Abstract:
The purpose of this study was to determine the effects of corporate social
responsibility disclosure on the organizations financial performance. Specifically, the
study examined the effect of environmental disclosure, community disclosure,
employee disclosure and financial performance of quoted manufacturing companies
in Kenya. The study was anchored on stakeholders theory, legitimacy theory and
stewardship theory. The study employed census research design. The target
population was all the manufacturing firms that are listed in the NSE from 2007 to
2017. The researcher identified manufacturing firms because they impact heavily on
environment through waste and pollution they discharge and in addition they are
capital and labour intensive organizations. This study used secondary data and content
analysis of data from the published financial records and analysis of other reports of
the companies. Stata version 12 was used to analyze the data using both descriptive
and inferential methods. The findings were presented in form of tables and figures. It
was expected that the study findings help business owners and managers to make
more informed decisions on whether or not to adopt corporate social responsibility
disclosure. The study also expected to help investors to understand the relationship
between corporate social responsibility and financial performance which will help
them design and allocate their portfolio in a manner that maximizes returns by
investing in firms and organizations that make decisions based on ethical concerns.
Further, the study also expected to enrich the discussion on corporate social
responsibility and contribute to the existing literature and theories. The study found
positive and non-significant effect of environmental disclosure, community disclosure
and financial performance of quoted manufacturing companies in Kenya. Moreover,
employee disclosure had inverse and non-significant effect on financial performance
of quoted manufacturing companies in Kenya.
