Open AccessModerating role of financial ratios in corporate social responsibility disclosure and firm value
Author(s) -
Muhammad Akram Naseem,
Jun Lin,
Ramiz Ur Rehman,
Muhammad Ishfaq Ahmad,
Rizwan Ali
Publication year - 2019
Publication title -
plos one
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.99
H-Index - 332
ISSN - 1932-6203
DOI - 10.1371/journal.pone.0215430
Subject(s) - moderation , corporate social responsibility , business , accounting , stock exchange , enterprise value , value (mathematics) , financial ratio , finance , public relations , psychology , social psychology , machine learning , political science , computer science
This study investigates the link between corporate social responsibility (CSR) disclosure for multi-stakeholders and financial performance of a firm through accounting-based activities for CSR. A dataset of Chinese non-financial firms listed on the Shanghai Stock Exchange from 2008 to 2012 is taken from the China Stock Market & Accounting Research database. The study compares different financial ratios of CSR disclosure and non-disclosure firms. Moreover, the financial ratios of CSR disclosure firms also compare with the industry averages. The results suggest that the financial of CSR disclosure firms are better than both CSR non-disclosure firms and industry averages. These financial ratios ensure the claim of a firm that they are socially responsible toward multi-stakeholders. Further, the same financial ratios are used as moderator variables between CSR disclosure for multi-stakeholders (independent variable) and firm financial performance (dependent variable). The relationship between CSR disclosure and firm value is moderated by the financial ratios. The moderation effect of financial ratios is rarely used in the literature of CSR disclosure and firm value.