South Africa: CSR as a Driver of Financial Performance

A May 2025 study in the Journal of Risk and Financial Management explores how CSR performance relates to financial outcomes among Johannesburg Stock Exchange (JSE) firms. Using data from 104 companies between 2017 and 2022, the authors found a strong positive correlation between CSR metrics—including ESG ratings and social pillar scores—and key financial indicators such as return on assets and Tobin’s Q. This suggests that firms investing in CSR may see tangible financial gains. The study also analyzed board dynamics, revealing that gender diversity improves financial performance, while high board independence and frequent meetings had a negative effect. The findings point to the nuanced role governance plays in maximizing the financial benefits of CSR.