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The Nexus Between CSR Practices and Financial Performance: Empirical Evidence from the Manufacturing Sector in India

  • Joselin D Joselin D CHRIST (Deemed to be University), Bengaluru. India Joselin D ORCID Id ,  
  • Animesh Singh* Animesh Singh Corresponding author Chandigarh University, Mohali, Punjab. India Animesh Singh ORCID Id ,  
  • Kunwar Siddharth Tiwary Kunwar Siddharth Tiwary University of the Cumberland, Kentucky, USA. American Samoa Kunwar Siddharth Tiwary ORCID Id
Received: March 04, 2025
Accepted: April 02, 2025
Published: June 13, 2025
Volume: 1 (1) | Page: 1-13

Abstract

This research investigates the association between corporate social responsibility (CSR) and the financial performance of manufacturing firms listed in India subsequent to the enactment of The Companies Act, 201, Section 135. This paper uses the pooled OLS, random effect panel regression model, multicollinearity, and normality test for data analysis on 41 manufacturing companies top listed in nifty 100 for the duration of 2015 2023. The empirical study of this manuscript determines that CSR expenses have a positive link with ROE and ROA and adverse link with Tobin’s Q. The implications of this manuscript are for customers, investors, managers and contributors. Therefore, this study can give some insights into how much organisations spend on CSR activities and its effect on FP after adopting CSR practices. The study can also be used by policymakers to evaluate the effectiveness of present CSR regulations and to make necessary amendments to promote better CSR practices. This manuscript highlights the gap in the link between CSR and the FP of the listed manufacturing companies from the Nifty 100 index of India with recent data.

Keywords: corporate social responsibility (CSR), India, mandatory CSR, firm performance, corporate social responsibility, ROA, ROE, Tobin’s Q

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