The value relevance of Corporate Social Responsibility and Bank Performance: Case of Egypt

Corporate social responsibility disclosure is still immature in developing countries, according to previous research on emerging economies, with room for improvement in both actions taken and disclosed information quantity and quality. Egypt is one of the countries that has made significant strides in this direction. Since 2016, the Egyptian Central Bank and Stock Exchange have required listed companies, including banks, to report more CSR. This paper examines how CSR reporting affects financial institutions' performance especially, after government initiatives. After excluding banks without financial data, the study examines 34 banks for the period (2015-2022). Two primary indices, which are based on the G4 Sustainability Reporting Guidelines (2013) and uses content analysis, are utilized to measure the quality and quantity of CSRD ( the independent variable). Structural equation modeling (SME) and Person correlation examine empirically the relationship between CSRD and bank performance. ROA, ROE, and NIM determine bank financial performance (FP) ( the dependent variable). Bank age and size are control variables. The findings reveal some progress in CSR reporting in Egyptian banks and that CSRD and FP are positively correlated. These findings suggest the government and Egyptian Stock Exchange regulate and standardize bank CSR disclosure. Regulations should consider information quality to benefit the community and reduce the disclosure gap between national and international banks