Caribbean Journal of Science ISSN: 0008-6452

Investors Perception on Corporate Social Responsibility: Investment Decision in Stock

Market
Felix Subin Thomas.B
Research Scholar,Department of Management Studies
Anna University Regional Campus Tirunelveli,
Tamil Nadu, India
subinthomasmba@gmail.com

Dr. A.Velanganni Joseph

Professor, Department of Youth Welfare Studies
Madurai Kamaraj University
Tamil Nadu, India
dravjoseph@rediffmail.com

Dr.S. Silas Sargunam

Assistant Professor, Department of Management Studies
Anna University Regional Campus Tirunelveli,
Tamil Nadu, India
silassargunam@yahoo.com

Abstract
Investors are socially responsible and they take in to account of factors related to environment, society and corporate
governance while they make investment decision. Investment decision usually depends on maximization of wealth
and is influenced by personal, ethical values and Corporate Social Responsibility of companies. The study explores
the perception of investors on Corporate Social Responsibility and the relationship between perception on CSR and
investment decision in stock market was investigated and reported. Perceptual difference across groups, relationship
between perception on CSR and investment decision were analyzed using the structured questionnaire response
collected from 300 random investors selected from Tamil Nadu state, India. Perception of investors proved that the
companies taking initiatives for protecting natural environment, for being socially responsible for betterment of
community. Maximum numbers of investors are in moderate level of perception on CSR. Significant difference
identified using T-value between genders. Significant difference identified using F-value between categories age,
education, occupation, monthly income and annual investment. Positive relationship explored between the perception
of investors on CSR and their investment decision in stock market. It was identified suitable existing reviews for
managerial implications reported.
Key Words: Corporate Social Responsibility, Investment Decision, Investor, Perception.

1. Introduction
Socially Responsible Investments have emerged as a significant one among the investors worldwide. SRI plays a
major role for decision making by considering the social, ethical and environmental importance [1]. As per the
presidents report to the stock holders, CSR becomes popular among the investors [2]. Recent argument between
business people and scholars is held in which they argued that the companies have a duty to maximize the wealth of
share holders. The argument continued that, because of these narrow focus, the companies may fail to take care of
other important stake holders including employees, suppliers, customers, and society and hence the interest on the

[1]Luc Renneboog , Jenke Ter Horst , Chendi Zhang b,(2008). Socially responsible investments: Institutional aspects,
performance, and investor behaviour. Journal of Banking & Finance 32 1723–1742

[2] Waymond Rodgers, Hiu Lam Choy, Andres Guiral,(2013). Do Investors Value a Firm’s Commitment to Social
Activities?.J Bus Ethics 114:607-623

Volume 53, ISSUE 2 (MAY - AUG), 2019 2581

Caribbean Journal of Science ISSN: 0008-6452

companies of stakeholders may affect which may reduce the value of companies and money flow[3,4,5,6,7,8,9,10]. The
argument came to be concluded by considering the social responsible which may improve the companies’ money flow
and hence the share holders’ interest on company may increase. Social responsibility may differentiate the products of
the company in the market [11,12] which may reduce the companies’ liability to risk [13].
Mismanagement of environmental and social problems is highly risky for sustainable development and stability of
companies [14]. CSR is the practice where by companies deliberately include environment and social development in
their different production and operational activities [15]. And also integration of environmental and social issues by
companies in to their operations and relation with stakeholders voluntarily [16]. Also consists of provision of gains in
business activities on the basis of environmental and social requirements of business atmosphere. CSR strategies and
business activities of companies are interrelated [17]. All the stakeholders insist the companies to adopt CSR for the
dealing of mounting responsibilities [18]. Thus, nowadays companies are concentrating on institutional arrangements
and value transformation for the improvement of society and using considerable resources for their commitment
towards CSR [19]. Recent reports show that, investors are the socially responsible persons and for investment decision,
the investors have to consider the factors that are related to environment, society and corporate governance [20].
Reference [21] reported that investment decision usually depends on maximization of wealth and are affecting by

