Role of Corporate Social Responsibility between Mental Accounting and Investment Decision Making

Authors

  • Shamim Akhtar 2Assistant Professor Department of Business Administration Faculty of Management and Administrative Sciences University of Sialkot, Pakistan
  • Sania Sharif 1Ph.D. scholar Department of Business Administration University of Sialkot, Pakistan
  • Muhammad Abdullah Kamboh Department of Business Administration University of Sialkot, Pakistan

Keywords:

Corporate Social Responsibility, Mental Accounting, Investment Decision Making

Abstract

Purpose: The study aims to explore the role of corporate social responsibility (CSR), specifically its social and environmental dimensions, in moderating the relationship between mental accounting and investment decision-making among Pakistani equity market investors.

Design/Methodology/Approach: Primary data was collected through questionnaires distributed in Lahore and Islamabad stock exchanges. The sample included 613 investors, and data analysis was conducted using AMOS. The study analyzed the complete sample and further examined the two CSR dimensions for robustness across genders, distinguishing between male and female investors.

Findings: The results indicate that mental accounting significantly influences investment decisions, with an increase in mental accounting bias correlating with higher investment levels. While the overall CSR score does not show a significant relationship, the social and environmental dimensions positively impact investment decisions. Notably, social CSR significantly moderates between mental accounting and investment decisions.

Practical implications: The investors and policy makers could gain awareness of CSR specifically its social and environmental dimensions.

Originality/ Value: The study’s novelty lies in uncovering the moderating role of CSR between mental accounting and investment decisions.

 

Published

2024-03-30