Corporate Social Responsibility Disclosure In Annual Reports Research Articles

Comprehensive board composition and corporate social responsibility disclosure: a case of Jordan before and after the Arab Spring crisis

PurposeThe purpose of this paper is to examine the impact of social movements engendered by the Arab Spring crisis on the relationship between corporate social responsibility disclosure (CSRD) and corporate governance attributes, particularly board composition, considering the importance of governance after the Arab Spring event.Design/methodology/approachContent analysis was used to examine the extent and nature of CSRD in annual reports of Jordanian companies listed on the Amman Stock Exchange covering the period 2009–2016. A dynamic regression model using panel data is then undertaken for a sample of 114 listed companies over the period to analyse the potential impact of board composition on the level of CSRD.FindingsThe results reveal that there was a significant increase in the level of CSRD post-the Arab Spring crisis; and that governance appears to be a key driver. Specifically, board age, directors educated in business and/or accounting-related fields and foreign members are found to have a significant positive relationship with CSRD.Originality/valueLooking at the Arab region pre- and after the Arab Spring helps to complete the global picture of how company governance can lead to improved CSR performance. Specifically, this region has been behind in developing rules and codes that include CSR. The results show that having a diverse board, with directors with expertise specific to the context, increases the effectiveness of stakeholder management through CSRD. The results, therefore, offer valuable insights for companies, policymakers and for the development of regulations.

Corporate Social Responsibility Disclosure and Corporate Governance in Malaysian Listed Firms

The goal of this study is to assess whether there has been a change in the degree of corporate social responsibility (CSR) disclosure and whether corporate governance qualities impact CSR disclosure in Malaysian listed businesses' corporate annual reports. The annual reports of 91 Bursa Malaysia-listed firms were analysed using qualitative content analysis during an eight-year period (2014-2021). Regression analysis was used to discover parameters impacting CSR disclosure in annual reports. The regression analysis found that the availability of external auditors and board independence were linearly and statistically linked with the level of CSR disclosure, as expected. The regression model yielded an R2 of 81.34 percent, indicating that the CSR scoring measures explain for about 81 percent of the variance in corporate governance score, with the remaining 19 percent caused or influenced by other variables. This article is one of the few studies that investigate CSR disclosure and corporate governance qualities among Malaysia-listed firms following the government's adoption of many new CSR initiatives over the last decade.

Corporate Social Responsibility Disclosure Quality and Quantity and Its Effect on Firm Value in Ghana

This study investigates the nature of Corporate Social Responsibility Disclosure (CSRD), the location of CSRD in annual reports, and identifies sectors that disclose more CSRD information among listed firms in Ghana. The study also investigated the quality and quantity of CSRD with its consequence in terms of quality and quantity of the impact on firm value. The study sampled 33 listed firms over 10 years, from 2011 to 2020. Data were analyzed using descriptive statistics, correlation analysis, and panel regression analysis. The results of the study showed the weak relationship between the quality and quantity of CSRD. Regarding the nature of CSRD, community information was disclosed more often than any other category of information was. In addition, this research study demonstrated that a separate section for CSRD information was much preferred. Further, the financial sector disclosed more CSRD information than any of the other sectors did. On the consequences of CSRD, the results showed no significant impact of CSRD on firm value in terms of either quality or quantity of CSRD. The results suggest that investors in Ghana do not pay attention to the quality and quantity of firms’ CSRD in making their investment decisions.

Pengaruh CSR dan GCG Terhadap Profitabilitas

The objective of this study is to analyze the effect of Corporate Social Responsibility (CSR) and Good Corporate Governance (GCG) on profitability. The research was conducted on manufacturing companies listed on the Indonesia Stock Exchange (IDX) in 2017-2019. This study used purposive sampling to determine the study sample, which resulted in 103 companies as the sample obtained. Data were obtained from annual reports and/or CSR reports published on the IDX website www.idx.co.id. The results of data analysis based on Partial Least Square indicated that CSR had no effect on profitability while GCG was found to have effect on profitability. Theoretically, this study confirms previous studies and Agency Theory in terms of the importance of GCG's role in the management of companies to reduce agency problems between investors as principals and managers as agents. In addition, the research implies that manufacturing companies in Indonesia have not fully implemented CSR as can be seen from CSR disclosures in annual reports or separate CSR reports, so as not to affect profitability. Meanwhile, the result of the study implies that the GCG in manufacturing companies has been implemented adequately so that it can affect the profitability of the company.