[3]Swanson, D. L. 1999. Toward an integrative theory for business and society: A research strategy for corporate
social performance. Academy of Management Review, 24: 506-521.
[4] Whetten, D. A., Rands, G., & Godfrey, P. C. 2001. What are the responsibilities of business to society? In A.
Pettigrew, H. Thomas, & R. Whittington (Eds.), Handbook of strategy and management: 373-410. London: Sage.
[5] Clarkson, M. B. E. 1995. A stakeholder framework for analyzing and evaluating corporate social performance.
Academy of Management Review, 20: 92-117.
[6] Donaldson, T., & Preston, L. 1995. The stakeholder theory of the corporation: Concepts, evidence, and
implications. Academy of Management Review, 20: 65-91.
[7] Freeman, R. 1984. Strategic management: A stakeholder per spective. Englewood Cliffs, NJ: Prentice-Hall.
[8] Mitchell, R., Agle, B., & Wood, D. 1997. Toward a theory of stakeholder identification and salience: Defining the
principle of who and what really counts. Academy of Management Review, 22: 853-886.
[9] Paine, L. S. 2002. Value shift. New York: McGraw-Hill.
[10] Wood, D. J., & Jones, R. E. 1995. Stakeholder mismatching: A theoretical problem in empirical research on
corporate social performance. International Journal of Organizational Analysis, 3: 229-267.
[11] McWilliams, A., & Siegel, D. 2001. Corporate social respon sibility: A theory of the firm perspective. Academy
of Management Review, 26: 117-127.
[12] Waddock, S. A. & Graves ,S. B. 1997. The corporate social performance-financial performance link. Strategic
Management Journal, 18: 303-319.
[13] Godfrey, P. C. 2004. The relationship between corporate phi lanthropy and shareholder wealth: A risk
management perspective. Academy of Management Review, 30: 777 798.
[14]Lovins, A., Lovins, L.H., & Hawken,P.(1999). A Road map for Natural Capitalism. Harvard Business Review,
145-158.
[15] Marrewijk. (2003). Concept and definitions of CSR and corporate sustainability: between agency and communion.
Journal of Business Ethics, 44(1), 95-105.
[16] Mutch, N., & Aitken, R. (2009). Being fair and being seen to be fair: Corporate reputation and CSR partnerships.
Australasian Marketing Journal, 17(2), 92-98.
[17] Porter, & Kramer. (2002). The competitive advantage of corporate philanthropy. Harvard Business Review, 186-
192.
[18] Kumar, R., Murphy, D. F., & Balsari, V. (2001). Altered images: The 2001 state of corporate responsibility in
India poll. Understanding and encouraging corporate responsibility in south Asia – Update 1. Tata Energy Research
Institute, New Delhi.
[19] Swaen, V., & Chumpitaz, R. (2008). Impact of corporate social responsibility on consumer trust. Recherche et
Applications en Marketing, 23(4), 7-33.
[20] Pasewark, W. R., & Riley, M. E. (2010). It’s a matter of principle: The role of personal values in investment
decisions. Journal of Business Ethics, 93, 237-253.
[21] Beal, D. J., Goyen, M., & Phillips, P. (2005). Why do we invest ethically?. Journal of Investing, 14(3), 66-78.

Volume 53, ISSUE 2 (MAY - AUG), 2019 2582

Caribbean Journal of Science ISSN: 0008-6452

personal and ethical values. CSR of companies is also important for investors to make investment decision [ 22]. The
advantage of implementing the CSR is the companies can enhance the profit of stakeholder’s relationships without
affecting the shareholders by which, the marketability of the company increase. Hence, an effort has been made to
study the perception of investors on CSR and its relation with their investment decision in stock market by
considering the investors gender, age, educational qualification, occupation, monthly income and annual investment.
A detailed report has been prepared based on the analysis made by t-test, F-test and mean standard deviation and
reported.

1.2. Review of literature

Investors decide the investment based on CSR of companies and women investors’ responses to CSR is higher as
compared to men investors and young investors highly consider CSR in making investment decision[23].
Reference[24]shows that share holders had positive reactions to environment friendly initiatives of companies and
harmful actions of companies had negative impact of share holders on perception of companies and it affected their
investments. Companies had environmental, legal, economic, ethical and philanthropic responsibilities and these
dimensions were driving forces to adopt CSR and respondents had moderate level of perception on CSR of companies
[25].CSR had positive and significant impact on financial performance of corporations and it was positively and
significantly influencing the decision of investors [26]. Elements of CSR were highly and directly associated with stake
holders and CSR positively related with investment decision and efficiency of investors [27].significant and positive
relation exit among CSR and profit of companies and also investment decision of investors [28]. Reference [29]
revealed that investors were supporting CSR of firms and they make investment decision on the basis of level of CSR
practices followed by those firms.

