Abstract:
The study examines the linkage between CSR and financial performance through
competitive advantage and access to capital and the moderating role played by
corporate governance using rural banks as a study case. A sample of 126 rural banks
was selected, data on financial performance were collected from the 2019 financial
statement whereas data on CSR, competitive advantage, access to capital and
corporate governance was collected through the use of questionnaire. The data was
analyzed using structural equation modeling and hierarchical regression. The study
has shown that, business organizations that practice CSR activities, in-turn, gain a
defensible competitive position in their industry which intend gives them access to
capital to fund their business strategies, hence having positive impact on their
financial performance. This observation, however, depends on the efficiency of
their corporate governance practices in the organisation. The study recommends
that, the activities of CSR should be integrated as part of the firm’s corporate and
business level strategies.
