The corporate social responsibility challenge on financial performance: Portuguese business situation

According to the definition that the European Commission (2001) offered us, corporate social responsibility is a set of measures that an organization can adapt, to improve the well-being of its stakeholders and promote the balance of economic, social, and environmental performance. The stakeholder theory clarifies that this decision-making must take into consideration all groups of people, being the only way of having a proportional benefit. Based on this premise, in this study, we intend to unravel the main determinants of corporate social responsibility in 63 Portuguese companies. To accomplish that, we used panel data, withdrawn from the SABI database, in the period comprehended between 2008 and 2018, applying the Probit model and the dynamic GMM for robustness check. The sample is composed of 42 companies that find themselves listed in the Portuguese stock exchange and 21 that do not. We can verify that the outcomes allow the analyses of nine variables, among them, only the audit, the asset rotation ratio, the debt ratio, the size, age, and financial autonomy show themselves as statistically positive in the implementation of corporate social responsibility practices. Even though the outcomes were not what we initially predicted, they revealed the positive impact of such practices. We consider them necessary and a reality that companies should pursue, even for the gains of capital that it might represent. We firmly believe that being socially responsible constitutes an essential practice from which all of us can benefit, contributing to life improvement in the community and for environmental sustainability.