The Relationship Between The Company Social Responsibility And Profitability: Take The Listed Manufacturing Companies As An Example

Every enterprise is a single economic cell of the whole society; it isan important participant in the market economy, and also takes theimportant role in sustainable development and social wellbeing. Theorientation of an enterprise in modern society has evolved from theorganization simplely pursuiting of profits to the corporate citizenshipfulfilling its social responsibility. Undertaking more social responsibilitieshas become the basic requirements for modern enterprises. Enterprise’sbehavior, productions and management, exerts varied influence on thelegitimate rights and interests of different stakeholders including staff,ecological environment, customers, communities and shareholders.Meanwhile, undertaking social responsibility for these stakeholders is oneimportant way of realizing social value and social progress, alsocontributing to its sustained and healthy development, which is a stillimportant part in the establishment of a harmonious socialist society.But what exactly do the social and responsibility mean in theso-called corporate social responsibility? Different scholars contributedtheir own different achievements based on their respective subject areas.Based on the existing academic achievements, the paper defines corporatesocial responsibility in detail according to the stakeholder theory, andmainly focuses on the analysis of economic responsibilities to shareholder,employees, customers, creditors, suppliers, government, public, andenvironment. The essay takes twenty-two kinds of indexes into account,such as EPS, salary welfare rate, main business cost rate, and the multipleof interest safeguard, to measure corporate social responsibility. TheParticle Swarm Optimization has been adopted for the index system todetermine the weight; each enterprise’s social responsibility performinglevel score is then calculated; a series of ratios are employed including the return on equity, return on total assets, return on capital, the basic EPSafter deducing non-recurring profit and loss to measure profitability.Analyzing data from61listed companies from2007to2011, its empiricalresults are obtained as follows: in terms of China’s enterprise socialresponsibility performing, there is a positive relationship betweencorporate’s social responsibility performing and its profitability, whichare also reciprocal causation. Therefore, the enterprise, government,public opinions should correctly guide social responsibility and playpropaganda effect, to promote enterprises to actively fulfill the socialresponsibility.