1.3 Theoretical and conceptual background

The investors internalize the choices and types of investment in various shares of companies. They plan accordingly
with respect to the social responsibility initiatives of companies out of which the community, societies and
environment benefited to the betterment or well being. The internalization among the investors happening due to the
external stimuli or forces which attracts the investors those are socially responsible. The externalists assert that the
mind is more or less a blank sheet of paper and all knowledge is being imprinted in us from external reality. Both
external factors and internalization creates constructive perception among the investors to invest their money in
socially responsible companies [30]. Constructivist theories assume that the process of perception is a highly active
process of extracting sensory stimuli, their evaluation, interpretation and backward organization of sensory stimulus.
Perception is the end product of the interaction between stimulus and internal hypotheses, expectations and
knowledge of the observer, while motivation and emotions play an important role in this process. Perception is thus

[22] Hofmann, E., Hoelzl, E., & Kirchler, E. (2008). A comparison of models describing the impact of moral decision
making on investment decisions. Journal of Business Ethics, 82(1), 171-187.
[23]Leda Nath, Lori Holder-Webb, & Jeffrey Cohen.(2012). Will women lead the way? Differences in demand for
corporate social responsibility information for investment decisions. Journal of Business Ethics, 118(1), 85-102.
[24] Caroline Flammer.(2013). Corporate social responsibility and shareholder reaction: The environmental awareness
of investors. Academy of Management Journal, 56(3), 758-781.
[25] Ojenike J. O., Odunsi, A.O., & Atunbi J.A.(2014). Perception of corporate social responsibility in Nigeria: An
empirical investigation. International Journal of Business and Management Invention, 3(9), 69-73.
[26] Chin-Shien Lin, Ruei-Yuan Chang, & Van Thac Dang.(2015). An integrated model to explain how corporate
social responsibility affects corporate financial performance. Sustainability, 7, 8292-8311.
[27] Mohammed Benlemlih, & Mohammad Bitar.(2016). Corporate social responsibility and investment efficiency.
Journal of Business Ethics, 122(2), 1-24.
[28] Okere Wisdom, Imeokparia Lwarence, Ogunlowore John Akindele, & Isiaka Muideen.(2017). Corporate Social
Responsibility and Investment Decision in Listed Manufacturing Firms in Nigeria. Journal of Economics,
Management and Trade, 21(4), 1-12.
[29]Alexander V Laskin. (2018).The Third-Person Effects in the Investment Decision Making: A Case of Corporate
Social Responsibility. Corporate Communications: An International Journal, 23(3), 456-468.
[30] Andrej Démuth. (2013). Perception Theories.

Volume 53, ISSUE 2 (MAY - AUG), 2019 2583

Caribbean Journal of Science ISSN: 0008-6452

influenced by a wide range of individual factors that can lead to an inadequate interpretation [ 31]. Kant theory of
perception states that the capacity to acquire representations through the way in which we are affected by objects is
called sensibility. Objects are therefore given to us by means of sensibility, and it alone affords us intuitions. It
suggests the objects external stimuli or factors the CSR initiatives of companies, stimulates the sensibility of investors
with respect to socially responsible [ 32].

1.3.a. Corporate Social Responsibility Initiatives

The following CSR initiatives considered should foster the perceptual differences among the sample investors of the
study as initiatives for protecting the natural environment, initiatives for the betterment of community, initiatives for
laws and regulation, and Initiatives for following moral and ethical values. Initiatives for protecting the natural
environment, the organizations enhance to manufacturing only products that pose no risk to the environment when
they are used as intended by customers and consumers, conserving natural resources by using raw materials and
energy responsibly, using environmentally-friendly technology in research and production, avoiding and reducing
waste; using recycling and environmentally-friendly disposal systems, reducing risks to soil, air and water to the
greatest extent possible and preparing for potential dangerous situations in order to protect both people and the
environment.
Initiatives for the betterment of community, the organizations enhance to mapping the needs of the communities and
undertaking relevant projects, enhancing employability of the underprivileged youth with skill development programs
to make them industry-ready, efficient, vertically mobile, and promoting safety of all road users by creating
infrastructure and curriculum for quality driving [33].Initiatives for laws and regulation, organizations that
understanding the society has sanctioned an economic system by permitting our business to assume the productive
role, as a partial fulfillment of the social contract, it has also laid down the ground rules the laws under which business
is expected to operate. Legal responsibilities reflect a view of codified ethics in the sense which embody basic notions
of fairness as established by our lawmakers. Business is bound by Law for the benefit of society. If business does not
agree with laws that have been passed or are about to be passed, our society which has been provided with a
mechanism.
Initiatives for following moral and ethical values, organization should embrace those activities and practices that are
expected or prohibited by societal members even though they are not codified into law. Ethical responsibilities
embody the range of norms, standards, and expectations that reflect a concern for what consumers, employees,
shareholders, and the community regard as fair, to protection moral rights. The civil rights, environmental, and
consumer movements reflect basic alterations in societal values and thus may be seen as ethical bellwethers
foreshadowing and leading to later legislation 34.

