The impact of corporate social responsibility on firm performance: the case of in Vietnamese companies

Abstract

This study attempts to identify the determinants of Corporate Social Responsibility (CSR) and to examine the impacts of CSR on firm’s financial performance of 6435 Vietnamese firms extracted from the combination of the Vietnam Technology and Competitiveness Survey (TCS) and the Vietnam Enterprise Survey (VES) within a three year period from 2010 to 2012. By applying the panel data and Fixed Effects Model, the empirical results suggest that CSR may have positive relationships with firm performance whereas the determinants of CSR include firm size, R&D participation, final goods ratio and ownership structures. These results are supported by a majority of empirical papers about CSR (Erhemjamts et al., 2012; Margolis et al., 2007; Russo and Fouts, 1997) and theories about CSR such as stakeholder theory, resource-based view and stewardship theory. In addition, the study also reveals the situation of CSR in Vietnam: although a large number of Vietnamese firms are already aware of CSR, most of firms only participate in Labor CSR, which is mandatory by laws while Community-related CSR is generally ignored. Based on the findings, the thesis may propose several policy recommendations to improve the CSR practice in Vietnam.