THE RELATIONSHIP BETWEEN CORPORATE SOCIAL RESPONSIBILITY AND FINANCIAL PERFORMANCE IN BANKING INDUSTRY PERIOD 2010 – 2012

Abstract

This research aims to find out the relationship between the Corporate Social Responsibility and Financial Performance at banking industries in Indonesia. Corporate Social Responsibility is activity form which pay attention on economic aspect social and around environment. In this research, financial performance is measure by using the financial ratio such as Capital Adequacy Ratio (CAR), Non-Performing Loan (NPL), Return on Asset (ROA), Return on Equity (ROE) and Loan to Deposit Ratio (LDR). This research using Correlation analysis to analysis the relationship Corporate Social Responsibility (CSR) and Financial Performance. Banking industries using in this research the 10 banks as the sample who attach their fund of CSR activity in annual report of the company and publish in the Website or Media. And this research using the Pearson Coefficient Correlation and Scatterplot to analyze the relationship between CSR and Financial Performance. Based on the result, the researcher find the CSR and CAR is not have a relationship because this relationship is not significant. And for CSR with (ROA & ROE) is have a positive relationship and that relation is strong and significant. And CSR with (NPL & LDR) is have a negative relationship in medium level and that significant.