The Impact of Corporate Social Responsibility on Company Profits

Abstract

In the current context of globalization and increased competition, the issue of social responsibility of business is of particular relevance, since the integration of social initiatives into corporate strategy not only improves the image of companies but also ensures their financial stability and sustainable development. The relevance of the study is due to the need for an in-depth analysis of the impact of corporate social responsibility on the economic performance of enterprises in the context of economic uncertainty and crisis phenomena. In the course of the study of business social responsibility, two main areas of corporate social responsibility were considered: internal and external. Internal corporate social responsibility included expenses for employees, including social benefits, professional development programs, ensuring safe working conditions, etc. The analysis showed that during the period under study, the costs of internal corporate social responsibility grew steadily, which indicates that companies are paying more attention to the social well-being of employees. With regard to external corporate social responsibility, the activities of enterprises implementing social projects in various areas, such as environmental safety, support for local communities, charity and innovative educational programs, were identified and substantiated. Specific examples of companies investing in these areas, as well as the amount of their social expenditures, are provided. It is established that companies that actively implement external social projects attract more attention from external investors, which contributes to their financial attractiveness. The study proposes a linear ERR-sil model to determine the impact of capital investments in social projects on the profitability of enterprises. The application of this model allowed to establish a clear relationship between the level of social investment and financial performance of companies. The results of the study confirm that the integration of social responsibility principles into business strategies not only improves the social climate within the company, but also has a positive impact on its profitability, helping to attract investment and strengthen its competitive position in the market.