An Investigation of the Relationship between Corporate Social Responsibility and Corporate Financial Performance in Egypt: The Mediating Role of Information Asymmetry

  • Nancy Mohamed Accounting Department, Cairo University, Cairo, Egypt
  • Ahmed Rashed Finance Department, Faculty of Commerce, Cairo University, Cairo, Egypt

Abstract

The aim of this paper is to investigate the impact of corporate social responsibility (CSR) on corporate financial performance (CFP) through information asymmetry (IA) as a mediator. The study involved the whole sectors in the listed companies on Egx100 excluding Financial sectors (banks and financial services) from 2013-2017 using smart PLS (Partial Least Square). CSR is measured using CSR index, while Share turnover ratio is used to measure IA. CFP is divided into three indicators: ROA, ROE and ROS. The Structural model assessment reveals that CSR has a positive and significant effect on CFP. This means that those listed companies engaged in CSR activities achieved better financial performance than non- CRS companies. The CSR proved to have a negative and significant effect on the IA. This shows that CSR activities lead to decreased IA. Finally, this research found that CSR activities will improve CFP through IA.

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Published
2021-04-30
How to Cite
MOHAMED, Nancy; RASHED, Ahmed. An Investigation of the Relationship between Corporate Social Responsibility and Corporate Financial Performance in Egypt: The Mediating Role of Information Asymmetry. Journal of Accounting, Business and Management (JABM), [S.l.], v. 28, n. 1, p. 73-86, apr. 2021. ISSN 2622-2167. Available at: <http://journal.stie-mce.ac.id/index.php/jabminternational/article/view/827>. Date accessed: 23 sep. 2021. doi: https://doi.org/10.31966/jabminternational.v28i1.827.
Section
Articles