ARTICLE

CORPORATE SOCIAL RESPONSIBILITY DISCLOSURE FROM THE PERSPECTIVE OF FIRMS CHARACTERISTICS

  1. HOME
  2. ARTICLE

13 Pages : 117-133

http://dx.doi.org/10.31703/ger.2018(III-I).13      10.31703/ger.2018(III-I).13      Published : Jun 2018

Corporate Social Responsibility Disclosure: From the Perspective of Firm's Characteristics

Abstract

    The study analyzed the combined impact of the firm's characteristics on the level of corporate social responsibility disclosure (CSRD). Data were obtained from the annual reports, and all the available assumptions were fulfilled before running the regression models. The results show that the percentage of shares held by the foreigner shareholders, top management, number of total shareholders, and the presence of independent director has a positive relationship with the level of CSRD. In addition, the percentage of the local shareholders has shown a negative association with the level of CSRD. Nevertheless, the firm's profitability shows no significant result, negating the general perception that profitable firms involve in more corporate social responsibility (CSR) activities. Findings offer a comprehensive picture for policymakers, practitioners, and general corporate beneficiaries. This study insight that the involvement in CSR activities is sensitive to the internal corporate structure and the firm's capabilities

    Corporate Social Responsibility; CSR Disclosure; Firm's Characteristics; Content Analysis; Corporate Decision.

    (1) Maqsood Hayat
    Assistant Professor, Yunnan University of Business Management, Kunming, China.
    (2) Shehzad Khan
    Assistant Professor, Institute of Business Studies and Leadership, Abdul Wali Khan University Mardan, KP, Pakistan.
    (3) Muhammad Faizan Malik
    Assistant Professor, Institute of Business Studies and Leadership, Abdul Wali Khan University Mardan, KP, Pakistan.
Fulltext PDF

