Corporate Social Responsibility and Shareholders’ Wealth of Listed Manufacturing Firms on the Nigerian Exchange Group PLC (NGX)

This study assessed the effect of corporate social responsibility on shareholders’ wealth of industrial goods manufacturing firms listed on the Nigerian Exchange Group plc (NGX). A sample of Ten (10) listed industrial goods manufacturing firms was selected from a study population of 24 industrial firms listed on the Nigerian Exchange Group plc (NGX) as at 31st December, 2020. This sample size was purposively selected based on the availability of complete annual reports for 18 years beginning from 2003 to 2020. With the aid of Econometrics Views (EViews) statistical software, the formulated research hypotheses and data collected, were analysed using descriptive and inferential statistics, multiple regression, fixed and random effects estimators, stationarity test of all research variables and residuals of six research models, cross-section dependence test, Durbin Watson test and the Hausman test. The study revealed that corporate social responsibility to society, corporate social responsibility to suppliers and corporate social responsibility to customers had non-significant negative relationships with economic value added while corporate social responsibility to employees and corporate social responsibility to tax authorities had significant negative relationships with economic value added. However, corporate social responsibility to lenders had a non-significant positive relationship with economic value added. These findings have therefore, provided the desired evidence needed to prove our apriori expectation that the corporate social responsibility practices of industrial goods firms in Nigeria are not generating additional value for shareholders. CSR managers in the industrial goods sector of Nigeria should use shareholders’ funds ethically and responsibly when fulfilling their firms’ corporate social responsibilities. The study recommends among others that the managers of industrial goods firms in Nigeria should desist from rent-seeking, non-disclosure of CSR expenditures and indiscriminate CSR expenditures. The study also recommends as follows: improved relationships with employees, fair dealings with suppliers and customers and reduction in the currently high leverage ratios.