Economic Benefit of Corporate Social Responsibility : The Case of Korean Corporations

This study investigates accrual of economic benefit to corporates from CSR (corporate social responsibility) activities, specific to the case of Korean corporates. This study uses publicly available data of KEJI index for the corporates’ CSR performance and FnGuide’s financial data for their financial performance (FP). The data specimen for this study comes from historical data of 405 Korean companies from 2004 to 2016, listed as the top 200 CSR companies. This study fills known gaps in the current literature with new empirical data and analysis. The study further contributes by introducing a new variable - environmental CSR - and examining its relationship to corporate FP. The results validate stakeholder theory and suggest economic benefits accrue to Korean corporates from their CSR activities, through increased sales growth and exports, and reduced debt cost. The analysis result provides evidence for companies to strategically enhance their CSR activities.