References

  • Adams, C. A., Hill, W. Y., and Roberts, C. B. (1995). Environmental, employee and ethical reporting in Europe. London: ACCA research report, 41.
  • Adams, C., & Harte, G. (1999). Towards corporate accountability for equal opportunities performance. ACCA occasional research paper no. 26. London: ACCA.
  • Adams, C.A., Coutts, A., and Harte, G. (1995). Corporate equal opportunities (non-) disclosure. The British Accounting Review, 27(2), 87-108.
  • Aguilera-Caracuel, J., and Ortiz-de-Mandojana, N. (2013). Green innovation and financial performance: an institutional approach. Organization & Environment, 26(4), 365- 385.
  • Attig, N., Boubakri, N., El Ghoul, S., and Guedhami, O. (2016). Firm internationalization and corporate social responsibility. Journal of Business Ethics. 134(2), 171-187
  • Badulescu, A., Badulescu, D., Saveanu, T. and Hatos, R. (2018). The relationship between firm size and age, and its social responsibility actions-focus on a developing country (Romania). Sustainability, 10(3), 1-21.
  • Barney, J. Firm resources and sustained competitive advantage (1991). Journal of Management, 17(1), 99-120.
  • Bear, S., Rahman, N., and Post, C. (2010). The impact of board diversity and gender composition on corporate social responsibility and firm reputation. Journal of Business Ethics, 97, 207-221.
  • Beck, C.A., Campbell, D., and Shrives, PJ (2010). Content analysis in environmental reporting research: Enrichment & rehearsal of the method in a British-German context. British Accounting Review, 42(2), 207-222.
  • Belal, A. R., and Owen, D. (2007). The views of corporate managers on the current state of, and future prospects for, social reporting in Bangladesh: An engagement-based study. Accounting, Auditing & Accountability Journal, 20(3), 472-494
  • Ben-Amar, W., Chang, M., and Mcllkenny, P. (2015). Board gender diversity and corporate response to sustainability initiatives: Evidence from the carbon disclosure project. Journal of Business Ethics,142 (2).
  • Berelson, B. L. (1952). Content analysis in communications research. New York: Free press.
  • Berrone, P., and Gomez-Mejia, L.R. (2009). Environmental performance and executive compensation: an integrated agency institutional perspective. Acad. Manage. J., 52, 103-126.
  • Bowen, H.R. (1953). Social responsibilities of businesspersons. New York: Harper & Brothers.
  • Bradbury, M. E. (1991). Characteristics of firms and voluntary interim earnings disclosure: New Zealand evidence. Pacific Accounting Review, 3(1), 37-62.
  • Carroll, A. B. (1979). A three-dimensional conceptual model of corporate performance. The Academy of Management Review, 4(4), 497-505.
  • Cash, AC (2012). Corporate social responsibility and petroleum development in subSaharan Africa: the case of Chad. Resources Policy, 37(2), 144-151
  • Chau, G., and Gray, S.J. (2010). Family ownership, board independence & voluntary disclosure: Evidence from Hong Kong. Journal of International Accounting, Auditing & Taxation, 19(2), 93-109.
  • Choi, B.B., Lee, D., and Psaros, J. (2013). An analysis of Australian company carbon emission disclosures. Pacific Accounting Review, 25(1), 58-79.
  • Choi, J. S. (1999). An investigation of the initial voluntary environmental disclosures made in Korean semi-annual financial reports. Pacific Accounting Review, 11(1), 73- 102
  • Clark, J.M. (1939). Social control of business. 2nd ed. New York: McGraw Hill.
  • Clarkson, M. (1995). A stakeholder framework for analyzing and evaluating corporate social performance. Academy of Management Review, 20(1), 92-117.
  • Cormier, D., and Gordon, I.M. (2001). An examination of social and environmental reporting strategies. Accounting, Auditing and Accountability Journal, 14(5), 587- 616
  • Cumming, D., Leung, T., and Rui, O. (2015). Gender diversity and securities fraud. Acad. Management. J., 58, 1572-1593.
  • Dyck, B., and Silvestre, D. S. (2018). Enhancing socio-ecological value creation through sustainable innovation 2.0: moving away from maximizing financial value capture. Journal of Cleaner Production, 171(1), 1593-1604.
  • Dyduch, J., and Krasodomska, J. (2017). Determinants of corporate social responsibility disclosure: an empirical study of Polish listed companies. Sustainability, 9(11), 19-34.
  • Eagly, A. H., and Carli, L. L. (2003). The female leadership advantage: An evaluation of the evidence. Leadership Quarterly, 14, 807-834.
  • Ehsan, S., Tabassum, N., Akram, Z., and Nasir, R. (2013). The role of insider & individual ownership structure in dividend payout policy: Evidence from Pakistan. MiddleEast Journal of Scientific Research, 17(9), 1316-1326.
  • Elkington, J. (1997). Cannibals with Forks: Triple Bottom Line of 21st Century Business. Oxford: Capstone Publishing Limited.
  • Eng, L. L., and Mak, Y. T. (2003). Corporate governance and voluntary disclosure. Journal of Accounting and Public Policy, 22, 325-345.
  • Ernst & Young. (2016). Value of sustainability reporting. available at: (accessed July 29, 2020). www.ey.come/us/en/services/specialty-services/climate-change-andsustainability-services/value-of-sustainability-reporting
  • Fama, E.F. (1980). Agency problems and theory of the firm. Journal of Political Economy, 88(2).
  • Forker, J.J. (1992). Corporate governance disclosure quality. Accounting and Business Research, 22(86), 111-124.
  • Friedman, M. (1970). The social responsibility of business is to Increase its profits. The New York Times Magazine, 211-227.
  • George, G., Howard-Grenville, J., Joshi, A., and Tihanyi, L. (2016). Understanding and tackling societal grand challenges through management research. Academy of Management Journal, 59(6), 1880-1895.
  • Global Reporting Initiative. (2011). G3.1 Sustainability reporting guidelines, http://www. globalreporting.org/resourcelibrary/G3.1-Sustainability-ReportingGuidelines.pdf.
  • Gray, S., Meek, G., and Roberts, B. (1995). International capital market pressures and voluntary annual report disclosures by US and UK MNEs. Journal of International Financial Management and Accounting, 6(1), 43-68.
  • Gujarati, Damodar N. (2012). Basic econometrics. New York: McGraw-Hill Education.
  • Guthrie, J., R. Petty, K. Yongvanich., and F. Ricceri. (2004). Using content analysis as a research method to inquire intellectual capital reporting. Journal of Intellectual Capital, 5(2), 282-293.
  • Hackston, D., and Milne, M. (1996). Some determinants of social & environmental disclosures in New Zealand companies. Accounting, Auditing & Accountability Journal, 9, 77-108.
  • Haniffa, R.M., and Cooke, T.E. (2002). Culture, corporate governance and disclosure in Malaysian corporations. Abacus, 38(3), 317-349.
  • Harjoto, M.A., Jo, H. (2011). Corporate governance and firm value: The impact of corporate social responsibility. Journal of Business Ethics, 103, 351-383.
