Nexus between corporate social responsibility and financial and non-financial sectors' performance: a non-linear and disaggregated approach.

The objective of this study is to examine the relationship between corporate social performance (CSP) as proxy of corporate social responsibility (CSR) and corporate firm's performance (CFP) in the context of Pakistani financial and non-financial firms sectors. This study comprises two main firm's performance indicators such as market base (excess stock returns) and accounting base (returns on assets and returns on capital). The data set starts from 2011 to 2017 and consists of three hundred and fifty (350) firms on equal numbers of financial and non-financial firms. This study uses a non-linear and disaggregated approach for data analysis. The results of the linear model indicate that CSP and returns on capital have a negative relationship, while the non-linear model of CSP and accounting base performance as CFP have positive association in the domain of long run. There is a significant relationship that exist among environmental social governance (ESG) disclosure score, government sub-components score, and social performance. However, a U-shaped association found between CFP and government sub-components, which further suggest that governance has a vital role toward CSP and CFP components.