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The "Virtuous Circle" Between Corporate Social Performance and Corporate Financial Performance in the European Banking Sector

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  • Candida Bussoli
  • Danilo Conte

Abstract

This paper analyses the relationship between Corporate Social Performance (CSP) and Corporate Financial Performance (CFP) in the European banking sector. The good management approach and the slack resources approach have been tested, and the paper aims to verify the existence of a "virtuous circle" between the two performance measures. The econometric analysis, based on panel data, is performed on a sample of 71 listed banks (EU28) in the period between 2011 and 2015. The main findings show a positive influence of CSP on CFP, confirming the good management approach. However, the results demonstrate a negative influence of CFP on CSP, which generates the impossibility of confirming the theoretical assumptions of the slack resources approach. Therefore, the existence of a "virtuous circle" deriving from the integration of the two approaches is not supported.

Suggested Citation

  • Candida Bussoli & Danilo Conte, 2018. "The "Virtuous Circle" Between Corporate Social Performance and Corporate Financial Performance in the European Banking Sector," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 9(2), pages 80-92, March.
    • Handle: RePEc:jfr:ijba11:v:9:y:2018:i:2:p:80-92
    DOI: 10.5430/ijba.v9n2p80
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    References listed on IDEAS

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    Cited by:

    1. Francesco Manta & Annunziata Tarulli & Domenico Morrone & Pierluigi Toma, 2020. "Toward a Quadruple Bottom Line: Social Disclosure and Financial Performance in the Banking Sector," Sustainability, MDPI, vol. 12(10), pages 1-18, May.

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