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Social Responsibility Cost and Its Influence on the Profitability of Nigerian Banks

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  • Peter Kekung Bessong
  • Arzizeh Tiesieh Tapang

Abstract

This study aims at determining the influence of social responsibility cost on the profitability of Nigerian banks. In order to control environmental cost and the impact of the potential hazards presented by the operations of firms in the banking industry, such firms usually strive to act socially responsible ways. The study made used of an exploratory research design and data were collected from five Nigerian banks through secondary sources and analyzed using the Ordinary Least Square (OLS) method. The study revealed that there is a negative influence between social cost and pollution cost on profitability. Conclusively, social responsibility cost is as vital as all other liabilities of the banks, and it requires proper management. It is recommended that the Financial Reporting Council (FRC) of Nigeria should collaborate with other professional bodies, the academia and other stakeholders to produce a standard on social responsibility accounting and should ensure there is compliance and transparency in the process.

Suggested Citation

  • Peter Kekung Bessong & Arzizeh Tiesieh Tapang, 2012. "Social Responsibility Cost and Its Influence on the Profitability of Nigerian Banks," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 3(4), pages 33-45, October.
    • Handle: RePEc:jfr:ijfr11:v:3:y:2012:i:4:p:33-45
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    References listed on IDEAS

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    1. Gamble, George O. & Hsu, Kathy & Jackson, Cynthia & Tollerson, Cynthia D., 1996. "Environmental disclosures in annual reports: An international perspective," The International Journal of Accounting, Elsevier, vol. 31(3), pages 293-331.
    2. Rob Gray & Mohammed Javad & David M. Power & C. Donald Sinclair, 2001. "Social and Environmental Disclosure and Corporate Characteristics: A Research Note and Extension," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 28(3-4), pages 327-356.
    3. Roberts, Robin W., 1992. "Determinants of corporate social responsibility disclosure: An application of stakeholder theory," Accounting, Organizations and Society, Elsevier, vol. 17(6), pages 595-612, August.
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    Cited by:

    1. E. Jeroh, 2020. "Firms Attributes, Corporate Social Responsibility Disclosure and the Financial Performance of Listed Companies in Nigeria," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 10(6), pages 727-743, June.
    2. Jie Wu, 2014. "The Antecedents of Corporate Social and Environmental Irresponsibility," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 21(5), pages 286-300, September.
    3. John Ohaka & Odinakachukwu I. Ogaluzor, 2018. "Corporate Social Responsibility Accounting and the Effect of Donations on Profitability of Oil and Gas Companies in Nigeria," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 8(3), pages 265-276, July.
    4. T.A. Odetayo & A.Z. Adeyemi & A.S. Sajuyigbe, 2014. "Impact of Corporate Social Responsibility on Profitability of Nigeria Banks," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 4(8), pages 252-263, August.

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