Title: CSR and firm performance nexus in a highly unstable political context: institutional influence and community cohesion

Authors: Islam Abdeljawad; Mamunur Rashid; Nour Abdul-Rahman Arafat; Hadeel Naifeh; Nadeen Ghanem

Addresses: Finance and Banking Department, Faculty of Economics and Social Sciences, An-Najah National University, Nablus, Palestine ' Christ Church Business School, Canterbury Christ Church University, Canterbury, UK ' Accounting Department, Faculty of Economics and Social Sciences, An-Najah National University, Nablus, Palestine ' Accounting Department, Faculty of Economics and Social Sciences, An-Najah National University, Nablus, Palestine ' Accounting Department, Faculty of Economics and Social Sciences, An-Najah National University, Nablus, Palestine

Abstract: We provide evidence of the relationship between corporate social responsibility (CSR) and corporate financial performance (CFP) in Palestine, a highly unstable political context. Annual reports of all firms listed on the Palestine Exchange (PEX) for the period 2016-2019 were manually content analysed. A checklist of reported CSR items is summarised into four areas: environmental information, human resources, community involvement, and product and customer service quality. Results indicate a robust positive connection between each of the four dimensions and the composite CSR index with three performance indicators: ROA, ROE, and Tobin's Q. Results also find better performing companies with a higher degree of community involvement being greatly appealing, while the environmental dimension was the least resilient. We discuss the significance of community engagement for an unstable context like Palestine from a 'community cohesion' standpoint.

Keywords: corporate social responsibility; CSR; corporate financial performance; CFP; unstable economies; small economies; Palestine.

DOI: 10.1504/IJBGE.2024.141803

International Journal of Business Governance and Ethics, 2024 Vol.18 No.6, pp.678 - 701

Received: 03 Jul 2022
Accepted: 03 Feb 2023
Published online: 02 Oct 2024 *

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