Corporate Financial Profitability In The Fmcg Industry

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CHAPTER 1: INTRODUCTION

1.1 BACKGROUND

The field of corporate social responsibility, CSR thereafter, has grown exponentially in the last decade. More so with fast moving consumer goods, FMCG thereafter, which include companies such as Unilever, P&G, Reckitt Benckiser and Nestle. These companies have engaged in serious efforts to define and integrate CSR into all aspects of their businesses. There is increasing demand for transparency and growing expectations that corporations measure, report, and continuously improve in their social, environmental and economic performance (Palmer, 2012)

Over the years, CSR has been given many definitions. It has been described as, the responsibility of organisations to take account for their environment …show more content…

This will be achieved through employing a mixture of accounting and market based measures to identify the nature of the relationship between CSR and CFP in the given …show more content…

This study attempts to provide information on the impact of CSR on financial performance which internal stakeholders can use to structure business strategies and maximize future returns. If firms are interested in investing in social responsibility initiatives, this study predicts how their organizations will be impacted financially and describes strategies managers can employ to satisfy their constituents (Nkomani, 2013). In general, this paper seeks to analyse the relationship between CSR and profitability in the FMCG industry over time, to determine whether CSR causes a positive or negative effect on profitability on specific FMCG companies operating in the Republic of South Africa.
The study specifically seeks to:

• Investigate the overall impact of CSR on profitability in FMCG companies.
• Investigate whether it has had a positive or negative co-relation between CSR and Profitability over years.
• Investigate whether increased ratings by these organisations on CSR initiatives over the years have led to an increase in profits.

1.5 IMPORTANCE AND BENEFITS OF THE

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