EFFECT OF CORPORATE SOCIAL RESPONSIBILITY ON INVESTMENT EFFICIENCY OF QUOTED OIL AND GAS FIRMS IN NIGERIA
DOI:
https://doi.org/10.29121/granthaalayah.v9.i11.2021.4258Keywords:
Corporate Social Responsibility, Quoted Oil and Gas Firms, Investment EfficiencyAbstract [English]
This study examined effect of corporate social responsibility (CSR) on investment efficiency of quoted oil and gas firms in Nigeria. The study employed Ex post facto research design. The sample size of seven (7) oil and gas firms was derived from the population of the quoted twelve (12) oil and gas firms in Nigeria. Judgmental approach was employed during the sampling procedure. The study used secondary data sourced from the annual reports of the quoted oil and gas firms in Nigeria Stock Exchange fact books of official lists covering a ten-year period (2010-2019). The study employed Multiple Regression Model as the technique of data analysis with the aid of SPSS 23 statistical software. Analysis of findings showed that CSR charitable donation expenditure, CSR expenditure on education and CSR societal expenditure reveal significant relationship with investment efficiency of oil and gas firms in Nigeria. Nevertheless, CSR health expenditure and CSR environmental expenditure show insignificant effect on investment efficiency of oil and gas firms in Nigeria. The study also reveals that there is significant relationship between CSR sports expenditure and investment efficiency of oil and gas firms in Nigeria. With respect to the findings, the study recommends that the oil and gas firms should boost and monitor their CSR charitable donation expenditure, CSR on health expenditures, CSR environmental and CSR sport expenditures and observe them closely since they reveal negative effect. The study also recommends that CSR expenditure on education and CSR societal expenditure should be upheld and sustained since they reveal significant positive effect on investment efficiency of oil and gas firms in Nigeria.
Downloads
References
Al Qaisi, F. (2019). Corporate social responsibility effect on firm's financial performance in Jordan, Int. J. Monetary Economics and Finance, 12 (4), pp.325-342. Retrieved from https://doi.org/10.1504/IJMEF.2019.101942 DOI: https://doi.org/10.1504/IJMEF.2019.101942
Anwar, R, & Malik, J.A. (2020). When does corporate social responsibility disclosure affect investment efficiency? A new answer to an old question. 10.1177/2158244020931121 journals.sagepub.com/home/sgo. Retrieved from https://doi.org/10.1177/2158244020931121 DOI: https://doi.org/10.1177/2158244020931121
Benlemlih, M., & Bitar, M. (2015). Corporate social responsibility and investment efficiency. Academy of Management Proceedings,2015(1). Retrieved from https://doi.org/10.5465/ambpp.2015.12768abstract DOI: https://doi.org/10.5465/ambpp.2015.12768abstract
Benlemlih, M., & Bitar, M. (2018). Corporate social responsibility and investment efficiency. Journal of Business Ethics, 148(3), 647-671. Retrieved from https://doi.org/10.1007/s10551-016-3020-2 DOI: https://doi.org/10.1007/s10551-016-3020-2
Carroll, A. B. (2016). Carroll's pyramid of CSR: taking another look. International Journal of Corporate Social Responsibility, 1(1). Retrieved from https://doi.org/10.1186/s40991-016-0004-6 DOI: https://doi.org/10.1186/s40991-016-0004-6
Chih, H. H., Miao, W. C., & Chuang, Y. C. (2014). Is corporate social responsibility a double-edged sword? Evidence from fortune glob.
Cho, S. J., Chung, C. Y., & Young, J. (2019). Study on the relationship between CSR and financial performance. Sustainability (Switzerland), 11(2). Retrieved from https://doi.org/10.3390/su11020343 DOI: https://doi.org/10.3390/su11020343
Cook, K. A., Romi, A. M., Sánchez, D., & Sánchez, J. M. (2019). The influence of corporate social responsibility on investment efficiency and innovation. Journal of Business Finance & Accounting, 46(3-4), 494-537. Retrieved from https://doi.org/10.1111/jbfa.12360 DOI: https://doi.org/10.1111/jbfa.12360
Elberry, Noha, and Khaled Hussainey. (2020). Does corporate investment efficiency affect corporate disclosure practices? Journal of Applied Accounting Research 21: 309-27. Retrieved from https://doi.org/10.1108/JAAR-03-2019-0045 DOI: https://doi.org/10.1108/JAAR-03-2019-0045
Erawati, N.M.A, Sutrisno, T, Hariadi, B, & Saraswati, E. (2020). The role of corporate social responsibility in the investment efficiency: Is It Important? Journal of Asian Finance, Economics and Business, 8 (1), 169-178. Online ISSN 2288-4645 doi: 10.13106. Retrieved from https://www.koreascience.or.kr/article/JAKO202100569391284.page
Ezeji, C.E. and Okonkwo, O.N. (2016). Corporate social responsibility: a study of oil transnational corporations in Nigeria. International Journal of Business & Law Research 4(2):1-9. Retrieved from http://seahipaj.org/journals-ci/june-2015/june-2016/IJBLR/full/IJBLR-J-1-2016.pdf
