The impact of corporate social responsibility disclosure on financial performance: Evidence from the GCC Islamic banking sector

Platonova, Elena; Asutay, Mehmet; Dixon, Rob; Mohammad, Sabri

Abstract

This paper examines the relationship between corporate social responsibility (CSR) and financial performance for Islamic banks in the Gulf Cooperation Council (GCC) region over the period 2000–2014 by generating CSR-related data through disclosure analysis of the annual reports of the sampled banks. The findings of this study indicate that there is a significant positive relationship between CSR disclosure and the financial performance of Islamic banks in the GCC countries. The results also show a positive relationship between CSR disclosure and the future financial performance of GCC Islamic banks, potentially indicating that current CSR activities carried out by Islamic banks in the GCC could have a long-term impact on their financial performance. Furthermore, despite demonstrating a significant positive relationship between the composite measure of the CSR disclosure index and financial performance, the findings show no statistically significant relationship between the individual dimensions of the CSR disclosure index and the current financial performance measure except for ‘mission and vision’ and ‘products and services’. Similarly, the empirical results detect a positive significant association only between ‘mission and vision’ dimension and future financial performance of the examined banks.

• Journal Article Type: Article
• Acceptance Date: May 27, 2016
• Online Publication Date: Jul 1, 2016
• Publication Date: Aug 31, 2018
• Deposit Date: Mar 15, 2024
• Publicly Available Date: Mar 20, 2024
• Journal: Journal of Business Ethics
• Print ISSN: 0167-4544
• Electronic ISSN: 1573-0697
• Publisher: Springer Verlag
• Peer Reviewed: Peer Reviewed
• Volume: 151
• Issue: 2
• Pages: 451-471
• DOI: https://doi.org/10.1007/s10551-016-3229-0
• Public URL: https://uwe-repository.worktribe.com/output/11762058