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Effect Of Corporate Social Responsibility On Profitability Of Listed Deposit Money Banks In Nigeria
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CHAPTER THREE METHODOLOGY
3.1 Introduction
This chapter addresses methodological issues which include research design, population and sample size; sources and methods of data collection; techniques of data analysis and definition and measurement of variables. It also consists of diagnostics and post estimation tests. This study adopts a longitudinal panel research design and uses panel data (cross sectional and time series data) to analyze the effects of CSR on the profitability of listed deposit money banks in Nigeria. This type of research design seeks to establish causal relationship between the dependent and independent variables (Robson, 2002; Nelling & Webb, 2009 and Saunders, Lewis & Thornhill, 2009). According to Kerlinger and Lee (2000), this research design is appropriate where the study is attempting to explain how the phenomenon operates by identifying the underlying factors that produce change in it in which case there is no manipulation of the independent variables.
3.2 Population and Sample Size of the Study
The population of the study is 15 deposit money banks listed on the floor of the Nigerian Stock Exchange. Ecobank Transnational Incorp is excluded from the sample having been listed on 24th April, 2006 (meaning that the data for 2006 is not for full year), therefore the sample size is reduced to 14 deposit money banks listed and had full accounts for period 1st January, 2006 through to 31st December, 2015 as shown in
3.3 Model SpecificationThe general equation/model of the study is:
Profitabilityi,t = α + CSRi,t + εi,t (1)
Although, the study is examining how CSR influences on profitability, there are other factors that can influence profitability which require to be controlled for in the estimations. On the basis of earlier studies, this study considers size (SIZE), leverage (LEV) and interest rate (INTR) as control variables for firm size, financial leverage and interest rate, respectively. Thus, equation 1 is expanded as follows:
NPMi,t = α + β1CSRi,t + β2SIZEi,t + β3LEVi,t + β4INTRi,t + ε (2)
ROTAi,t = α + β1CSRi,t + β2SIZEi,t + β3LEVi,t + β4INTRi,t + ε (3)
ROEi,t = α + β1CSRi,t + β2SIZEi,t + β3LEVi,t + β4INTRi,t + ε (4)
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ABSRACT - [ Total Page(s): 1 ]ABSTRACTAlthough an enormous body of literature has emerged concerning the nexus between corporate social responsibility and profitability, actual empirical research designed to test the multitude of definitions, propositions, concepts and theories that have been advanced has produced mix results. In addition, much of the research done in the area has been incomplete and simplistic in methodology and epistemology. Many of the methodological quagmires in studying the nexus between corporate socia ... Continue reading---
APPENDIX A - [ Total Page(s): 2 ]APPENDIX A STUDY DATA SET ... Continue reading---
APPENDIX B - [ Total Page(s): 4 ]APPENDIX B4 REGRESSION COEFFICIENTS ... Continue reading---
LIST OF TABLES - [ Total Page(s): 1 ]LIST OF TABLESPageTable 1 List of quoted Deposit Money Banks in Nigeria Table 2 Descriptive Statistics Table 3 Variance Inflator Factor Table 4 New Variance Inflator Factor Table 5 Durbin-Watson Statistics Table 6 Heteroskedasticity Test for NPM Model Table 7 Stationarity Test Table 8 Hausman Specification Test Table 9 Shapiro-Wilk W Test for normal data Table 10 Granger causality test Table 11 Linear Regression of NPM Random ... Continue reading---
LIST OF FIGURES - [ Total Page(s): 1 ]LIST OF FIGURESPageFigure 1 Link between Corporate Social Responsibility and Profitability ... Continue reading---
TABLE OF CONTENTS - [ Total Page(s): 1 ] TABLE OF CONTENTS Title page PageDeclaration Certification Approval page Dedication Acknowledgements Table of Contents List of Tables List of Figures List of Appendices Abstract CHAPTER ONE: INTRODUCTION1.1 Background to the Study 1.2 Statement of the Problem 1.3 Statement of Research Questions 1.4 Objecti ... Continue reading---
List of Appendixes - [ Total Page(s): 1 ]LIST OF APPENDICESPageAppendix A: Study Data Set Appendix B1: Descriptive Statistics Appendix B2: Diagnostic Tests Results Appendix B3: ANOVA Results Appendix B4: Regression Coefficients ... Continue reading---
CHAPTER ONE - [ Total Page(s): 5 ]Profitability is the final measure of economic success achieved by a firm in relation to the capital invested in it. This economic success is determined by the magnitude of the net profit (Pimentel, Braga & Casa Nova, 2015). To achieve an appropriate return over the amount of risk accepted by the shareholders, is the main objective of firms operating in capitalist economies. After all, profit is the propulsive element of any investments in different projects. The assessment of profitability is u ... Continue reading---
CHAPTER TWO - [ Total Page(s): 8 ]CHAPTER TWO LITERATURE REVIEW2.1 IntroductionIn this chapter, a review of the extant literature on the subject matter is carried out covering conceptual framework, theoretical literature, and empirical literature.2.2 Conceptual Framework2.2.1 Corporate Social ResponsibilityA key indicator to determine the true worth and value of modern organizations is their ability to give back to the society part of their income through some mutually beneficial initiatives otherwise often ref ... Continue reading---
CHAPTER FOUR - [ Total Page(s): 9 ]4.4.3 Effect of CSR on ROEThe effect of corporate social responsibility on profitability measured by return on equity (ROE) is shown Table 13 as follows:R2 = 0.908 Adjusted R2 = 0.906F-Statistics = 445.340 Prob > F = 0.000 Source: IBM SPSS 22 Outputs based on study dataAs shown in Table 13, results on the effect of CSR on ROE show that the coefficient of CSR was 0.009 hence CSR had a positive effect on ROE. It also suggests that for every unit increase in CSR, profitability inc ... Continue reading---
CHAPTER FIVE - [ Total Page(s): 1 ]CHAPTER FIVESUMMARY, CONCLUSION AND RECOMMENDATIONS5.1 SummaryThe overall objective was to study the effect of corporate social responsibility on profitability of listed deposit money banks in Nigeria. The findings indeed supported the overall relationship with an explanation of 72.25 per cent with regard to NPM and 95 per cent with regard to ROTA and 91% with regard to ROE. NPM, ROTA and ROE models were found to be significant at 5% level of significance too. The study employed both causa ... Continue reading---
REFRENCES - [ Total Page(s): 2 ]REFERENCESAbbasi, A., & Malik, Q. A. (2015). Firms‘ size moderating financial performance in growing firms: An empirical evidence from Pakistan. International Journal of Economics and Financial Issues, 5(2), 334-339.Abdul-Hamid, F. Z. (2004). Corporate social disclosures of banks and finance companies: Malaysian evidence. Corporate Ownership and Control, 1(4), 118- 129.Abdulrahman, S. (2013). The influence of corporate social responsibility on profit after tax of some selected deposit mone ... Continue reading---
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ABSRACT - [ Total Page(s): 1 ]ABSTRACTAlthough an enormous body of literature has emerged concerning the nexus between corporate social responsibility and profitability, actual empirical research designed to test the multitude of definitions, propositions, concepts and theories that have been advanced has produced mix results. In addition, much of the research done in the area has been incomplete and simplistic in methodology and epistemology. Many of the methodological quagmires in studying the nexus between corporate socia ... Continue reading---