1.4. Objectives of the study

The study has the following objectives.1.To study perception of investors on CSR. 2. To scrutinize difference among
profile of investors and their perception on CSR. 3. To examine relation among perception of investors on CSR and
their investment decision.

[31] Eysenck, M. W., Keane, 2010 M.T.: Cognitive psychology. Psychology Press, 121 — 152.
[32]Samantha Matherne, 2015 Images and Kant’s Theory of Perception. Ergo vol. 2, no.29
[33]Retrived at
//economictimes.indiatimes.com/articleshow/63300615.cms?from=mdr&utm_source=contentofinterest&utm_medium
=text&utm_campaign=cppst
[34]M. Sanjoy Singh , Kh. Tomba Singh, 2013 Rural Poverty Alleviation Programmes: A Study Of Mgnrega In Manipur,
International Journal of Humanities and Social Science Invention. Vol 2 Issue 9 PP.39-43

Volume 53, ISSUE 2 (MAY - AUG), 2019 2584

Caribbean Journal of Science ISSN: 0008-6452

1.5. Research hypotheses of the study

The study has the following hypotheses. 1. There is a significant difference among perception of investors on CSR
and their profile.2. There is a significant relation among perception of investors on CSR and their investment decision.

2. Methodology
The empirical study was carried out in Tamil Nadu state India. The 300 sample investors investing in NIFTY 50
Mumbai stock market randomly selected for data collection through questionnaire survey. It was fixed the face and
content validity for the questionnaire by the industry and academic experts. Data were collected and manually
encoded and used SPSS 20 version for analysis. Percentage analysis was conducted to understand the profile of
investors, mean and standard deviation was worked out to study the perception of investors on CSR. T-test and F-test
administered to scrutinize the perceptual difference among the profile of investors and their perception on CSR.
Correlation analysis was carried out to examine the relationship between perception of investors on CSR and their
investment decisions in stock market.

3. Results and discussion

3.1. Distribution of sample respondents
The study reveals that 56.67 percent of investors are male, while, 43.33 percent of investors are female. The 29.67
percent of investors fall under the age category of 41 – 50 years, while, 16 percent of them fall under the age category
of 21 – 30 years. Most of the respondents 32.67 percent, 19 percent of investors possess under graduation, higher
secondary respectively. Most of the respondents are 38.67 percent private sector employees and 11.33 percent are
retired persons. The results make clear that 36.67 percent of investors earn monthly income of Rs.30,001 – Rs,40,000,
while, 13.66 percent of them earn monthly income of more than Rs,50,000. Maximum respondents 34.33 percent of
investors invest Rs.50,001 – Rs.75,000, while, 20.00 percent of them invest less than Rs.25,000 annually.

3.2 Perception of investors on CSR.

The Perception of Investors on identified variables with respect to Corporate Social Responsibility as Companies
taking initiatives for protecting natural environment (M=3.90) (SD=0.98), initiatives for being socially responsible for
betterment of community (M=3.92) (SD=0.94), initiatives for compiling laws and regulation (M=3.84) (SD=1.05),
initiatives for not doing any kind of harm to environment (M=3.34) (SD=1.10), initiatives for contributing resources
to community (M=3.88) (SD=1.06), initiatives for involving in conservation of environment (M=3.80) (SD=1.04),
initiatives for keeping ethical values in order to attain their goals (M=3.27) (SD=1.14), initiatives for constantly
striving for higher returns to their share holders (M=3.85) (SD=1.03), initiatives for doing right and fair things
(M=3.36) (SD=1.07), and initiatives for always functioning within legal frame of society (M=3.78) (SD= 1.08). The
study reveals that most of the investors agree with variables, socially responsible for betterment of community,
protecting natural environment and contributing resources to community. It is proved that above mentioned identified
variables of CSR attracting the investors for investments based on their perceptual response. Most of the respondents
disagree with variables keeping ethical values in order to attain their goals, and generally doing right and fair things,
which do not attract the investors for investment.

