CORPORATE SOCIAL RESPONSIBILITY ACCOUNTING AND FINANCIAL PERFORMANCE OF OIL AND GAS COMPANIES IN NIGERIA.
Abstract
This study evaluates the influence of corporate social responsibility reporting on firm performance as captured via their net profit margin and return on assets over the study period of 2012 to 2022. The study employed the stationarity test because of its statical properties, the panel regression test in its pooled random and fixed effects variants, followed by the co-integration test, error correction model and stacked granger causality test that analyzed causal relationship between relevant variables. The research employed secondary data which were obtained from annual report of quoted oil and gas companies to test seven hypotheses related to community development costs, human capacity development costs, employee benefit costs, and firm size. The findings reveal a significant positive relationship between community development costs and net profit margin, emphasizing the impact of strategic investments in community development on profitability. However, no significant relationship is found between community development costs and return on asset. Human capacity development costs did not exhibit a significant relationship with either net profit margin or return on asset. Notably, a negative relationship is identified between employee benefit costs and net profit margin, prompting recommendations for careful management of benefit programs. Firm size positively moderates the relationship in the net profit margin model, indicating potential advantages for larger companies, while its impact on return on asset is not statistically significant. Therefore, the study advises decision-makers to act towards optimizing resource allocation, fostering sustainable community development, and maintaining a balanced approach to employee benefits.
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Published in JOURNAL OF BUSINESS & ECONOMY
ISSN: 2808-5428
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