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How corporate social responsibility boosts firm financial performance: The mediating role of corporate image and customer satisfaction

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  • Hafiz Yasir Ali
  • Rizwan Qaiser Danish
  • Muhammad Asrar‐ul‐Haq

Abstract

A great number of studies have been conducted to examine the direct impact of corporate social responsibility on firm's financial performance, but this direct relationship seems to be spurious and imprecise. Therefore, the main purpose of this study is to investigate the intervening role of corporate image and customer satisfaction on the relationship between corporate social responsibility and financial performance. Data is collected from 229 companies listed on Pakistan stock exchange using simple random sampling technique. Structural equation modelling has been used for the measurement model and for hypotheses testing. Results indicate that corporate image and customer satisfaction partially mediate the association between corporate social responsibility and financial performance. The study concludes that corporate social responsibility significantly affects the firm's financial performance by developing a positive image among the stakeholders and decreasing overall costs. This study will help management of organizations to realize the importance of corporate social responsibility.

Suggested Citation

  • Hafiz Yasir Ali & Rizwan Qaiser Danish & Muhammad Asrar‐ul‐Haq, 2020. "How corporate social responsibility boosts firm financial performance: The mediating role of corporate image and customer satisfaction," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(1), pages 166-177, January.
    • Handle: RePEc:wly:corsem:v:27:y:2020:i:1:p:166-177
    DOI: 10.1002/csr.1781
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