Table-1 Distribution of Investors Perception on CSR

Low Moderate High Total
Level of Perception on CSR
Number of Investors 76 131 93 300
Percentage 25.33 43.67 31 100
Source: SPSS output

Mean ± SD used to segregate the level of perception on CSR into low, moderate and high. Mean value is 36.94 and
SD value is 5.97. Maximum numbers of investors (43.67 percent) come under moderate level of perception on CSR
overall. It was identified and analyzed the differences in the level of perception on CSR initiatives across the
groups as gender, age, educational background, occupation, monthly income and annual investment as
following in next sections.

Volume 53, ISSUE 2 (MAY - AUG), 2019 2585

Caribbean Journal of Science ISSN: 0008-6452

Table-2 Gender Differences in perception on CSR

Level of Perception on CSR
Gender Total (%) Sig.
Low (%) Moderate (%) High (%) t-Value
Male 39 (22.94) 71 (41.77) 60 (35.29) 170 (56.67)
2.658 .008
Female 37 (28.46) 60 (46.15) 33 (25.39) 130 (43.33)
Total 76 (25.33) 131 (43.67) 93 (31.00) 300 (100.00) - -
Source: SPSS output

The gender differences studied and identified in existing literatures predicting the level of perception on CSR
initiatives attracting the investments. Among 300 sample investors, 35.29 percent of male investors have a high level
of perception on CSR initiatives, while, 25.39 percent of female investors have high level of perception. Spearman
correlation coefficient r = 0.61, p value 0.002 <.05 shows that there is a significant positive relationship between
gender of the respondents and the level of perception on CSR initiatives. The calculated t-value = 2.658 exhibits
significance at one percent level that demonstrating significant difference prevails in perception on CSR between male
and female investors for investment decision.

Table-3 Differences in Age Groups perception on CSR

Level of Perception on CSR
Age Category Total F- Sig.
Low (%) Moderate (%) High (%)
Value
21 – 30 years 11(22.92) 18(37.50) 19(39.58) 48(16.00)
31 – 40 years 15(17.86) 30(35.71) 39(46.43) 84(28.00)
5.141 .002
41 – 50 years 26(29.21) 47(52.81) 16(17.98) 89(29.67)
51 – 60 years 24(30.38) 36(45.57) 19(24.05) 79(26.33)
Total 76(25.33) 131(43.67) 93(31.00) 300(100.00) - -
Source: SPSS output

The age of the sample investors analyzed and studied in predicting the level of perception on CSR. Most of the
respondents belong to 31 – 60 yrs age group have moderate level of perception. Spearman correlation coefficient r =
0.63, p value 0.020 < .05 shows that there is a significant positive relationship between age factor and the level of
perception of CSR initiatives for attracting investment. The calculated F-value = 5.141 shows that there is a
significant difference prevails across the age groups in the level of perception on CSR This is an added advantage to
prove the scope of the present investigation.

Table-4 Differences in education groups perception on CSR

Level of Perception on CSR
Education Total (%) Sig.
Low (%) Moderate (%) High (%) F-Value
Higher Secondary 19 (33.33) 22 (38.60) 16 (28.07) 57 (19.00)
Diploma 17 (25.76) 29 (43.94) 20 (30.30) 66 (22.00)
7.253 .000
Under Graduation 12 (12.24) 43 (43.88) 43 (43.88) 98 (32.67)
Post Graduation 28 (35.44) 37 (46.84) 14 (17.72) 79 (26.33)
Total 76 (25.33) 131 (43.67) 93 (31.00) 300 (100.00) - -
Source: SPSS output

The educational qualification of sample respondents analyzed and explored a significant factor determining the
investment types and options in stock market. The level of education may enhance to different level of perception on
CSR. Most of the respondents belong to UG and PG educational qualification group have moderate level of
perception. Spearman correlation coefficient r= 0.65, p value 0.030 < .05 shows that there is a significant positive
relationship between educational background and the level of perception on CSR initiatives. The calculated F value =

Volume 53, ISSUE 2 (MAY - AUG), 2019 2586

Caribbean Journal of Science ISSN: 0008-6452

7.253 shows that there is a significant level of differences across the education groups. It proved the significant level
of interest of CSR activities attracting for investments among the post graduate level of investors.

