social responsibility. An increase of this size in one year is notable and could be a sign that responsible behavior has positive effects on ROS. If this trend continues the socially responsible company could find itself having a greater return on sales than the benchmark. Due to this it could be possible that socially responsible behavior could have the capability of having a positive correlation to ROS. If the ROS has the capability of at being equivalent between a socially responsible company and non-socially responsible firm it would not be detrimental to practice corporate social responsibility. In 2011 Johnson & Johnson the socially responsible company was faced with numerous recalls and these unexpected costs could be why the ROS is lower in that year. If this is the reason that the ROS is lower, then acting socially responsible would not be the cause of the lower ROS. Instead it would be the recalls that lowered the ROS in that year. Unfortunately, the results of this examination cannot prove that there is a positive correlation between acting socially responsible and Return on Sales. The results of this investigation showed that socially responsible companies do not have a greater Return on Equity than ordinary companies. In 2011 and 2012 the socially responsible company had a ROE that was 1.3% and 1.1% during the respective years. The amount of revenue that got generated for each dollar of equity by the responsible firm was faintly lower than that of the benchmark. From this data it can be inferred that when a company acts socially responsible its return on equity can be lower than that of a firm that just focuses on its business processes. The responsible firm may have experienced a lower ROE in both years because instead of focusing on using its equity to maximize profits it was partaking in activities that would have a benefit on society as a whole. The target firm Johnson & Johnson emphasizes in its credo
social responsibility. An increase of this size in one year is notable and could be a sign that responsible behavior has positive effects on ROS. If this trend continues the socially responsible company could find itself having a greater return on sales than the benchmark. Due to this it could be possible that socially responsible behavior could have the capability of having a positive correlation to ROS. If the ROS has the capability of at being equivalent between a socially responsible company and non-socially responsible firm it would not be detrimental to practice corporate social responsibility. In 2011 Johnson & Johnson the socially responsible company was faced with numerous recalls and these unexpected costs could be why the ROS is lower in that year. If this is the reason that the ROS is lower, then acting socially responsible would not be the cause of the lower ROS. Instead it would be the recalls that lowered the ROS in that year. Unfortunately, the results of this examination cannot prove that there is a positive correlation between acting socially responsible and Return on Sales. The results of this investigation showed that socially responsible companies do not have a greater Return on Equity than ordinary companies. In 2011 and 2012 the socially responsible company had a ROE that was 1.3% and 1.1% during the respective years. The amount of revenue that got generated for each dollar of equity by the responsible firm was faintly lower than that of the benchmark. From this data it can be inferred that when a company acts socially responsible its return on equity can be lower than that of a firm that just focuses on its business processes. The responsible firm may have experienced a lower ROE in both years because instead of focusing on using its equity to maximize profits it was partaking in activities that would have a benefit on society as a whole. The target firm Johnson & Johnson emphasizes in its credo
spiletic_kevin_Thesis.docx