Impact of CSR on Financial Position of Pakistan Tobacco Company Akora Khattak

Abstract

To measure the impact of CSR on the company’s financial position seems to be a great challenge. Nowadays the companies’ investment in Corporate Social Responsibility activities have grown significantly, and it has become a strategy for value creation. Difficulties in measuring the relationship between the CSR and financial position of the company are to some extent explained by the varying definition of CSR. There are strong proponents and opponents to companies which are involved in CSR activities despite the expensive research on the subject. There are different schools of thoughts regarding the impact of CSR on financial position of the company. Some school of thoughts show a negative view towards the impact of CSR on firm’s position, they are of the view that the companies using its resources in CSR programs do not add value to the company’s financial position, instead of using resources in CSR programs the company should use these resources for value adding activities for shareholders only. The other school of thoughts shows a positive attitude towards the CSR engagement. They are of the view that the companies are obliged and have the obligations regarding all stakeholders and they must be socially responsible.