This paper attempts to prove that strategically investing in corporate social responsibility (CSR) will maximize profits while satisfying the demands from multiple stakeholders.
The paper adopts a quantitative analysis and exploratory approach. It studies the CSR practices of 20 selected UK companies. The analysis of CSR policies is based on the global reporting initiative (GRI) guidelines. The analysis took a further step in examining the trends of earnings per share (EPS) of the selected companies.
The findings revealed that out of the 20 selected companies, only four achieved all six guidelines as per the GRI. In regression analysis of the variables CSR and EPS, a very weak (causal) but positive relationship was evident (R2=0.147).
The study was applied to 20 selected companies in the UK. Future research should be extended to a larger sample in order to analyze the strength of the relationship between EPS and CSR. The study applied variables of CSR based on GRI. Other measures may reveal different insights.
In the strategic sense, CSR investments are not just another business cost but are essential for a firm's continued survival in the ever increasingly competitive business world of today. This understanding is crucial as there is an escalation of concern by both society and corporations in the modern world. More so, it is increasingly and widely accepted that attempting to isolate business from society is unrealistic and that dichotomising economic and social objectives as distinct and competing is false.
The paper applies the variable EPS and seeks to establish a relationship with the CSR as measured according to the GRI.
