Abstract
New business practices are mainly characteristic of large firms, especially those quoted on the stock market. Listed companies show a higher commitment to corporate social responsibility (CSR) practices because capital markets allow activists to become a firm’s socially oriented shareholders. These actors, although small in number, have a significant influence over other larger block-holders. Recent decades have witnessed a significant increase in societal pressure to control the behavior of companies owing to the risks deriving from the economic, social and environmental effects of their business activity. The aim of this work is to test the effect that CSR activist shareholders have on the decision to disclose corporate social responsibility information in the Spanish context, controlling for the rest of the dimensions in Ullmann’s theoretical framework.
Highlights
Situations such as growing pollution, the dumping of toxic waste or the use of child labour, among others, have brought about a process of social awareness that has increased the pressure felt by firms regarding certain theoretical ethical limits that should not be breached when doing business
On analyzing the variables individually, it can be seen that the independent variable proposed, which represents the pressures exerted by active shareholders, does not affect the external assurance of the corporate social responsibility (CSR) report
In this study we posited a dependence model in an attempt to analyze the effect that activist shareholders have on a firm’s decision to disclose information on corporate social responsibility in the Spanish context, controlled by the dimensions proposed by Ullmann
Summary
Situations such as growing pollution, the dumping of toxic waste or the use of child labour, among others, have brought about a process of social awareness that has increased the pressure felt by firms regarding certain theoretical ethical limits that should not be breached when doing business This acceptable ethical threshold has meant that firms comply with legal requirements, and voluntarily tend to adopt environmental improvements in their manufacturing processes, implement environmental management systems and make it easier for their employees to conciliate their work with their personal lives. A fewer number of papers such as Roberts (1992), Liu and Anbumozhi (2009) and Prado et al (2009a), using Ullmann’s theoretical framework, have analyzed the role of these stakeholders in the process, showing that there is a limited impact of shareholder power on it
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