Effect of Corporate Social Responsibility Disclosures on Financial Performance of Listed Consumer Goods Companies in Nigeria

Abstract

This study examined the effect of corporate social responsibility (CSR) disclosures on the financial performance of listed consumer goods companies in Nigeria. Social disclosure, economic responsibility disclosure and staff welfare disclosure served as the independent variables, while Return on Assets (ROA) was employed as a proxy for financial performance. Firm age, leverage and adjusted CSR ratio were incorporated as control variables. Adopting an ex-post facto research design, the study analysed panel data drawn from the annual reports and financial statements of 15 selected listed consumer goods companies for the period 2016–2025, yielding 150 firm-year observations. Data were analysed using descriptive statistics and multiple panel regression. The results show that social responsibility disclosure has an insignificant and positive relationship with financial performance (ROA), while economic responsibility and staff welfare responsibility disclosure both have insignificant and negative relationship with financial performance (ROA) respectively. However, adjusted corporate social responsibility ratio have a significant positive relationship with financial performance (ROA), leverage have significant negative relationship with financial performance (ROA), while firm age has an insignificant and negative relationship with financial performance (ROA). The study concludes that companies that prioritize economic responsibility and staff welfare responsibility are likely to experience reduced financial performance due to increased expenditure outlay. The study recommends among others that consumer goods companies’ policymakers and regulatory bodies in Nigeria should encourage listed companies to disclose their social responsibility initiatives more transparently.