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Corporate social responsibility and financial performance: a case study based in Taiwan

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  • Yung-Heng Lee
  • Lori Tzu-Yi Yang

Abstract

This study investigates whether the impact of a firm’s CFP differs depending on the level of CSR performance and the amount of annual operating expenditure. The ‘Excellence in Corporate Social Responsibility TOP 50’ award results serve as the CSR performance indicator, and corporate annual financial performance data from 2013 to 2017 serve as empirical data. This study uses the panel smooth transition regression model. The findings reveal that the relationship between a firm’s operating expenditures and its profitability is non-linear, and with certain threshold values of CSR scores, operating spend has a more significant and negative effect on profitability. Firms that implemented more CSR measures experienced greater negative effects on profitability.

Suggested Citation

  • Yung-Heng Lee & Lori Tzu-Yi Yang, 2021. "Corporate social responsibility and financial performance: a case study based in Taiwan," Applied Economics, Taylor & Francis Journals, vol. 53(23), pages 2661-2670, May.
    • Handle: RePEc:taf:applec:v:53:y:2021:i:23:p:2661-2670
    DOI: 10.1080/00036846.2020.1866158
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    Cited by:

    1. Martin Kamau Muchiri & Szilvia Erdei-Gally & Mária Fekete-Farkas, 2022. "Effect of CSR on the Financial Performance of Financial Institutions in Kenya," Economies, MDPI, vol. 10(7), pages 1-23, July.
    2. Feng, Weilin & Meng, Yuqun & Tian, Li Grace & Tu, Steve & Wang, Yuran, 2023. "Corporate strategy and litigation risk," Finance Research Letters, Elsevier, vol. 58(PB).

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