Does CSR disclosure influence financial performance of firms? Evidence from an emerging economy

PurposeThis study aims to empirically examine the relationship between corporate social responsibility disclosure (CSRD) and financial performance (FP) in Indian firms.Design/methodology/approachData for CSRD is collected by conducting content analysis of CSRD in annual reports of the sampled firms. A multidimensional measure of CSRD is constructed based on the stakeholder theory, consisting of six stakeholder groups – employees, customers, investors, community, environment and others. The aggregate CSRD measure is created by combining disclosure of the six CSR dimensions. Multiple regression analysis is used to examine the CSRD–FP linkage, controlling for the confounding effects of size, risk, age, industry, ownership and period.FindingsThe results of this study indicate that the aggregate CSRD measures, both for quality and quantity, have a positive association with the accounting measures of firms’ FP. However, the market measure of FP is observed to have a statistically insignificant association with aggregate quality and quantity of CSRD of Indian firms.Practical implicationsThe results reveal that adopting transparent and extensive CSRD is relevant for the profitability of firms, and that government interventions are required to promote CSR programs, with a specific focus on the CSR dimensions that provide no apparent financial gains.Social implicationsThis study recommends the adoption and reporting of CSR practices by Indian firms for their stakeholders.Originality/valueThis study contributes to the scarce literature on the CSRD–FP linkage in the context of emerging economies by using a more inclusive data set, creating a reliable measure of CSRD applicable to a large universe of firms and including relevant control variables that affect the CSRD–FP relationship.

Does the adoption of AAOIFI affect corporate social responsibility disclosure? Evidence from Islamic banks

In this study, we have investigated the impact of the implementation of AAOIFI (Accounting and Auditing Organization of Islamic Financial Institutions) on the level of corporate social responsibility disclosures (CSRD) within the context of Islamic banks. We measured the level of CSRD in annual reports using a disclosure instrument based on AAOIFI governance standard and other indexes from the previous studies. We have used data of 36 Islamic banks that was located in the Gulf Cooperation Council (GCC) between 2012 and 2016. We found out that AAOIFI adoption had a positive effect on CSRD. Furthermore, this paper - is the first one that has investigated to what extent adoption of financial accounting standards as AAOIFI can enhance the level of CSRD in Islamic banks. We contributed for the debate and literature about the economic consequences of adoption financial accounting standards specifically for Islamic

Corporate social responsibility disclosure and financial information environment

This study aims to explore whether or not social responsibility disclosure contributes to improve the financial information environment, through examining the impact of quantity and quality of corporate social responsibility (CSR) disclosure on the accuracy of analysts' forecasts and audit fees. Content analysis technique has been used to measure quantity and quality of CSR disclosure in annual reports of Saudi registered companies. OLS regression model is used to examine the relationship between the quantity and quality of CSR disclosure in the annual reports and the quality of the analysts' forecasts, and the audit fees. The results indicated that CSR disclosure provides useful information for outsiders, where it is associated with more accurate analysts’ expectations and reduced audit fees. These results suggest that CSR disclosure is associated with high quality financial information environment. This paper provides comprehensive analysis for financial information environment in Saudi companies. The findings of paper provide useful insights concerning the importance of social responsibility disclosure in Saudi business environment.

