Abstract
Although several studies have analyzed the role that specific corporate governance mechanisms have on Corporate Social Responsibility (CSR) reporting practices, their findings have not been conclusive and the evidence from developing countries is scarce. The theoretical support for this relationship in the previous literature is found in Stakeholder, Agency, Legitimacy, and Good Management theories. Undoubtedly, as the institutional environment has an important impact on CSR reporting practices, it would be relevant for this field of research to analyze this relationship in companies from emerging countries. It is suggested for the sake of convenience to consider different levels of corporate governance mechanisms together due to the high interdependence among them. Consequently, the aim of this paper is to analyze whether different levels of corporate governance mechanisms (at the institutional, group, and firm level) are determinant factors of the CSR reporting practices in BRICS countries (Brazil, Russia, India, China, and South Africa). The final sample was composed of 281 companies. On the basis of our results, we conclude that institutional corporate governance mechanisms influence the company’s CSR reporting strategy and that both CSR disclosure practices analyzed are affected by group-level corporate governance mechanisms in companies from family-based societies. Our findings support the appropriateness of separately analyzing this issue in emerging countries.
Highlights
Due to the large number of cases of negligence, corruption, and bad praxis uncovered over the last 10 years and their significant impact from an economic, social, and environmental perspective, Corporate Social Responsibility (CSR) is receiving increasingly more attention from academics, professionals, and society in general [1]
The sample used is composed of listed companies located in BRICS countries, whose corporate governance (CG) and financial data were available in the ASSET4 Thomson Reuters database and whose CSR reports could be read
On the other hand, considering only those companies that publish some kind of report (81.9%; 230 out of the 281 companies in the sample), it was observed that those which prepare the report following the GRI guidelines were less (99) than those which did not follow this standard (131). This result suggests that the GRI standards are not used as much by companies in BRICS countries as in developed countries since, according to KMPG [103] in 2013, they are used in 74% of the CSR reports around the world
Summary
Due to the large number of cases of negligence, corruption, and bad praxis uncovered over the last 10 years and their significant impact from an economic, social, and environmental perspective, Corporate Social Responsibility (CSR) is receiving increasingly more attention from academics, professionals, and society in general [1]. Most of these articles analyze this relationship from a one-level approach, some researchers [20] recommended studying this question from a multi-level approach in order to be able to identify interdependences between multiple mechanisms For these two authors, some of the CG variables selected by researchers as determinants of social performance are often interrelated and can have a compound effect despite belonging to different corporate levels (institutional, firm, group, or individual levels). Based on the information of CSR reports from the companies of emerging countries, the aim of this study is to analyze how different levels of CG mechanisms affect companies’ CSR reporting strategies in the context of emerging countries Considering these arguments, the study focuses on companies from BRICS nations (Brazil, Russia, India, China, and South Africa).
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