Global Journal of Management and Business Research, A: Administration and Management, Volume 23 Issue 5

Financial Performance Figure 1: Conceptual Framework on the Link between Employee Dimension of CSR and FP Source: Researcher’s Conceptualization (2022) Employee dimension of Corporate Social Responsibility Controlvariables Effect of Employee Dimension of Corporate Social Responsibility on Financial Performance of Listed Consumer Goods Companies in Nigeria 3 Global Journal of Management and Business Research Volume XXIII Issue V Version I Year 2023 ( ) A © 2023 Global Journals long-term career prospects and development of employees, taking measures to prevent any discrimination in employment to promote the participation of employees in management and their contributions to critical decisions, bearing in mind the issues of improved health, security and welfare of employees. A company’s CSR efforts for employees entail providing safeworking conditions, training employees, and having concerns for the general welfare concern for employees. iii. Control Variables From the literature review, control variables are variables used in research to isolate their effect from the independent and dependent variables relationship. Most researchers in the literature have controlled in their CSR methodology, Research, and Development (R and D), Industry type, Company size, age, and leverage. iv. Financial Performance Financial performance (FP) measures how well a company has used assets from its primary mode of business to generate revenue. Cochran and Wood (1984), as cited by Boaventura, Da Silva and, De-Mello (2012), noted that the definition of FP is not debated in the literature, but that there is disagreement concerning the best way to measure FP such as market-based measures (Share Price, Price to Earnings Ratio, Market Share, Dividend Payout Ratio) and accounting based measures (Return on Assets, Return on Equity, Earnings per Share, Return on Investment). Boaventura, Da Silva and, De-Mello, (2012) observed that return on assets (ROA) is rated highest in the frequency of use in empirical research to measure FP. Many strategies and diversities in workforce combination must be harnessed to enhance and sustain financial performance for the well-being of a corporation. Financial performance might be affected by corporate responsibility (CR) to employee. The conceptual framework diagram is contained in Figure 1. The employee dimension of Corporate Social Responsibility is the independent variable. The company’s efforts toward employees by providing safe working conditions, training employees and, the general welfare concern of employees might enhance the commitment level of employees, resulting in to increase in the rate of retention of employees. An increase in the commitment level of employees would result in operational effectiveness of employees, which could lead to good quality products. Moreover, an increase retention level means a reduction in the cost of recruitment of new employees. These are hypothesized to have an effect on financial performance. Employee dimension of Corporate Social Responsibility is the independent variable in Figure 1. Financial performance is the dependent variable, which is hypothesized to be explained by CSR to employees as indicated in the Figure 1. b) Theoretical Framework Although several different theories have been used to explain the association between corporate social responsibility (CSR) and financial performance (FP), Suttipun and Stanton (2012) noted that the most embracing theoretical perspective in the environmental accounting literature, which explains corporate motivations for reporting, is based on Legitimacy and Stakeholder theories. Tilling, (n. d) stated that Legitimacy Theory has become one of the most cited theories within the social and environmental accounting area. However, there remains deep skepticism among