The impact of board gender diversity on corporate social responsibility in the Arab Gulf states

PurposeThis study aims to examine the impact of board gender diversity on the level of corporate social responsibility (CSR) disclosure in the Arab Gulf states. Also, this research further aims to explore whether the impact of board gender diversity varies across the Arab Gulf states.Design/methodology/approachOrdinary least squares regression is used in this study to test the impact of board gender diversity on the level of CSR disclosure. Manual content analysis is used to evaluate the extent of CSR disclosure in annual reports, stand-alone CSR reports, sustainability reports and website sections to examine the relationship between the extent of CSR reporting and board gender diversity. This study uses the global reporting initiative (GRI) fourth version reporting guidelines to design and define the classifications of CSR reporting checklist.FindingsThe findings show that there is a statistically significant relationship between the number of female directors and the level of CSR disclosure. The results show that board gender diversity is positively associated with the level of CSR reporting in two countries, namely, Bahrain and Kuwait. Also, the findings reveal that there is a weak positive relationship between the presence of women on the boards and CSR reporting index in Oman, Qatar, Saudi Arabia and the UAE.Originality/valueThis study attempts to fill the gap in the literature, in that no similar study covers the Arab Gulf countries as one economic unit. The study is unique in that it focuses on oil-rich countries. This study is, to the best of this researcher’s knowledge, the first to explore the impact of women’s boards on the extent of CSR reporting, as well as investigating the possible variation of board gender diversity impact on the extent of CSR reporting in the Arabian Gulf region.

The Impact of Audit Committee Characteristics on CSR Disclosure: An Analysis of Australian Firms

AbstractThis study examines the influence of audit committee (AC) characteristics on voluntary corporate social responsibility (CSR) disclosure in the corporate annual reports of Australian listed firms. It develops hypotheses about the relationship between voluntary CSR disclosure and AC characteristics such as size, frequency of meetings, independence, independent chair, financial expertise and gender diversity. Using multiple regression analysis on data collected from the corporate annual reports of 300 listed firms, the study finds that AC characteristics such as size, frequency of meetings, committee independence and gender diversity have a significant positive influence on the level of CSR disclosure. However, there is no evidence that AC characteristics such as independent chair and members’ financial expertise affect CSR disclosure in Australian firms. Based on an additional analysis, the study also sheds some light on the effect of AC characteristics on environmental disclosure. The findings of this study may be of particular interest to regulators, shareholders, investment analysts and managers in assessing CSR disclosure in annual reports, and in strengthening the monitoring and oversight role of ACs.

Corporate social responsibility and corporate governance in Indonesian public listed companies

This study aims to investigate whether theree has been a change in the level of corporate social responsibility (CSR) disclosure and to examine whether corporate governance attributes influence CSR disclosure in corporate annual report of Indonesian public listed companies(PLCs). The annual reports of 115 PLC for two years (2011 and 2012) were analysed using content analysis. Multiple regression analysis was utilized to determine factors influencing CSR disclosure in annual reports. Consistent with expectations, the paired sample t-test showed that there was an increase (significant at the 1 percent level) in the extent of CSR disclosure. The multiple regression analysis revealed that audit committee effectiveness and company’s size were positively associated with the extent of CSR disclosure (significant at 5 per cent level). The findings appear to suggest that The Indonesian Capital Market and Financial Institutions Supervisory Agency (Bapepam LK) effforts in promoting CSR through the release of Regulation No X.K.6 in 2012 have had some positive impact on CSR disclosure in annual report. The results also suggest that the involvement of audit committee through its effectiveness in overseeing company’s financial reporting could lead to better concern in corporate social activities and hence disclosure in annual reports. This study however, has limitation that should be considered in interpreting the results. The regression model documented an R2 of 21.4 percent, which indicates that almost 80 percent of factors influencing CSR disclosure in Indonesian PLC have not been captured by the model. These other factors may perhaps be indentified in the next research.

