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Social and Financial Performance on Corporate Governance

Social and Financial Performance on Corporate Governance

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Reference ID: PS-13322-TM

DEDICATION

This research material titled “Social and Financial Performance on Corporate Governance” is dedicated to God for his enabling grace, and to all computer enthusiasts who contributed to make life a pleasant experience during my research documentation.

ACKNOWLEDGEMENT

I extend my sincere gratitude to all those who contributed to the completion of this project. Special thanks to my Supervisor (Name of your Supervisor), the Head of Department (Name of your HOD), the Lecturers in the department of Accountancy / Accounting, Book Authors and Profound Scholars of existing or related project material on “Social and Financial Performance on Corporate Governance” for their invaluable guidance, support, and expertise throughout the journey.

I am also grateful to your study area (mention any funding organizations, if applicable) for their financial assistance. This research would not have been possible without the encouragement and assistance of some stakeholders (mention any mentors, teachers, or colleagues). Additionally, I would like to acknowledge the understanding and patience of my family and friends during this endeavor. Your unwavering support has been a constant source of motivation. Thank you all for being part of this meaningful endeavor.

TABLE OF CONTENTS

PRELIMINARY PAGES


CHAPTER ONE

INTRODUCTION


    CHAPTER TWO

    LITERATURE REVIEW

    • 2.1 Introduction
    • 2.2 Conceptual Review
    • 2.3 Theoretical Framework
    • 2.4 Empirical Studies

    CHAPTER THREE

    RESEARCH METHODOLOGY

    • 3.1 Introduction
    • 3.2 Research Design
    • 3.3 Population of Study
    • 3.4 Sampling and Sampling Technique
    • 3.5 Validation of Research Instrument
    • 3.6 Method of Data Collection
    • 3.7 Method of Data Analysis
    • 3.8 Questionnaire Administration
    • 3.9 Ethical Consideration
    • 3.10 Statistical Analysis

    CHAPTER FOUR

    DATA ANALYSIS, RESULT AND DISCUSSION

    • 4.1 Introduction
    • 4.2 Presentation and Analysis of Data
    • 4.3 Re-statement of Research Questions
    • 4.4 Test of Hypotheses
    • 4.5 Discussion of Findings

    CHAPTER FIVE

    SUMMARY, CONCLUSION AND RECOMMENDATION

    • 5.1 Introduction
    • 5.2 Summary of Findings
    • 5.3 Conclusion
    • 5.4 Recommendation
    • 5.5 Suggestion for Further Study

    REFERENCES

    APPENDIX A - “QUESTIONNAIRE”

    ABSTRACT

    One of the roles of accounting is to provide information on business performance, either through financial accounting indicators or otherwise. Theoretical-empirical studies on the relationship between Corporate Financial Performance (CFP) and Corporate Social Performance (CSP) have increased in recent years, indicating the development of this research field. However, the contribution to theory by empirical studies is made in an incremental manner, given that each study normally focuses on a particular aspect of theory. Therefore, it is periodically necessary to conduct an analysis to evaluate how the aggregation of empirical studies has contributed to the evolution of theory. Designing such an analysis was the objective of the present study. The theoretical framework covered the following: stakeholder theory, the relationship between CSP and CFP, good management theory, and slack resource theory. This research covered a 15-year period (1996 to 2010), and the data collection employed a search tool for the following databases: Ebsco, Proquest, and ISI. The sampling process obtained a set of 58 exclusively theoretical-empirical and quantitative articles that test the CSP-CFP relationship. The main results in theoretical field reinforce the proposed positive relationship between CSP and CFP and good management theory and demonstrate a deficiency in the explanation of the temporal lag in the causal relationship between CSP and CFP as well as deficiencies in the description of the CSP construct. These results suggest future studies to research the temporal lag in the causal relationship between CSP and CFP and the possible reasons that the positive association between CSP and CFP has not been assumed in some empirical studies.


    Social and Financial Performance on Corporate Governance

    CHAPTER ONE

    1.0 Introduction

    1.1 Background Of The Study

    One of the roles of accounting is to produce information on business performance (Gaspareto, 2004). This performance may be measured from the perspective of monetary values, normally using financial-accounting information, and/or from the perspective of non-monetary information (Hendriksen & Van Breda, 1999). The measurement of performance by non-monetary indicators is more recent and has increased in acceptance, particularly as a function of the contemporary concern regarding the social action of organizations (Oliveira, De Luca, Ponte, & Pontes Junior, 2009). The theme of the present study fits within this context of accounting, focusing on Corporate Financial Performance (CFP) and Corporate Social Performance (CSP).

    There is a perception that studies related to stakeholder theory, more specifically with regard to theoretical-empirical studies on the relationships of CFP and CSP, have increased in recent decades. However, this process of theoretical development through empirical contributions is normally performed in a precise manner, with each study pointing to a specific problem in theory or presenting a possible explanation of a theoretical gap. Periodically, therefore, it is convenient to develop studies that seek to analyze, in an aggregate manner, the evolution of a research field. In this regard, the objective of the present study was to investigate the evolution of the conceptual and methodological aspects of these theoretical-empirical studies, with the goal of presenting a consolidation of the advances that have been gained.

    In particular, the present study focuses on the aspects of the relationship between CFP and CSP. For example, several studies have investigated which independent variables among those that typically serve as a proxy for CSP (customers, employees, suppliers, government, environment, diversity, and community) are neutral, positively, or negatively correlated with the variable CFP. However, once again, what is the synthesis of these results? Furthermore, several studies have specifically investigated which control variables could be employed in this relationship, e.g., stakeholder management (Berman, Wicks, Kotha, & Jones, 1999), company size (Orlitzky, 2001), industry (Waddock & Graves, 1997), and board composition (Shao, 2010). What is the set of control variables that have been tested and are potentially appropriate for this relationship?

    Some questions were designed to guide this research. In theoretical field, these questions were used to facilitate the responses to the following questions: Do the empirical results reinforce stakeholder theory? What potential inconsistency does stakeholder theory display compared to the observed empirical results? What advances in stakeholder theory may be supported by empirical evidence?

    In the area of empirical research, this study seeks to answer to the following questions: What are the most used variables to measure Financial Performance and Social Performance? How is the causal relationship between the two variables treated? What control variables are considered in this relationship? What are the most used statistical techniques? What are the sources and form of data collection employed? Has there been, in fact, an evolution in the volume of these publications?

    Notably, there is a series of theoretical and methodological gaps to be researched. From theoretical perspective, the main gaps are related to the variables that influence the CSP/CFP relationship and their causal and temporal relationship. From the methodological point of view, the main gaps are related to the most accepted forms of measuring CSP and CFP and to the main test methods employed.

    CHAPTER TWO

    2.0 Literature Review

    2.1 Introduction

    This chapter focuses on the review of related literature. A literature review includes the current knowledge as well as theoretical and methodological contributions to a particular topic. It documents the state of the art with respect to the topic you are writing. It surveys the literature in the topic selected. In this research work the literature review includes the …

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