CORPORATE SOCIAL RESPONSIBILITY COST AND FINANCIAL

Abstract

Despite the increasing militancy pressures and agitations, the oil and gas firms operating in Nigeria have remained adamant to the discharge of their corporate social responsibility, on the inimical pretence that it constitutes a drain on their financial position. This study investigate the relationship between corporate social responsibility cost and financial performance of quoted oil and gas companies in Nigeria from 2018-2023. Community development cost, and employee benefits cost were the proxies corporate social responsibility while net profit margin and return on investment were the proxies of financial performance. The researchers adopted expost- facto research design for the study. The study used secondary data obtained from the audited annual reports and accounts of the nine quoted oil and gas firms’ website and the Nigeria stock exchange fact book as at November 8, 2024. The research data was analyzed using basic descriptive, Pearson product moment correlation and multiple regression in a cross sectional data with the aid of SPSS version 27. The findings revealed that all the CSR proxies significantly related with net profit margin and return on investment of listed oil and gas firms in Nigeria in the period of this study. We thus concluded that corporate social responsibility has significant relationship with financial performance of quoted oil and gas firms in Nigeria in the period of this study. We recommended that Management of oil companies should develop a well-articulated corporate social responsibility and prioritize their spending regarding human resource development, community development, and environmental protection in order to guarantee a conflict free corporate atmosphere needed by managers and workers for maximum productivity and robust financial performance.