Fernando, S., & Lawrence, S. (2014). A theoretical framework for CSR practices: Integrating legitimacy theory, stakeholder theory and institutional theory. Journal of Theoretical Accounting, 10(1). Retrieved from https://www.researchgate.net/profile/Susith-Fernando/publication/290485216_A_theoretical_framework_for_CSR_practices_Integrating_legitimacy_theory_stakeholder_theory_and_institutional_theory/links/5a8629ee458515b8af890861/A-theoretical-framework-for-CSR-practices-Integrating-legitimacy-theory-stakeholder-theory-and-institutional-theory.pdf
Freeman, R. E., & Dmytriyev, S. (2017). Corporate social responsibility and stakeholder theory: Learning from each other. Symphonya. Emerging Issues in Management, 2(1),7-15. Retrieved from https://doi.org/10.4468/2017.1.02freeman.dmytriyev. DOI: https://doi.org/10.4468/2017.1.02freeman.dmytriyev
Ho, K-C., Li, H-M., & Gong, Y. (2021). How does corporate social performance affect investment inefficiency? An empirical study of China market. http://www.elsevier.com/journals/borsa-istanbul-review/2214-8450. Retrieved from https://doi.org/10.1016/j.bir.2021.06.016 DOI: https://doi.org/10.1016/j.bir.2021.06.016
Ibrahim, A, & Ibrahim, A. (2021). The impact of risk disclosure on investment efficiency. Alexandria Journal of Accounting Research (5) 1.
Idowu, A. (2014). CSR in Nigerian banking industry : when will the lip-service games end ? 5(22). Retrieved from https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.999.7615&rep=rep1&type=pdf
Iqbal, N., Ahmad, N., & Kanwal, M. (2013). Impact of CSR on profitability of Islamic and conventional financial institutions. Applied mathematics in engineering, management and technology 1(2). Retrieved from https://www.researchgate.net/profile/Naveed-Ahmad-9/publication/259560031_Impact_of_Corporate_Social_Responsibility_on_Profitability_of_Islamic_and_Conventional_Financial_Institutions/links/5866f8f008aebf17d39aeca1/Impact-of-Corporate-Social-Responsibility-on-Profitability-of-Islamic-and-Conventional-Financial-Institutions.pdf
Ishola, J.A. & Ishola, O. P. (2019). Corporate social responsibilty: its effects on the performance of insurance sector in Nigeria. Ilorin journal of human resource management (ijhrm). 3(2), 21-33.
Jajić, B., & Jajić, J. (n.d) (2021). CSR and sport. University of educons, Serbia.JEL classification: L83, M14.
Kajola, S. O., Anene, E. C., & Desu, A. A. (2017). Corporate social responsibility and financial performance of the Nigerian listed firms. 2(1), 71-82. Retrieved from https://www.futa.edu.ng/journal/papers/paper_6_1530187570.pdf
Kajola, S.O. Adedeji, S. B. Olabisi, J., & Babatolu, A.T. (2018), Effect of credit risk management on financial performance of Nigerian listed deposit money banks. Policy & governance ISSN 2394-3351. 5 (6).. Retrieved from https://doi.org/10.19085/journal.sijbpg050601 DOI: https://doi.org/10.19085/journal.sijbpg050601
Lee, M. (2020). Corporate social responsibility and investment efficiency: Evidence from an Emerging Asian Market.p. De La Salle University Research Article. Pp.1-16.
Ma, L., Ma, S., & Tian, G. (2017). Corporate opacity and cost of debt for family firms. European Accounting Review, 26(1), 27-59. Retrieved from https://doi.org/10.1080/09638180.2015.1087868. DOI: https://doi.org/10.1080/09638180.2015.1087868
Madugba, J.U. & Okafor, M.C. (2016). Impact of corporate social responsibility on financial performance: Evidence from listed banks in Nigeria. Expert journal of finance. (4)(1), 1-9. Retrieved from https://finance.expertjournals.com/23597712-401/
Mallouh, A. A., & Tahtamouni, A. (2018). The impact of social responsibility disclosure on the liquidity of the Jordanian industrial corporations The impact of social responsibility disclosure on the liquidity of the Jordanian industrial corporations Alaa Abu Mallouh Asem Tahtamouni *. December. Retrieved from https://doi.org/10.1504/IJMFA.2018.093504 DOI: https://doi.org/10.1504/IJMFA.2018.093504
Mandal, K., & Banerjee, S. (2015). Is 'Societal expenditure' an alternative route to business success? an empirical study. Journal of Advanced Management Science, 3(1). Retrieved from https://doi.org/10.12720/joams.3.1.31-37 DOI: https://doi.org/10.12720/joams.3.1.31-37
Mann, S. V., & Sicherman, N. W. (1991). The agency costs of free cash flow: Acquisition activity and equity issues. Journal of Business, 64, 213-227. Retrieved from https://doi.org/10.1086/296534 DOI: https://doi.org/10.1086/296534
McLean, R. D., Zhang, T., & Zhao, M. (2012). Why does the law matter? Investor protection and its effects on investment, finance, and growth. Journal of Finance. Retrieved from https://doi.org/10.1111/j.1540-6261.2011.01713.x DOI: https://doi.org/10.1111/j.1540-6261.2011.01713.x
Mentor, M. (2016). "The effects of corporate social responsibility on financial performance". Retrieved from https://stars.library.ucf.edu/honorstheses/47.
