Corporate Social Responsibility and Financial Performance: Evidence from Listed Industrial Goods Companies in Nigeria

Abstract

Despite reporting enormous annual profits, Nigerian industrial goods firms have not done enough to promote the social welfare of the internal and external environments in which they operate. Thus, the study examines the corporate social responsibility (CSR) and financial performance of listed industrial goods companies operating in Nigeria. The study explicitly used donations, training costs, and medical costs to gauge CSR, whereas net profit margin was used to assess financial performance. The study used an ex post facto research approach and secondary data from ten of the thirteen Nigerian listed industrial products companies. The data came from the annual reports and financial statements of the chosen firm for ten years, from 2015 to 2024. The gathered data was analysed using correlation, multiple regression, and descriptive statistics. The findings demonstrated that contributions (p-value = 0.0113 < 0.05) significantly impact the net profit margin of listed industrial goods companies in Nigeria, although health and training expenses (p-value = 0.7630, 0.5314 > 0.05) do not. When assessing the net profit margin of the selected Nigerian industrial goods companies, the study concludes that although potential and current investors may rely on contributions, they cannot rely on health and training expenditures. Therefore, it was advised that management of Nigerian listed industrial goods companies invest more in staff training and safety as these expenses would surely affect each company's financial performance.