CORPORATE SOCIAL PERFORMANCE VERSUS FINANCIAL PERFORMANCE OF THE ROMANIAN FIRMS

This article analyses the relationship between corporate social performance and financial performance at the level of a panel of 62 Romanian companies listed on the Bucharest Stock Exchange. The first challenge was measuring of the social performance. A new social performance measurement system was developed based on which the CSP Index was obtained.The GRI criteria for reporting, the channel of communication chosen by the companies, as well as the level of detail of the published information were taken into account. The estimation of the regression model was made using the CSP Index as the dependent variable and the financial indicators (return on assets, return on equity, sales growth, average number of employees, total sales, market value added, PER index) as the independent variables.The panel regression analysis done to highlight the fixed or random effects at the company level indicated a relatively weak causal relationship between corporate social performance and financial performance. The social performance may also depend on other variables that are not included in the model, although, the general conclusion was that the social performance of Romanian companies is relatively low, but in an ascending evolution.