Board diversity and CSR reporting: an Australian study

PurposeThis paper aims to examine the relationship between corporate governance, in particular board diversity, and corporate social responsibility (CSR) reporting among the top 150 listed companies in Australia over a three-year period.Design/methodology/approachThe quantitative analysis involving a longitudinal study is used where content analysis is undertaken to analyse the extent of CSR disclosures in annual reports. Regression analysis using panel data is used to analyse the potential association between CSR disclosure and five important board diversity measures, specifically independence, tenure, gender, multiple directorships and overall diversity measure.FindingsThe results based on the regression analysis reveal that three of the board diversity attributes (gender, tenure and multiple directorships) and the overall diversity measure have the potential to influence CSR reporting. The relationship between independent/non-executive directors and CSR disclosure however is unclear. In addition, three of the control variables (firm size, industry and CEO duality) are found to have some influence on CSR disclosure, whereas board size and profitability are found to be insignificant. The results also indicate the existence of some possible interaction effects between gender and multiple directorships.Originality/valueThe paper has implications for companies, for policymakers and for the professional development needs of board members. Australian companies should consider identifying board attributes that enhance CSR disclosures, as it has been shown in previous studies that CSR disclosure in Australia is low when compared to other developed countries. Moreover, given that there is such limited research linking board diversity and CSR disclosure, the results of this paper provide scope for further research. Moreover the paper contributes to the existing literature on board composition and CSR disclosure by extending the literature to board diversity and provides preliminary evidence of the influence of board diversity on CSR disclosure in Australia.

Do Firm Size and Financial Performance Affect Corporate Social Responsibility Disclosure: Employees’ and Environmental Dimensions?

The paper empirically tests the impact of company size and financial performance on Corporate Social Responsibility Disclosure (CSRD), from the Employees' and Environmental Dimensions perspective with reference to the disclosure frequency and quality of these dimensions among Jordanian industrial public share holding companies; whether there is an impact of firm size measured by total assets, ROA, ROE and Leverage on Corporate Social Responsibility Disclosures levels toward employees’ dimension (CSRD1) and the environmental activities Dimension (CSRD2) in the Jordanian public industrial firms. The paper analysis is based on contents disclosed in their annual reports for 2013. The study applies suggested CSRD checklist for measuring the extent of CSRD in annual reports of these companies. Regression analysis is used to examine this issue. This study describes from theoretical point-of-view, social responsibility activities, as well as some financial performance, and firm size. Then, an empirical review is gained of reports published by a representative sample from the industrial sector. An attempt has been made to verify if there is a correlation between CSRD1, CSRD2 contents disclosed, financial performance; profitability, Leverage and size. The paper found solid evidence to accept positive significant influence of company size on both types of CSRD dimensions; employees and the environment. It found a negative significant impact of leverage on CSRD -both employees and environment- dimensions. However, the study showed a positive significant impact of operating performance measured by Return on Assets (ROA) for the sample on CSRD towards employees dimension only, the impact of ROA on CSRD towards the environmental dimension is positive and insignificant. The impact of ROE has negative insignificant on CSRD towards employees. Consequently, it showed Positive insignificant impact of ROE on CSRD towards environmental dimension. This paper opens a new research path in CSRD, financial performance and size, for a possible link between both variables; a matter that has not been previously explored in Jordanian Industrial Public Shareholding Companies.

The effect of award on CSR disclosures in annual reports of Malaysian PLCs

Purpose– The paper aims to examine the determinants of corporate social responsibility (CSR) disclosures in the annual reports of Malaysian public listed companies (PLCs). In 2006, Bursa Malaysia Berhad (BMB) launched its CSR Framework (effective in 2007) which is supposed to guide the Malaysian PLCs’ CSR disclosures. It is believed that this CSR framework may influence CSR disclosures to be more systematic, yet there is no evidence whether this framework influences the extent and quality of CSR disclosures. Thus, this study examines this area of research. The study also tests the influence of award on CSR disclosures.Design/methodology/approach– CSR disclosure checklist was developed to analyse the extent and quality of CSR information disclosures in the year 2008 annual reports of the Malaysian PLCs.Findings– Malaysian PLCs disclose more CSR information related to community and environment than workplace and marketplace CSR themes. On the other hand, the quality of disclosure practices was minimal when it is compared to the extent of disclosure practices. Finally, the study also found that the award’s variable has a significant positive relationship with both the extent and quality of CSR disclosure practices of the Malaysian PLCs.Research limitations/implications– The recently developed BMB’s CSR framework seems to have impact on the level and systematic CSR reporting practices of Malaysian PLCs. However, the quality of CSR disclosures is considered minimal.Practical implications– The results of the study bring some practical implications to the regulators, particularly Bursa Malaysia. First, it is good to observe that most companies have practiced specific disclosure in a separate statement with regard to CSR. However, the format of presentation and the extent of disclosure vary among the firms. Second, further guidelines need to be developed to provide a clearer framework of disclosure for CSR information. At the moment, Bursa Malaysia only listed down general principles of CSR themes. In addition, the regulators should also look into the evolving issues in CSR, such as the issue of climate change reporting. For example, the Climate Disclosure Standards Board has issued a voluntary Climate Change Reporting Framework.Originality/value– This study examined both the traditional (i.e. firm size and profitability) and non-traditional (i.e. award) factors influencing management’s decision to disclose CSR information in the annual reports of the Malaysian PLCs. Furthermore, the study reported how Malaysian PLCs comply with the recently implemented CSR framework issued by BMB.

