Regardingthe regression in model 3, those investigate the impact of FP on voluntary CSRactivities index. The results are shown in Table 5.

As can be seen all the modelsare significant at least at Prob. F < 0.05 and explains 45.

17 % of thevariation in profitability (ROA) and, similar for ROE measure of FP the Adj. R-squaredis equal to 0.368 means that our model explains about 37% of the behavior ofthe independent variable. However, our models did not presentmulti-collinearity problems, autocorrelation problem even the problems ofheteroscedasticity because we carried out the respective statistics test tosolve it, as presented in Table 5. We highlighted ROA and ROE variables as allbeing statistically significant and positive, for ROA (Coeff. = 0.0021, P-Value< 0.05 and t-Stat.

= 3.131) and for ROE variable (Coeff.= 0.0035, P-Value< 0.01 and t-Stat. = 2.762), respectively. The findings are in accordancewhit Rodriguez-Fernandez(2015) study, supporting thebidirectional relationship between CSR activities and FP and vice versa.

So wehave evidence to support our hypothesis H3 and we conclude that the betterprofitable banks are those that adopt greater CSR behavior.(Insert around hereTable 5)ConclusionStarting from thehypothesis, an empirical study has been developed, we examine the relationshipbetween CSR and FP, using the Mozambican banking industry as a sample coveringthe period from 2010 to 2016. Applying ROA and ROE as our measure of FP andusing content analysis of annual financial reports for obtaining quantitativedata and supplementing these data by searching the firms’ websites reportsabout CSR discloser as a measure of CSR, our main findings can be summarized inthese points. Firstly, the coefficient ?1 that captured therelationship between CSR and FP was significantly consistent with previousliterature (Platonova etal., 2016, Rodriguez-Fernandez 2015) providing evidence that themanagers are engaged in CSR behavior through FP. Additionally, we expected andprovided that banks displaying ahigher level of CSR behavior achieve greater financial profitability in theMozambican Banking sector.Secondly,with regards to the impact of FP on CSR activities index, the findings showsimilar outcomes that were found when we examined the impact of CSR activitieson FP.

All results was statistically significant and positive suggesting thatCSR behavior leads to better firms’ profitability and the higher profitabilityis driven by CSR activities, thus, create a positive relations in bothdirections. Jointly, these findings support our hypothesis H0, H1,and H3.Thirdly, we examined the impactof each category of voluntary CSR activities on the financial performance, thefindings were insignificant for environmental protection category of CSRactivities, however, and for the other three categories of CSR activities, andthe findings were positive and significant.

Thus, we did not find evidence tosupport our hypothesis H2. Furthermore, we expected and providedevidence that the banks primarily disclose information about their customer& products comparatively to other categories of CSR practices in oursample. Generally, our findings confirm other prior research in the field providing evidence that the CSR activitiesare related to financial performance.Thisstudy is subject to at least one limitation: the fact that the studyconcentrates on a single under-developed country may limit the possibility ofgeneralizing the findings. Nevertheless, we believe that in the Mozambicanbanking industry this research is a novelty, the first studying therelationship between CSR and FP because in our literature review there wasscanty evidence.

Future research could consider the application of differentmeasure of CSR activity and expand the period of analysis. We believe that thisresearch will contribute to filling the existing gap in literature and, alsohighlighting the importance of the manager engaged in CSR activities to have abetter FP and confirm the stakeholder theory in the banking sector,particularly in the African context. ReferenceAl-Smdi, A.

W. (2016). The relationship betweenCorporate Social Responsibility and Financial Perform

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