Factors Influencing Corporate Social Responsibility Disclosure and Its Impact on Financial Performance: The Case of Vietnam

Thanh Hung Nguyen,Quang Trong Vu,Duc Minh Nguyen,Hoang Long Le

doi:10.3390/su13158197

Abstract

The study examines the impact of company size, industry sensitivity, government ownership, liquidity and company age on Corporate Social Responsibility Disclosure (CSRD) in 2019 annual reports of listed companies on the Vietnam stock market. We also consider the relationship between CSRD and the financial performance measured by return on assets (ROA) and return on equity (ROE). This study uses descriptive statistics and regression methods to test research hypotheses. The empirical findings show that company characteristics, including firm size, liquidity, government ownership and environmental industry sensitivity, are positively associated with firms’ CSRD level. Firm age does not influence the CSRD of listed companies. The CSRD significantly affects both ROA and ROE. Our study provides several suggestions to promote the CSR information disclosure of listed companies and enhance their social responsibility for sustainable development.

Highlights

In recent years, businesses’ role and social responsibilities are emerging issues recognized by the community
The findings showed that corporate social responsibility (CSR) information disclosure is related to the industry sector
This study examines whether the company size, industry sensitivity, government ownership, liquidity and company age key drivers of Corporate Social Responsibility Disclosure (CSRD) among Vietnamese listed enterprises

Summary

Introduction

Businesses’ role and social responsibilities are emerging issues recognized by the community. Businesses that contribute to development are often criticized for being the cause of social problems [1]. The requirement for a full report of social problems such as pollution, waste and depletion of natural resources, quality of products and employees’ rights and status in large companies has increased dramatically. Companies have started to participate in corporate social responsibility (CSR) activities and publish information about them. Many large and older companies, in particular, spend a massive amount of money on disclosing information about their CSR activities.

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Conclusion