Impact of Corporate Citizenship Activities on the Financial Performance of the Nepalese Life Insurance Companies

Abstract

Corporate Citizen Activities (CCA) is essential for any organiztion to attract and retain customers, and to beat the competition. CCA are the indirect and intangible assets of organizations and their response is a key indicator to achieve organizational goals. This paper attempts to examine the impact of corporate citizenship activities on the financial performance of Nepalese insurance companies. Descriptive and causal-comparative research designs are used to estimate the relationship of financial performance, the ROA and the NI (dependent variables) with independent variables (economic responsibilities, legal responsibilities, ethical responsibilities, and discretionary responsibilities). Data are collected from 325 respondents of 19 life insurance companies through structured questionnaires where the questionnaire was distributed to 500 respondents (the response rate is 65 per cent). Descriptive statistics, correlation, and multiple regression models are used to analyse the data. It is found that legal responsibility and discretionary responsibility are the major factors in determining the financial performance of insurance companies in Nepal. CCA helps to bust up the return in terms of profit.