  • Hassan Al-Tamimi., and Hussein A. (2014). Corporate social responsibility practices of UAE banks. Global Journal of Business Research, 8(3), 91-108.
  • Husted, B.W., and Allen, D.B. (2006). CSR in the multinational enterprise: strategic and institutional approaches. Journal of International Business Studies, 37(6), 838- 849.
  • Islam, M.A., and Deegan, C. (2008). Motivations for an organization within a developing country to report social responsibility information: evidence from Bangladesh. Accounting, Auditing and Accountability Journal, 21(6), 850-874.
  • Jamali, & Miurshak. (2007). Corporate social responsibility (CSR): Theory and practice in a developing country context. Journal of Business Ethics, 72(3), 243-262.
  • Jamali, D. (2010). The CSR of MNC subsidiaries in developing countries: global, local, substantive or diluted?. Journal of Business Ethics, 93(2), 181-200.
  • Jenkins, H. (2006). Small business champions for corporate social responsibility. Journal of Business Ethics, 67(3), 241-256.
  • Jenkins, H., and Yakovleva, N. (2006). Corporate social responsibility in the mining industry: exploring trends in social and environmental disclosure. Journal of Cleaner Production, 14(3), 271-284.
  • Jensen, M.C., and Meckling, W.H. (1976). Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(3), 305- 360.
  • Jhatial, A. A., Cornelius, N., and Wallace, J. (2014). Rhetorics and realities of management practices in Pakistan: Colonial, post-colonial and post-9/11 influences. Business History, 56(3), 456-484.
  • Jo, H., and Harjoto, M.A. (2011). Corporate governance and firm value: the impact of corporate social responsibility. Journal of Business Ethics, 103(1), 351-383.
  • Johnson, R. A., and Greening, D. W. (1999). The effects of corporate governance and institutional ownership types on corporate social performance. Academy of Management Journal, 42, 564-576.
  • Khan, M., A. Majid., M. Yasir., and M. Arshad. (2013). Corporate social responsibility and corporate reputation: A case of cement industry in Pakistan. Interdisciplinary Journal of Contemporary Research in Business, 5(1), 843-957.
  • Kock, C.J., Santalo, J., and Diestre, L. (2012). Corporate governance and the environment: what type of governance creates greener companies?. Journal of Management Studies, 49(3), 492-514.
  • Lal Joshi, P., and Gao, S.S. (2009). Multinational corporations' corporate social and environmental disclosures (CSED) on web sites. International Journal of Commerce and Management, 19(1), 27-44.
  • Lang, M.H., and Lundholm, R.J. (1993). Cross sectional determinants of analysts rating of corporate disclosure. Journal of Accounting Research, 31(2), 246-271.
  • Lucyanda, J., and Siagian, L.G. (2012). The influence of company characteristics toward corporate social responsibility disclosure. The 2012 International conference on business and management, Phuket - Thailand.
  • Madrakhimova, F.S. (2013). Evolution of the concept and definition of corporate social responsibility. Global Conference on Business and Finance Proceedings. 113- 118.
  • Manchiraju, H., and Rajgopal, S. (2015). Does CSR create shareholder value? Exogenous shock-based evidence from the Indian companies Act 2013. Indian School of Business Research Paper Series.
  • McGuire, J., Sundgren, A., and Schneeweis, T. (1988). Corporate social responsibility and firm financial performance. The Academy of Management Journal, 31(4), 854- 872.
  • McWilliams, A., and Siegel, D. (2001). Corporate social responsibility: a theory of the firm perspective. Academy of Management Review, 26(1), 117-127.
  • Mehar, A. (2005). Impacts of equity financing on liquidity position of a firm. Applied Financial Economics, 15(6), 425-438.
  • Neu, D., Warsame, H., & Pedwell, K. (1998). Managing public impressions: Environmental disclosures in annual reports. Accounting, Organizations and Society, 23(3), 265-282
  • Neuman, W. (2003). Social research methods: Qualitative & quantitative approaches. Boston, MA: Allyn & Bacon.
  • O'Reilly, Charles A., and Tushman, Michael L. (2011). Organizational ambidexterity in action: How managers explore and exploit. California Management Review, 53, 1-18.
  • Oh, W. Y., and Chang, Y. K. (2011). The effect of ownership structure on corporate social responsibility: empirical evidence from Korea. Journal of Business Ethics, 104, 283-297.
  • Ong, T., and Djajadikerta, H.G. (2018). Corporate governance and sustainability reporting in the Australian resources industry: an empirical analysis. Social Responsibility Journal, 16(1), 1-14.
  • Ong, T., Trireksani, T., and Djajadikerta, H.G. (2016). Hard and soft sustainability disclosures: Australia's resources industry. Accounting Research Journal, 29(2), 198-217.
  • Perera, O. (2008). How material is ISO 26000 social responsibility to small and mediumsized enterprises?. International Institute for Sustainable Development: Winnipeg, MB, Canada.
  • Perez-Batres, Luis A., Jonathan. Doh, Van V. Miller and Michael J. Pisani. (2012). Stakeholder pressures as determinants of CSR strategic choice: Why do firms choose symbolic versus substantive self-regulatory codes of conduct?. Journal of Business Ethics, 110, 157-172.
  • Platonova, E., Asutay, M., Dixon, R. and Mohammad, S. (2018). The impact of corporate social responsibility disclosure on financial performance: evidence from the GCC Islamic banking sector. Journal of Business Ethics, 151(2), 451-471.
  • Salehi, M., Tarighi, H., and Rezanezhad, M. (2017). The relationship between board of directors' structure and company ownership with corporate social responsibility disclosure: Iranian angle. Humanomics, 33(4), 398-418.
  • Syed, M.A., and Butt, SA (2017). Financial and non-financial determinants of corporate social responsibility: empirical evidence from Pakistan. Social Responsibility Journal, 13(4), 780-797.
  • Wernerfelt, B. (1984). A resource-based view of the firm. Strategic Management Journal, 5(2), 171-80.
  • Yoshikawa, T., Rasheed, A. A., and Del Brio, E. B. (2010). The impact of firm strategy and foreign ownership on executive bonus compensation in Japanese firms. Journal of Business Research, 63, 1254-1260.
  • Zahra, S.A., Oviatt, B.M., and Minyard, K. (1993). Efforts of corporate ownership and board structure on corporate social responsibility and financial performance. Academy of Management Best Paper Proceedings, Atlanta, GA, 336-340.
  • Zellweger, T.M., Nason, R.S., Nordqvist, M., and Brush, C.G. (2013). Why do family firms strive for non-financial goals? An organizational identity perspective. Entrepreneurship: Theory and Practice, 37(2), 229-248.
  • Zhang, J., Djajadikerta, H.G., and Zhang, Z. (2018). Does sustainability engagement affect stock return volatility? Evidence from the Chinese financial market. Sustainability, 10, 33-61.

