Corporate Social Responsibility and Financial Performance of Deposit Money Banks in Nigeria
The research investigated the relationship between corporate social responsibility (CSR) and the financial performance of selected depository banks in Nigeria. The aim was to assess how different types of Corporate Social Responsibility (CSR) activities—such as Legal, Social, Ethical, Economic, and Philanthropic Responsibilities—impact the banks' profitability. This study is grounded in stakeholder theory, which emphasizes the importance of addressing the needs of various stakeholders, not just shareholders, for sustainable growth and profit. It utilized a significant amount of secondary data, sourced from the audited annual financial statements of selected depository banks listed on the Nigerian Stock Exchange (NSE) from 2014 to 2023. An ex-post facto research design was employed to facilitate the collection, presentation, analysis, and interpretation of the data. The study included all deposit money banks registered with the Central Bank of Nigeria (CBN), totaling twenty-eight banks, with a sample of ten chosen through purposive sampling. Data was extracted from the banks' annual reports, and statistical methods like Pearson correlation were used to analyze the relationship between CSR activities and financial performance. Findings indicated that most CSR activities positively correlate with Profit After Tax, though the significance varied. Notably, social and economic responsibilities showed strong positive correlations, highlighting that initiatives focused on community development and economic sustainability significantly enhance bank profitability.
Keywords: Corporate social responsibility, financial performance, deposit money banks, profit after tax
Citation: Adedoyin, A.R., & Moruff, A.O. (2024). Corporate Social Responsibility and Financial Performance of Deposit Money Banks in Nigeria. International Journal of Innovative Research in Accounting and Sustainability, 9(4), 79-88.