Corporate Social Responsibility and Bank Performance in Transition Countries

Abstract

This paper studies the relationship between corporate social responsibility and bank performance for 16 transition countries of the former Soviet Union and Central and Eastern Europe. The aim is to investigate (1) the nature of the link between corporate social responsibility and bank performance and the motive of banks to engage in corporate social responsibility (2) whether this is different during stable (2002-2005) and turbulent (2008-2012) periods. The results of the structural equation model using the data for 254 banks show that corporate social responsibility positively impacts on bank performance in both periods and implies that the strategic choice is the main motive of the banks to engage in corporate social responsibility for the countries investigated in the paper.