Corporate Social Responsibility and Financial Performance in the Banking Industry in Ghana

Abstract

The purpose of this study is to investigate the effect of corporate social responsibility on financial performance to understand whether and how CSR policies impact the overall financial performance of listed banks in Ghana. Secondary data have been collected, content analysis was used to measure corporate social responsibility and financial performance, and a multiple panel regression approach using eight listed banks was used. Results indicate that corporate social responsibility is found to be positively and statistically significantly related to financial performance. Nevertheless, the effect of CSR is very weak. A significant relationship between size, inflation, and exchange rate and financial performance is found. For CSR to become development tool in Ghana, it is imperative that coordinated and concerted efforts must be undertaken at both private and public sector levels, in realising equitable, inclusive, and sustainable development.