Csr And Corporate Governance Study
Abstract
The aim of the study is to check the relationship between corporate social responsibility (CSR) and the corporate governance (CG) of the company. A company considers its accountability, transparency, credibility through corporate governance. Performance of the company depend on corporate governance. A company also follows the business code of conduct (ethics), are the moral values which company needs to follow to maintain the discipline. This study tells the relationship between CSR and CG and measure how company is performing? To check the performance of variables includes ROA, ROE and Price to book value whereas the variables used to measure the Corporate Governance through size, independence and duality of the BOD. The main variable
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Company is act as artificial person and have a legal entity. Company can be of any type, it can be Sole, partnership, joint, etc. Each company have different characteristics. Every company requires some rules and regulations to manage the operations.
Governance
Governance is basically defining rules, compliance procedures, regulations, methods, control and authority that every company needs to manage everything that is happens in the company. Company needs structure to run the long-term business. Corporate governance affects the business internally and externally.
Corporate governance is the mechanism that company follows and reduce the agency conflict. Agency conflict is the conflict between principal and agent. Due to their own interests. Agents always used to eat the large piece of cake because they always enjoy the perks and the profits or benefits. Whereas the principal used to invest in the business and they enjoy the dividend amount at the end of the year and they are the owner of the company.
• A company who strongly focuses on the corporate governance will face less risk.
• Corporate governance helps in improving the position of the
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Economic responsibilities
2. Legal responsibilities
3. Ethical responsibilities
4. Philanthropic responsibilities
These responsibilities relate to each other. Every company who must have the same goal to maximize the profits. Every company must follow the ethical terms and conditions to protect the society. Society plays an important role to run the business successfully.
The CSR and CG both are different. Our study has an aim to check the relationship between CG and CSR and how they affect the performance of the company. Because both have different purposes. First the CG has an aim to protect the shareholders interest while CSR has an aim to protect the external stakeholders. External stakeholders include (society, environment, public, government, community, suppliers, customers etc.)
Corporate governance base on the structure which is usually reduce the conflict between agent and the principal who are the main part of the company.
Independent Variable
• Firm performance
A company has an aim to maximize its wealth or profit. Company can measure its performance by return on assets, return on equity and price to book
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