Table-5 Differences in Occupation groups perception on CSR

Level of Perception on CSR
Occupation Total (%) F- Sig.
Low (%) Moderate (%) High (%)
Value
Business 14 (27.45) 21 (41.18) 16 (31.37) 51 (17.00)
Government 27 (27.27) 49 (49.50) 23 (23.23) 99 (33.00)
6.620 .000
Private 27 (23.28) 45 (38.79) 44 (37.93) 116 (38.67)
Retired 8 (23.53) 16 (47.06) 10 (29.41) 34 (11.33)
Total 76 (25.33) 131 (43.67) 93 (31.00) 300 (100.00) - -
Source: SPSS output

The occupation of sample respondents analyzed and showed a significant impact on level of perception. Most of
respondents are working in Government and Private sectors have moderate level of perception. Spearman correlation
coefficient r= 0.058, p value 0.025 < .05 shows that there is a significant positive relationship between occupation and
the level of perception on CSR. The calculated F value = 6.620 shows the significant difference at one percent level
confirms the popularity of CSR initiatives among the investors with different occupation groups.

Table-6 Differences in Monthly Income groups perception on CSR

Level of Perception on CSR
Monthly Income Total (%) F- Sig.
Low (%) Moderate (%) High (%)
Value
Less than Rs.30,000 25 (29.07) 41 (47.67) 20 (23.26) 86 (28.67)
Rs.30,001 – Rs,40,000 28 (25.45) 46 (41.82) 36 (32.73) 110 (36.67) 7.085 .000
Rs.40,001 – R s,50,000 14 (22.22) 29 (46.03) 20 (31.75) 63 (21.00)
More than Rs,50,000 9 (21.95) 15 (36.59) 17 (41.46) 41 (13.66)
Total 76 (25.33) 131 (43.67) 93 (31.00) 300 (100.00) - -
Source: SPSS output

The income of sample respondents studied and explored an important factor in determining the level of perception on
CSR initiatives attracting investments. Most of the respondents earning monthly income up to Rs 40000/-. They have
moderate level of perception. Spearman correlation coefficient r=0.69, p value 0.034 < .05 shows that there is a
significant positive relationship between monthly income of respondents and the level of perception on CSR
initiatives attracting investments. The obtained F value 7.085 reveals a significant difference at one percent level,
across the income group perception on CSR initiatives.

Table-7 Differences in Annual Investment Groups Perception on CSR

Level of Perception on CSR F-
Annual Investment Total (%) Sig.
Low (%) Moderate (%) High (%) Value
Less than Rs.25,000 14 (23.33) 31 (51.67) 15 (25.00) 60 (20.00)
Rs.25,001 – Rs.50,000 20 (26.67) 44 (58.66) 11 (14.67) 75 (25.00)
6.517 .000
Rs.50,001 – Rs.75,000 25 (24.27) 35 (33.98) 43 (41.75) 103 (34.33)
Rs.75,001 – Rs.1,00,000 17 (27.42) 21 (33.87) 24 (38.71) 62 (20.67)
Total 76 (25.33) 131 (43.67) 93 (31.00) 300 (100.00) - -
Source: SPSS output

Volume 53, ISSUE 2 (MAY - AUG), 2019 2587

Caribbean Journal of Science ISSN: 0008-6452

The annual investment of sample respondents analyzed and explored a significant factor predicting the level of
perception on CSR initiatives and vice versa. Most of the respondents are annually investing up to Rs 75000/-. They
have moderate level of perception. Spearman correlation coefficient r= 0.70, p value 0.025< .05 shows that there is a
significant positive relationship between annual investment of sample respondents and the level of perception on CSR
initiatives attracting investments. The calculated F value 6.517 reveals the significant difference across the different
range of annual investment groups.

3.3 Relationship between Perception of Investors on CSR and Investment Decision

Pearson Correlation analysis shows that there is a significant positive relationship between the perception of investors
on CSR and Investment Decision in stock Market, since (r=0.57), p value 0.002<.05. There is a significant positive
relationship between the perception on protecting natural environment respect to CSR and investment decision, since
(r=0.52), p value 0.045<.05. There is a significant positive relationship between the perception on betterment of the
community respect to CSR and investment decision, since (r=0.49), p value 0.040<.05. There is a significant positive
relationship between the perception compiling laws and regulation respect to CSR and investment decision, since
(r=0.45), p value 0.035<.05. There is a significant positive relationship between the perception on following ethical
and moral values and investment decision, since (r=0.39), p value 0.048<.05. There is a significant positive
relationship between the perception on striving for higher returns to the share holders and investment decision, since
(r=0.55), p value 0.046<.05.

