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Nexus between Corporate Social Responsibility, Innovation, and Firm Financial Performance of the Manufacturing Companies in Sri Lanka

K. P. Madhushanka & D. L. M. N. K. Ariyasena

International Journal of Accounting and Business Finance2025https://doi.org/10.4038/ijabf.v11i2.188article
ABDC C
Weight
0.50

What the paper says

This study aims to examine the relationship between corporate social responsibility (CSR), innovation, and financial performance (FP) of manufacturing companies in Sri Lanka. A questionnaire survey served as the primary data source for the content analysis. One hundred manufacturing companies, out of 284 registered companies on the Colombo Stock Exchange (CSE), were used as the population, from which 70 were sampled using simple random sampling. In this study, CSR and innovation are independent variables, FP is the dependent variable, and company age and size are control variables. CSR is constructed by Employee Relevant CSR (EMP), Customer Relevant CSR (CUS), Community-Related CSR (COM), and Environment-Relevant CSR (ENV). The data analysis revealed a significant positive relationship between CSR, innovation, and FP. However, the study results found that CSR has a significant positive effect on FP. Besides, the results confirm that CSR practices and innovations are beneficial for companies to adopt, as they help increase the FP. The results argued that for stakeholders who wish to achieve the best FP through improved CSR practices and Innovation in Sri Lanka's dynamic manufacturing industry, allocating budgets for EMP improvement has a significant impact, leading to real FP improvements in manufacturing companies, and emphasize that manufacturing companies should embrace innovation in line with organizational needs.

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https://doi.org/https://doi.org/10.4038/ijabf.v11i2.188

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@article{k.2025,
  title        = {{Nexus between Corporate Social Responsibility, Innovation, and Firm Financial Performance of the Manufacturing Companies in Sri Lanka}},
  author       = {K. P. Madhushanka & D. L. M. N. K. Ariyasena},
  journal      = {International Journal of Accounting and Business Finance},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.4038/ijabf.v11i2.188},
}

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.