The chicken and the egg revisited: Ties between corporate social performance and the financial bottom line

Abstract

Executive Overview The article focuses on the link between corporate social performance (CSP) and financial bottom lines. It examines a study utilizing social performance data gathered by an independent research firm rating companies in the Standard & Poor 500 Index that rated eight CSP attributes: employee relations, product characterstics, military contracting, involvement in South Africa, community relations, environmental performance records, workforce diversity, and nuclear power involvement. It mentions that the study analyzed the relationship between CSP and the financial performance of over 400 businesses from 1989 to 1990, measuring return on assets, return on equity, and return on sales. It says the study concluded that CSP is influenced by financial success and that CSP improves corporate profits.