CSR and financial performance: evidence from Pakistani banks

This research intends to explore the relation between the practices of Corporate Social Responsibility (CSR) and the financial performance of Bank, s using the measures of ROA and ROE. This research would help to improve the knowledge of managerial practices. The current study used Pakistan's banking industry as the empirical setting. The methodology of the study was based on the creation of a 34-item scale CSR Disclosure Index, to measure CSR and then regression results were applied to the models. The study concluded that all Banks in Pakistan view CSR practices as a strategic activity and they are included in the annual reports of banks. Also, public banks in Pakistan executed more CSR activities than private banks. Though there was strong positive association between CSR and ROA, there was only moderate positive association between CSR and ROE. Overall, Banks that implemented CSR practices tended to increase their profitability.