EFFECT OF CORPORATE SOCIAL RESPONSIBILITY (CSR) ON THE PROFITABILITY OF DEPOSIT MONEY BANKS (Dmbs) IN NIGERIA

This study examined the effects of corporate social responsibility on the profitability of deposit money banks in Nigeria.Specifically, the study focused on the effects of employee training cost, environmental cost, community development cost and donation on the profitability of deposit money banks in Nigeria.The study adopted expo-facto research design.The data set for this study were mainly secondary data, sourced from the published financial reports of the sampled deposit money banks and this stems from the interest of the researcher to cover the period of the global financial and economic crises and the period of domestic economic recession that affected every sector of the economy.The data comprised annual time series spanning from 2013 through 2022.The research employs only quantitative method of data analysis.Considering the outcome variable that is dichotomous, panel data regression analysis which includes fixed effect estimation and random effect estimation was considered appropriate to test the formulated hypotheses.Before the hypotheses were tested, it was discovered that employee training cost has a negative but significant effect on the profitability measured with return on asset of deposit money banks in Nigeria to the tune of -35.10018 (p=0.045<0.05).Also, it was revealed that environmental cost has a positive but insignificant effect on the return on asset of deposit money banks in Nigeria to the tune of 1.634773(p=0.924>0.05).Furthermore, it was revealed that community development cost had a negative insignificant effect on the performance measured with return on asset of deposit money banks in Nigeria to the tune of -12.90311(p=0.347>0.05).Finally, donation had a negative but significant effect on profitability of deposit money banks in Nigeria to the tune of -12.00056(p=0.000<0.05).Based on the reported findings, it was established that there is a statistically significant effect of corporate social responsibility on profitability of deposit money banks in Nigeria.Hence, it was recommended that management of deposit money banks should ensure compliance with the guidelines of environment cost reporting as this portrays good image of their firms.