their
ethical rankings and cover the years 2005-2008.The second study take into account the
differences in the level of CSR across 3 clusters and its link with financial performance in
multi-industry concern. The relationship is analysed by means of empirical techniques using
ANOVA, t-test and regression analysis. The outcomes are that the companies of UK-US
clusters show highest involvement in the CSR activities followed by Europe and then Asia.
A mixed relationship was established between CSR and FP across all the clusters. UK-US
showed highest positive relationship between the CSR and the financial performance. In our
study, it was discovered that with the change of proxies for CSR and FP, the relationship
established also changes.
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