Corporate Social Responsibility and Financial Performance of Listed Firms in Nigeria: The Moderating Role of Firm Size

This study examines the relationship between Corporate Social Responsibility (CSR) — decomposed into environmental (ENV), social (SOC), and governance (GOV) scores — and the financial performance of listed firms in Nigeria, as measured by Return on Assets (ROA), Return on Equity (ROE), and stock returns (SR). Using an ex-post facto research design and unbalanced panel data from 151 listed firms on the Nigerian Exchange Group (NGX) for the period 2011 to 2025, the study employs fixed-effects and random-effects panel regression models, with firm size serving as a moderating variable. Leverage (LEV), growth opportunities (GO), and macroeconomic factors (MF) are incorporated as control variables. The Hausman specification test, variance inflation factor (VIF) diagnostics, and cross-sectional dependence tests are deployed as post-estimation checks. Results indicate that environmental scores have a statistically significant positive effect on ROA and ROE but an insignificant relationship with stock returns, while social scores positively and significantly predict all three financial performance proxies. Governance scores exhibit a robust and consistent positive association with financial performance across all dimensions. Firm size significantly moderates the CSR-financial performance nexus, with larger firms deriving stronger performance benefits from CSR investment. These findings offer novel evidence from a Sub-Saharan African context, contribute to stakeholder and signalling theory applications in emerging markets, and carry significant implications for policymakers, corporate managers, and investors in Nigeria. The study concludes by advancing a reform agenda for mandatory ESG disclosure standards within the Nigerian regulatory framework.