What is the relationship between social responsibility and profitability in a business?
@inproceedings{Wang2014OnTR,
title={On the Relationship between CSR and Profit},
author={Shuqin Wang},
year={2014}
}What is the relationship between CSR and profit? Which one should be given more priority? It is not only a realistic problem for corporations, but also a theoretical and practical subject for scholars to study systemically. Milton Friedman (1970) holds the idea that, as economic organizations, corporations should prefer profit and wealth for the sake of shareholders. In fact, the attitude of corporations towards CSR is, to a large extent, dependent on the relationship between social… Show
10 CitationsReferencesSHOWING 1-8 OF 8 REFERENCES The Capital Theory of Sustainable Development and the Philosophical Reflection of Capital Logic
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AbstractThe traditional goal of a company is to earn profit to pay its shareholders, but, nowadays, for the business to be sustainable in the long term, a strategy of Corporate Social Responsibility (CSR) activities is needed to meet stakeholder demands, respect ethical principles and give an appropriate answer to organizational stakeholders. The objective of the paper is to identify how strong the correlation between CSR and profit is, and how companies behave in the periods they have losses, whether they continue to do CSR activities, they reduce the activities, or they give them up. Thus, CSR is attributed to the concept of “doing good” and profit to the expression of “doing well”, from which a “positive business” can be built. Our empirical research consists of a panel data econometric model using logistics regressions to highlight the correlation between profit and the decision to do CSR activities and feasible generalized least squares (FGLS) regressions to identify the correlations between the level of CSR activities and the dimension of profit, an expression of financial performance. The main results emphasize that the companies which implement CSR activities in a greater extent are more profitable in economic terms. Suggested CitationHandle: RePEc:gam:jsusta:v:10:y:2018:i:4:p:1041-:d:139072 Download full text from publisherReferences listed on IDEAS
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What is the relationship between business and social responsibility?Social responsibility means that besides maximizing shareholder value, businesses should operate in a way that benefits society. Socially responsible companies should adopt policies that promote the well-being of society and the environment while lessening negative impacts on them.
Is there a positive relationship between CSR and profitability?The correlation between these variables and CSR performance was examined through correlation and regression analysis. The results confirm that CSR performance has a partial positive correlation with profitability and firm value.
Can a business be both profitable and socially responsible?Can companies be socially responsible and make a profit at the same time? The short answer is yes, sustainability can deliver significant benefits, including to your organization's bottom line.
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