The impact of corporate social responsibility on corporate financial performance in India: an investigation using data envelopment analysis

The paper emphasised the technical efficiency of Indian corporates and explored the drivers of high efficiency. This study applies multiple methods, i.e., data envelopment analysis and free disposal hull, to observe the efficiency rankings of the Indian companies. In the second stage, we perform a truncated regression analysis to validate our results on the association between corporate social responsibility and corporate financial performance. The findings suggest that 20 corporates from 87 corporates are technical efficient (TE = 1) in all frontier approaches. Further, it has been observed that the three pillars of corporate social responsibility (i.e., environment, social, and governance) positively correlate with efficiency. Furthermore, it has also been observed that all three pillars of corporate social responsibility are positively related to return on assets. The findings can be helpful for the stakeholders, policymakers, and management as a guideline for implementing corporate social responsibility practices.