Corporate social responsibility disclosure and profitability: Evidence from Islamic banks working in Yemen

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This study aims to examine the influence of corporate social responsibility (CSR) disclosure determinants on profitability of Yemeni Islamic financial institutions. The empirical study was based on a balanced panel for twelve years from 2005 to 2016. Banks’ profitability is measured by four indicators such as return on assets (ROA), return on equity (ROE), profit after tax (PAT), and earnings per share (EPS), while corporate social responsibility, financial leverage, inflation rate, asset size, and age of Islamic banks are considered as independent variables. The results of this study with regard to ROA indicated that corporate social responsibility, asset size, inflation rate, and age of Islamic banks have a significant influence on profitability (ROA). With respect to ROE, the result indicated that financial leverage, asset size, and inflation rate are the most important variables affecting bank profitability (ROE). Concerning PAT, the outcome revealed that financial leverage and age of Islamic banks have a significant effect on profitability (PAT). Finally, the result with respect to EPS indicated that financial leverage, asset size, inflation rate, and age of Islamic banks have a significant impact on bank profitability (EPS). The result will be beneficial to scholars, investors, stakeholders, managers, and policymakers in the Islamic financial sector.

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    • Table 1. Some empirical articles that examined the link between CSD and financial performance.
    • Table 2. Measurement of variables
    • Table 3. Descriptive analysis
    • Table 4. Correlation analysis
    • Table 5. ROA and ROE determinants
    • Table 6. PAT and EPS determinants
    • Conceptualization
      Nabil Ahmed Mareai Senan, Aida Abdulaziz Ali Noaman, Eissa A. Al-Homaidi
    • Formal Analysis
      Nabil Ahmed Mareai Senan, Borhan Omar Ahmad Al-dalaien
    • Investigation
      Nabil Ahmed Mareai Senan, Aida Abdulaziz Ali Noaman, Eissa A. Al-Homaidi
    • Methodology
      Nabil Ahmed Mareai Senan, Aida Abdulaziz Ali Noaman, Borhan Omar Ahmad Al-dalaien, Eissa A. Al-Homaidi
    • Supervision
      Nabil Ahmed Mareai Senan, Aida Abdulaziz Ali Noaman, Eissa A. Al-Homaidi
    • Validation
      Nabil Ahmed Mareai Senan, Eissa A. Al-Homaidi
    • Writing – review & editing
      Nabil Ahmed Mareai Senan
    • Data curation
      Aida Abdulaziz Ali Noaman, Borhan Omar Ahmad Al-dalaien, Eissa A. Al-Homaidi
    • Resources
      Aida Abdulaziz Ali Noaman, Borhan Omar Ahmad Al-dalaien
    • Software
      Aida Abdulaziz Ali Noaman
    • Visualization
      Aida Abdulaziz Ali Noaman, Eissa A. Al-Homaidi
    • Writing – original draft
      Aida Abdulaziz Ali Noaman, Borhan Omar Ahmad Al-dalaien, Eissa A. Al-Homaidi