Corporate social responsibility and corporate governance in Malaysian government‐linked companies

PurposeThe purpose of this paper is to investigate whether there has been a change in the level of corporate social responsibility (CSR) disclosure and to determine whether corporate governance attributes influence CSR disclosure in corporate annual reports of Malaysian government‐linked companies (GLCs).Design/methodology/approachThe annual reports of 27 GLCs for two years (2005 and 2007) were analysed using content analysis. Multiple regression analysis was performed to identify factors influencing CSR disclosure in annual reports.FindingsConsistent with expectations, the paired‐sample t‐tests showed that there was an increase (significant at the 1 percent level) in the extent of CSR disclosure. The multiple regression analysis revealed that board size was positively associated and statistically significant (at the 1 percent level) with the extent of CSR disclosure.Research limitations/implicationsThe regression model reported an R2 of 33.9 percent, which means that almost 66 percent of factors influencing CSR disclosure in Malaysian GLCs have not been captured by the model. These other factors may perhaps be identified through other research methods such as questionnaire surveys or interviews.Practical implicationsThe findings appear to suggest that the government efforts in promoting CSR among GLCs through the introduction of the Silver Book in 2006 have had some positive impact on CSR disclosure in annual reports. The results also imply that larger board size through wider exchange of ideas and experience could lead to better appreciation and involvement in corporate social activities and hence disclosure in annual reports.Originality/valueThis paper is one of the few studies to examine CSR disclosure and corporate governance attributes in GLCs after the introduction of new initiatives to promote CSR.

Ownership structure and corporate social responsibility disclosure: some Malaysian evidence

PurposeThe purpose of this article is to examine the influence of ownership structure on corporate social responsibility (CSR) disclosure in Malaysian company annual reports (CARs).Design/methodology/approachThe study uses a CSR disclosure checklist to measure the extent of CSR disclosure in annual reports and a multiple regression analysis to examine the association between ownership structure and the extent of CSR disclosure in annual reports.FindingsThe paper finds that, even among the larger and actively traded stocks in Malaysia, there is considerable variability in the amount of social activities disclosed in corporate annual reports. Results from multiple regression analysis show that, consistent with expectations, companies in which the directors hold a higher proportion of equity shares (owner‐managed companies) disclosed significantly less CSR information, while companies in which the government is a substantial shareholder disclosed significantly more CSR information in their annual reports.Research limitations/implicationsThe sample for this study comes from larger and actively traded stocks on the Bursa Malaysia. Thus, the results may not be generalizable to smaller and less actively traded stocks.Practical implicationsThe findings appear to suggest that the level of CSR disclosure in annual reports of companies depends on the extent of “public pressure” faced by each company. The results also raise the question of whether corporate involvement in social activities should be made a mandatory disclosure in annual reports to better assess the extent of “corporate citizenship” of Malaysian companies.Originality/valueThe study finds that ownership structure, which had been ignored in prior studies on factors influencing CSR disclosure, has an impact on CSR disclosure.