Theoretical and Conceptual Approach of Corporate Governance and CSR Activities in Financial Decision Making

Abstract

In today's business world, corporate social responsibility (CSR) and corporate governance have become essential components. They have a big impact on financial decision-making processes in addition to organizational behavior. The objective of this chapter is to offer a thorough theoretical and conceptual framework for comprehending how financial decision-making, CSR initiatives, and corporate governance interact inside businesses. Foundations of Corporate Governance Theoretically explain about how agency theory clarifies how shareholders and management interact as principals and agents, highlighting how important it is to have aligned interests to reduce agency conflicts. Examine how this theory emphasizes the wider societal impact of company actions by promoting the consideration of multiple stakeholder interests beyond shareholders and Analyze how this theory affects governance frameworks and decision-making procedures by emphasizing how dependent organizations are on outside resources.