Corporate Social Responsibility and its Impact on the Profitability of select Private, Public and Multi-National Companies in India: An Empirical Study

Abstract

Corporate Social Responsibility is companies concern towards society. Survival is the fittest, the basic principle the companies should follow to stay in the corporate world. If the company spends some percentage out of the profit earned towards the betterment of the society directly or indirectly then there is a chance that society will in return support the growth of the company. Companies are serving society through the medium of corporate social responsibility and it is seen that Corporate Social Responsibility has always been taken care of by the companies in India after the Companies Act 2013. Companies have to spend 2% out of the average profit of the preceding three years earned towards Corporate Social Responsibility. In this paper an attempt has been made to assess the performance of Corporate Social Responsibility of select companies (ownership wise) in India and studied the impact of Corporate Social Responsibility of the companies on their profitability. The average actual % expenditure on CSR of current year profit does not differ significantly between three types of ownerships (i.e. private, public and MNC) for all financial years CSR Expenditure, Private Company and Public Ownership plays an important role in increasing the Net Profit of the company.