CSR and Financial Performance – Linked by Innovative Activities

Majda Bastič, Matjaž Mulej, Mira Zore


The purpose of the present study was to investigate the relationships
between different dimensions of corporate social responsibility (CSR), as well
as the mediating role of innovation between CSR dimensions and financial
performance. Data was collected with questionnaires from 321 managers
of Slovene companies to test a conceptual model with structural equation
modeling (SEM). The field-research results were that CSR is the most relevant
dimension for employees. It positively influences CSR to the natural environment,
to customers, and to the local community. The mediating role of innovation
between CSR and financial performance was confirmed. The results also showed
that CSR to the natural environment and CSR to customers positively affect
innovation, while CSR to the local community had a negative impact. In addition,
the positive impact of innovation initiated by CSR on financial performance was
confirmed. The principal limitation of this study was its focus on Slovenian
firms and the fact that data was obtained from only one manager in each firm.
Slovene companies should consider the global initiatives supportive of CSR as
the way to create opportunities for innovation and differentiation from other
companies and increase their financial performance. The conceptual model
developed and tested on the data obtained by Slovene managers gives new
perspective on the impacts of social responsibility, innovation and financial
performance. It highlights the areas in which the theory of social responsibility
needs more research.


corporate social responsibility (CSR), Slovene companies, innovation, financial performance, structural equation modeling (SEM)

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