Cite this article

APA

    APA : Hayat, M., Khan, S., & Malik, M. F. (2018). Corporate Social Responsibility Disclosure: From the Perspective of Firm's Characteristics. Global Economics Review, III(I), 117-133. https://doi.org/10.31703/ger.2018(III-I).13

CHICAGO

    CHICAGO : Hayat, Maqsood, Shehzad Khan, and Muhammad Faizan Malik. 2018. "Corporate Social Responsibility Disclosure: From the Perspective of Firm's Characteristics." Global Economics Review, III (I): 117-133 doi: 10.31703/ger.2018(III-I).13

HARVARD

    HARVARD : HAYAT, M., KHAN, S. & MALIK, M. F. 2018. Corporate Social Responsibility Disclosure: From the Perspective of Firm's Characteristics. Global Economics Review, III, 117-133.

MHRA

    MHRA : Hayat, Maqsood, Shehzad Khan, and Muhammad Faizan Malik. 2018. "Corporate Social Responsibility Disclosure: From the Perspective of Firm's Characteristics." Global Economics Review, III: 117-133

MLA

    MLA : Hayat, Maqsood, Shehzad Khan, and Muhammad Faizan Malik. "Corporate Social Responsibility Disclosure: From the Perspective of Firm's Characteristics." Global Economics Review, III.I (2018): 117-133 Print.

OXFORD

    OXFORD : Hayat, Maqsood, Khan, Shehzad, and Malik, Muhammad Faizan (2018), "Corporate Social Responsibility Disclosure: From the Perspective of Firm's Characteristics", Global Economics Review, III (I), 117-133

TURABIAN

    TURABIAN : Hayat, Maqsood, Shehzad Khan, and Muhammad Faizan Malik. "Corporate Social Responsibility Disclosure: From the Perspective of Firm's Characteristics." Global Economics Review III, no. I (2018): 117-133. https://doi.org/10.31703/ger.2018(III-I).13