Corporate Social Responsibility and Firms' Performance: A Literature Review

Abstract

Corporate Social Responsibility (CSR) has been of great contribution especially when it has to do with the success of firms both locally and globally. Even though the concept has become a widely accepted and recognized to be of paramount significance to the growth in value of organizations, some corporate firms are yet to embrace this CSR concept, most corporate bodies focus on achieving profit but neglect the issues that has to do with both the environment and that of the other stakeholders not directly associated with the organization. To this end, the focus of this study is on a holistic assessment of the impact of CSR on organizational performance. This study adopted exploratory research design and since the major emphasis in such a study is on the discovery of ideas and insights, desk review approach was adopted using relevant and related literature. The study showed that some companies only engage in CSR activities just to create good corporate citizen image. The outcome also showed that CSR has an important and positive impact on all the performance indicators used in the review of literatures which are: organizational performance versus time, finance, reputation, employee commitment and brand differentiation. It was therefore recommended that companies should identify their stakeholders' needs before taking CSR initiatives; also, top management must understand the strategic financial benefits of CSR activities and include CSR initiates in their strategic plan.