Types and Motives of Corporate Social Responsibility and Environmental Reporting in Libyan Companies

Nor Asiah Mohamad ,Hafiza Aishah Hashim ,Naser Abdusalam Benomran ,Mohd Hassan Che Haat

doi:10.7575/aiac.ijfas.v.3n.1p.1

Abstract

This study examined the types and the motives of Corporate Social Responsibility and Environmental Reporting (CSER) in Libya, a developing country, which has undergone many economic, political and social changes over a short period of time. An influential factor that regulates Libyan society is Islam. Drawing from the assumption that Islamic values in business include the fair treatment of employees, fair prices, honesty, and customer service respect for environment, charitable donations, and complete disclosures, the current study aims to investigate if types and motives of CSER have been influenced by the Islamic environment in which they operate. Both quantitative and qualitative methods were employed to collect data relating to CSER in Libyan firms. The quantitative study involved analysing the contents of 162 annual company reports produced between 2006 and 2012, while the qualitative study examined the perceptions of public relations managers and financial managers, which using interviews. Results from the quantitative study revealed that annual reports issued by Libyan companies actually give social and environmental disclosure, even if it is smaller than it was expected on the basses of the Islamic background of people operating in Libyan companies. In particular, that disclosure of environmental and employee information was higher than the disclosure of community, customers and product information. The qualitative results also revealed that Islam was a significant factor in increasing CSER disclosure. In addition, the managers believed that other motives such as government ownership and company characteristics influence CSER by companies. Both quantitative and qualitative results indicated that environmental, employee and customer information features were prominent in the annual reports of Libyan companies. Keywords: Corporate Social Responsibility, Environmental Reporting, Corporate Social Responsibility and Environmental Reporting, Libya, Islam

Highlights

Libya, a key producer of high quality and low sulphur crude oil and gas, is strategically well-placed to take advantage of European markets
The customer and product categories were divided into four subcategories: product safety (38%), customer outreach (3.08%), product quality (2.5%), and antitrust (1.2%) The disclosure of employee information constituted a significant part of the Corporate Social Responsibility and Environmental Reporting (CSER) made by companies in these sectors and ranked as the most disclosed information category, while customer and community information ranked as the least disclosed information category in these sectors
These results are compatible with those reported by Mashat (2005), Elmogla (2009), and Bayoud (2012) concerning CSER disclosure in Libyan contexts, which show employee and environment information disclosed represented a significant part of the CSER in Libyan companies

Summary

Introduction

A key producer of high quality and low sulphur crude oil and gas, is strategically well-placed to take advantage of European markets. The emerging economy of Libya has experienced change over the last ten years (Mateos, 2005) and witnessed different political and economic systems (Wallace & Wilkinson, 2004). An influential factor that regulates Libyan society is Islam (Bayoud, 2012). According to Ali (1996), Islam, the dominant religion in Libya, may have an influence on firms’ disclosures. Since 2000, Corporate Social Responsibility and Environmental Reporting (CSER) has increasingly been practised in Libya, compared to previous years (Pratten & Mashat, 2009) due to the pressure from stakeholders, suggesting the growing importance of CSER in Libyan firms. Interest in CSER may further develop the concept and practice of CSER (Bayoud, 2012)

Objectives

Results

Conclusion