Abstract
This study aims to comparatively assess the effects of company-specific variables on the level of corporate social responsibility (CSR) information disclosed in publicly-traded companies from United Kingdom (UK) and Malaysia. Content analysis was applied to sampled reports from the FTSE 100 Index and FTSE Bursa KLCI against inferred meanings from the Global Reporting Initiative (GRI)-derived coding base to identify similarities and/or differences in CSR disclosure practices. The Spearman’s correlation coefficients and multiple linear regressions (MLR) analyses further gauged the associations between the variables and total quantity of CSR disclosure (TQCSR ); and, determined the predictive determinants on sustainability reporting.The Spearman’s correlation has identified a negative association on leverage with TQCSR for UK companies. In contrast, the TQCSR in the Malaysian sample was positively associated with directors’ CSR-related experiences and profitability but negatively associated with company size. Results from MLR analyses presented company size as a significant determinant on sustainability reporting in the UK model, while directors’ experiences were indicated as the crucial determinant in the Malaysian model. This first, direct cross-market sustainability reporting study highlights the importance of board of directors’ CSR-relevant experience in influencing the level of CSR disclosures in publicly-traded companies.
Highlights
Sustainability reporting has emerged as a powerful tool in gaining long term business growth and competitive advantage
Content analysis Based on the data compiled for SCOREECN, SCOREEVN and SCORESOC, the maximum binary scores for the economic, environment and social indicator were 14, 25 and 38 respectively
In United Kingdom (UK), the highest score of total quantity of CSR disclosure (TQCSR) was reported by Diageo (Consumer Goods) at 0.96, while the lowest was at 0.48 from Shire (Health Care)
Summary
Sustainability reporting has emerged as a powerful tool in gaining long term business growth and competitive advantage. The practice to report high quality non-financial data beyond the financial bottom line helps companies to mitigate potentially material financial impact of environmental and social risk in their businesses. This study intends to juxtapose the sustainability reporting agenda of publicly-traded companies from the United Kingdom (UK) and Malaysia. While there are substantial empirical researches on the determinants of CSR disclosure practice internationally, crossmarket comparison on sustainability reporting activities were scarce and mainly explored the macro-effect of country-level variables and political-legal systems (Ioannou and Serafeim, 2016; Anderson and Gupta, 2009; La Porta et al, 2008). In order to better understand the readiness of Malaysian companies in pursuing the CSR agenda, a comprehensive comparative study against a developed CSR reporting regime such as the UK is necessary
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