4. Implications
The findings of study elucidate that more than two fifth of investors have moderate level of perception on corporate
social responsibility. As far as CSR initiatives concerned, taking initiatives for protecting environment, providing
resources for betterment of community, compiling laws and regulation, keeping up moral and ethical values, striving
higher returns to shareholders and functioning with in legal frame, have to be implemented effectively and efficiently
across the state. Since moderate level of perception on CSR prevails among the sample respondents across various
groups, the CSR initiatives must be studied in depth as how, when, whom and why, and to be implemented as a
dedicative contribution to the society.
It is revealed that the level of perception among the sample investors on companies initiatives respect to corporate
social responsibility is varied across age, gender, educational qualification, income, occupation and annual investment
groups of investors. As far as the variances across the groups of investors concerned, it has to be reduced. The
strategic initiatives of companies for CSR benchmark have to be effectively, efficiently implemented and improved
for attracting the investments. Among the identified CSR initiatives for corporate social responsibility, initiatives for
contributing to protecting natural environment and no harm to environment, initiatives for accessing resources to
betterment of community, initiatives for giving back to higher returns to stakeholders, attracted the sample
respondents more. The variables following moral and ethical values and treatment of fairness the shareholders, do not
attract the respondents so much. As far as investment attraction among investors concerned, it has to be enabled by the
corporate companies the socially and environmentally responsible strategic initiatives to be extended by the alignment
of partnership with government organisations or private non government organisations through expansion of services
with volunteer dedicative contribution principle to the betterment of society.

5. Direction for further research

The study explored the relationship of the profile of sample investors with the level of perception on CSR initiatives.
It shows the perceptual differences across the sample groups age, gender, occupation and income. Further, it may be
studied and explored the relationship of personality type of sample investors and level of perception on CSR. The
required competency and expertise of investors for investment decision in stock market may be studied and explored.
The study has focused on sample investors from Tamil Nadu state investing in any random companies listed in
NIFTY 50 Mumbai stock exchange. Future studies may focus on investors from other states of India investing in
other stock exchanges. The study shows perceptual differences among the sample investors, CSR initiatives and the
relationship of perception with investment decision, further it may be studied investors investment choices, plans,
types, and patterns may be studied.

Volume 53, ISSUE 2 (MAY - AUG), 2019 2588

Caribbean Journal of Science ISSN: 0008-6452

References:

