The objective of the current study is to examine the effect of corporate social responsibility (CSR) practice on corporate financial performance (CFP). The study tested 164 non-financial firms listed on Amman Stock Exchange (ASE) from 2011 to 2014. CSR activities are measured by corporate social responsibility disclosure index (CSRDI) based on content analysis. Meanwhile, corporate financial performance is measured by accounting-based performance and market-based performance. Generalized Method of Moment (GMM) analysis was used to analyze the effect of CSR disclosure on CFP. Firm size, Leverage, and Ownership are included as control variables. The results of current study indicated that there is positive and significant effect of CSR disclosure on accounting-based performance measured by Return on Assets (ROA). Conversely, there is no significant effect of CSR disclosure on market-based performance measured by market Stock Price (SP), and Price to Earnings Ratio (P/E). For control variables only Leverage has significant effect on financial performance measured by ROA. The Current study has implications in enhancing the understanding of financial performance for the firms through understanding the effect of CSR practices on CFP. Furthermore, the results of current study contribute to the previous studies on CSR practices in developing countries.

Corporate social responsibility (CSR) has become important and strategic issue for business in many countries. Over the past three decades, companies have shown a growing interest in the practice of CSR activities through disclosure of these practices in the financial reports. In Jordan, the concepts and principles of CSR are still a voluntary mechanism. There are differences in the implementation of CSR activities between Jordan and other developed countries because there are differences in the culture, nature of economic system, and geographical aspects. Thus, the main purpose of this paper is to expand our knowledge about corporate social responsibility disclosure (CSRD) and about the position of the Jordanian companies toward this issue. This paper investigates the level of CSRD in the annual reports of the 164 non-financial companies that were listed on Amman stock exchange representing the services & industrial sectors from 2011 to 2014. This study developed the CSRD index based on Global Reporting Initiatives (GRI) framework. GRI framework covers six main dimensions of CSR activities which are Economic, Environment, Human Rights, product, Labor relations, and Society dimensions. Content Analysis was used to measure the CSRD index. The results indicated that the general level of CSRD for Jordanian listed firms is 34.1%. The economic activities dimension is the most disclosed by the firms while the human rights dimension is the least disclosed.