Mogaka, M.M.(2016). Effect of corporate social responsibilty on financial performance of in telecommunication industry in Kenya, M.Sc.dissertation, University of Nairobi.
Mohammadi, S. M. (2014). The relationship between financial reporting quality and investment efficiency in Tehran stock exchange. International Journal of Academic Research in Business and Social Sciences, 4, 104-113. Retrieved from https://doi.org/10.6007/IJARBSS/v4-i6/930 DOI: https://doi.org/10.6007/IJARBSS/v4-i6/930
Mwangangi, S. A.(2018) Effect of corporate social responsibility on performance of manufacturing firms in Kenya. Unpublished Ph.D thesis. Jomo Kenyatta University of Agriculture and Technology.
Ohaka, J., & Ogaluzor, O. I. (2018). CSR accounting and the effect of corporate social responsibility accounting and the effect of donations on profitability of oil and gas companies in Nigeria. November. Retrieved from https://doi.org/10.6007/IJARAFMS/v8-i3/4835 DOI: https://doi.org/10.6007/IJARAFMS/v8-i3/4835
Omran, M.A., & Ramdhony, D. (2015). Theoretical perspectives on corporate social responsibility disclosure: A critical review. 5 (2). https://www.researchgate.net/publication/280155907 . DOI: https://doi.org/10.5296/ijafr.v5i2.8035
Samet, M., & Jarboui, A. (2017). How does corporate social responsibility contribute to investment efficiency? Journal of multinational financial management, 40, 33-46. Retrieved from https://doi.org/10.1016/j.mulfin.2017.05.007 DOI: https://doi.org/10.1016/j.mulfin.2017.05.007
Tijani, A.A., Adeoye, A. O., & Alaka, N. S. (2017). Effects of corporate social responsibility on banks financial performance in Nigeria : A Study of United Bank of Africa. December 2018. Retrieved from https://www.researchgate.net/profile/Abayomi-Adeoye/publication/322205356_Effects_of_Corporate_Social_Responsibility_on_Banks_Financial_Performance_in_Nigeria_A_Study_of_United_Bank_of_Africa/links/5c21be0ea6fdccfc70670e98/Effects-of-Corporate-Social-Responsibility-on-Banks-Financial-Performance-in-Nigeria-A-Study-of-United-Bank-of-Africa.pdf
Ugwukah, A, C., & Ohaja, O. I., (2016). Historigraphic assessment of the petroleum industry and its impact on the Nigerian economy. Historical www.iiste.org ISSN 2224-3178 (Paper) ISSN 2225-0964 (Online), Vol. 36. Retrieved from https://publication.babcock.edu.ng/asset/docs/publications/HIST/9672/3145.pdf
Vassiliou, M.S. (2018). Historical dictionary of the petroleum industry.ISBN: 9781538111598. TN865 .V38 2018.
Yazdani, R., & Barzegar, G.(2017). The relationship between corporate social responsibility and investment performance of companies listed in Tehran Stock Exchange. Science Arena Publications Specialty Journal of Accounting and Economics Available online at www.sciarena.com,3(1):67-72. Retrieved from https://sciarena.com/storage/models/article/d3d5FQvj5qQqlgPvA0ZmjtxJPXCn7SBwEc7GKHibTiz4xy4sk0erpv78dfoJ/the-relationship-between-corporate-social-responsibility-and-investment-performance-of-companies-l.pdf
Zhong, M. (2017). Does corporate social responsibility disclosure improve firm investment efficiency? Evidence from China. Review of Accounting and Finance, 16(3), 348-365. Retrieved from https://doi.org/10.1108/RAF-06-2016-0095
Zhong, M., & Gao, L. (2017). Does corporate social responsibility disclosure improve firm investment efficiency? Evidence from China. Review of Accounting and Finance, 16(3), 348-365. Retrieved from https://doi.org/10.1108/RAF-06-2016-0095 DOI: https://doi.org/10.1108/RAF-06-2016-0095
Published
How to Cite
Issue
Section
License
Copyright (c) 2021 K.F.A. Ibrahim (Ph.D.), Ademu, Sylvester Onyekachi (M.Sc.)
This work is licensed under a Creative Commons Attribution 4.0 International License.
With the licence CC-BY, authors retain the copyright, allowing anyone to download, reuse, re-print, modify, distribute, and/or copy their contribution. The work must be properly attributed to its author.
It is not necessary to ask for further permission from the author or journal board.
This journal provides immediate open access to its content on the principle that making research freely available to the public supports a greater global exchange of knowledge.
