Impact of Corporate Social Responsibility on Financial Performance- Study with Reference to Sbi and Axis Banks in India

Abstract Purpose- Corporate social responsibility (CSR) has taken an increased attention and importance in recent years especially in India for companies’ act 2013 and its influence, as banking investors have given an increased priority to solve existing issues in their banking investment decision-making. The purpose of this paper is to empirically examine the impact of CSR on financial performance in terms of Net profit After Tax (NPA), Return on Assets (ROA), Return on Equity (ROE) and Earnings per Share (EPS). Design/methodology/approach –This research is basically a descriptive in nature .Using CSR index factors and financial factors for the two banks in India. Cross sectional models are employed to identify the CSR activities of Axis bank and SBI bank in India through CSR index. Financial performances were tested by using the variables Net profit After Tax (NPA), Return on Assets (ROA), Return on Equity (ROE) and Earnings per Share (EPS). Sample & Statistical tools techniques– In this study the sample of 4 year data from (2012-2016) of Axis and SBI have been taken. To find out the cause and effect relationship between CSR on financial performance of the banks correlation and Regression tools have employed. Findings – The empirical results shows that the mixed relationship between CSR and Financial performance of Banks in India. The cross sectional CSR index explained that the banks in India have increased the level of CSR activities year by year and it is a sign of good improvement. Key Words – Corporate Social Responsibility, financial performance banks, India, Net Profit After Tax (NPAT), Earnings Per Share (EPS), Return on Equity(ROE), Return on Assets (ROA)