1. Alexander V Laskin. (2018).The Third-Person Effects in the Investment Decision Making: A Case of
Corporate Social Responsibility. Corporate Communications: An International Journal, 23(3), 456-468.
2. Andrej Démuth. (2013). Perception Theories.
3. Beal, D. J., Goyen, M., & Phillips, P. (2005). Why do we invest ethically?. Journal of Investing, 14(3), 66-78.
4. Caroline Flammer.(2013). Corporate social responsibility and shareholder reaction: The environmental
awareness of investors. Academy of Management Journal, 56(3), 758-781.
5. Chin-Shien Lin, Ruei-Yuan Chang, & Van Thac Dang.(2015). An integrated model to explain how corporate
social responsibility affects corporate financial performance. Sustainability, 7, 8292-8311.
6. Clarkson, M. B. E. 1995. A stakeholder framework for analyzing and evaluating corporate social
performance. Academy of Management Review, 20: 92-117.
7. Donaldson, T., & Preston, L. 1995. The stakeholder theory of the corporation: Concepts, evidence, and
implications. Academy of Management Review, 20: 65-91.
8. Eysenck, M. W., Keane, 2010 M.T.: Cognitive psychology. Psychology Press, 121 — 152.
9. //economictimes.indiatimes.com/articleshow/63300615.cms?from=mdr&utm_source=contentofinterest&utm_
medium=text&utm_campaign=cppst
10. Freeman, R. 1984. Strategic management: A stakeholder perspective. Englewood Cliffs, NJ: Prentice-Hall.
11. Godfrey, P. C. 2004. The relationship between corporate philanthropy and shareholder wealth: A risk
management perspective. Academy of Management Review, 30: 777 798.
12. Hofmann, E., Hoelzl, E., & Kirchler, E. (2008). A comparison of models describing the impact of moral
decision making on investment decisions. Journal of Business Ethics, 82(1), 171-187.
13. Kumar, R., Murphy, D. F., & Balsari, V. (2001). Altered images: The 2001 state of corporate responsibility in
India poll. Understanding and encouraging corporate responsibility in south Asia – Update 1. Tata Energy
Research Institute, New Delhi.
14. Leda Nath, Lori Holder-Webb, & Jeffrey Cohen.(2012). Will women lead the way? Differences in demand
for corporate social responsibility information for investment decisions. Journal of Business Ethics, 118(1),
85-102.
15. Lovins, A., Lovins, L.H., & Hawken,P.(1999). A Road map for Natural Capitalism. Harvard Business
Review, 145-158.
16. Luc Renneboog , Jenke Ter Horst , Chendi Zhang b,(2008). Socially responsible investments: Institutional
aspects, performance, and investor behaviour. Journal of Banking & Finance 32 1723–1742
17. M. Sanjoy Singh , Kh. Tomba Singh, 2013 Rural Poverty Alleviation Programmes: A Study Of Mgnrega In
Manipur, International Journal of Humanities and Social Science Invention. Vol 2 Issue 9 PP.39-43
18. Marrewijk. (2003). Concept and definitions of CSR and corporate sustainability: between agency and
communion. Journal of Business Ethics, 44(1), 95-105.
19. Mohammed Benlemlih, & Mohammad Bitar.(2016). Corporate social responsibility and investment
efficiency. Journal of Business Ethics, 122(2), 1-24.
20. Mutch, N., & Aitken, R. (2009). Being fair and being seen to be fair: Corporate reputation and CSR
partnerships. Australasian Marketing Journal, 17(2), 92-98.
21. Mitchell, R., Agle, B., & Wood, D. 1997. Toward a theory of stakeholder identification and salience:
Defining the principle of who and what really counts. Academy of Management Review, 22: 853-886.
22. McWilliams, A., & Siegel, D. 2001. Corporate social responsibility: A theory of the firm perspective.
Academy of Management Review, 26: 117-127.
23. Ojenike J. O., Odunsi, A.O., & Atunbi J.A.(2014). Perception of corporate social responsibility in Nigeria: An
empirical investigation. International Journal of Business and Management Invention, 3(9), 69-73.
24. Okere Wisdom, Imeokparia Lwarence, Ogunlowore John Akindele, & Isiaka Muideen.(2017). Corporate
Social Responsibility and Investment Decision in Listed Manufacturing Firms in Nigeria. Journal of
Economics, Management and Trade, 21(4), 1-12.
25. Pasewark, W. R., & Riley, M. E. (2010). It’s a matter of principle: The role of personal values in investment
decisions. Journal of Business Ethics, 93, 237-253.

Volume 53, ISSUE 2 (MAY - AUG), 2019 2589

Caribbean Journal of Science ISSN: 0008-6452

26. Petra F A Dilling.(2011). Stakeholder perception of corporate social responsibility. International Journal of
Management and Marketing Research, 4(2), 23-34.
27. Porter, & Kramer. (2002).The competitive advantage of corporate philanthropy. Harvard Business Review,
186-192.
28. Paine, L. S. 2002. Value shift. New York: McGraw-Hill.
29. Samantha Matherne, 2015 Images and Kant’s Theory of Perception. Ergo vol. 2, no. 29
30. Swanson, D. L. 1999. Toward an integrative theory for business and society: A research strategy for corporate
social performance. Academy of Management Review, 24: 506-521.
31. Stephen Brammer, Chris Brooks, Corporate Social Performance and Stock Returns: UK Evidence from
Disaggregate Measures
32. Swaen, V., & Chumpitaz, R. (2008). Impact of corporate social responsibility on consumer trust. Recherche et
Applications en Marketing, 23(4), 7-33.
33. Waymond Rodgers, Hiu Lam Choy, Andres Guiral,(2013). Do Investors Value a Firm’s Commitment to
Social Activities?.J Bus Ethics 114:607-623
34. Whetten, D. A., Rands, G., & Godfrey, P. C. 2001. What are the responsibilities of business to society? In A.
Pettigrew, H. Thomas, & R. Whittington (Eds.), Handbook of strategy and management: 373-410. London:
Sage.
35. Wood, D. J., & Jones, R. E. 1995. Stakeholder mismatching: A theoretical problem in empirical research on
corporate social performance. International Journal of Organiza tional Analysis, 3: 229-267.
36. Waddock, S. A. & Graves ,S. B. 1997. The corporate social performance-financial performance link. Strategic
Management Journal, 18: 303-319.

Received 8 April 2019

Received in revised form 21 May 2019
Accepted 01 July 2019
Available online 02 July 2019

Volume 53, ISSUE 2 (MAY - AUG), 2019 2590