Quality Of Corporate Social Responsibility Reports Research Articles

The credibility of corporate social responsibility reports: evidence from the energy sector in emerging markets

PurposeThis study aims to explore the underlying motivation of companies in the energy sector for publishing corporate social responsibility (CSR) reports; is it to inform about their strong corporate social performances (CSP) or to seem as committed to CSR matters although they are not?Design/methodology/approachThe panel data of the energy and energy utility companies from the Brazil, Russia, India and China (BRIC) countries were analysed by panel logistic and panel ordered logistic regression methods.FindingsThe main results based on the panel data analyses of the energy and energy utility companies from the BRIC countries reveal that publishing a CSR report as per an international framework, Global Reporting Initiative framework for this study, is a signal for a strong CSP. The results also show that the quality of CSR reports is positively associated with the CSP of the companies.Practical implicationsThe positive correlation between the existence and quality of CSR reports and CSP identified in this study provides evidence for the credibility of CSR reports and hence forms the basis for the suggestion of the usage of CSR report as a reliable tool to assess the sustainability of the energy sector and emerging markets as well.Originality/valueThis study contributes to the limited literature on the nexus between CSR reporting and CSP for environmentally sensitive industries in emerging markets and enriches the knowledge by investigating overall CSP as well as its three pillars, namely, environmental, social and governance performance.

Disclosure Levels and Quality of Environmental Indicators of CSR Reports of Developers

<p>永續是當前全球性議題，公司提出企業社會責任(Corporate social responsibility, CSR)報告書，揭露環境、經濟、社會三面向之永續績效及作為。台灣自2014年開始，符合條件的建設公司被規定要編製CSR報告書，但文獻指出，CSR報告書揭露的內容與品質有所不足。 本研究探討CSR報告書中環境面的內容，依全球報告綱領(Global Reporting Initiative, GRI)的要求，分析台灣建設公司的CSR報告書之環境指標的揭露程度、品質原則遵循程度，以及兩者之相關性。選取上市(櫃)營收前六大建設公司為個案研究。研究結果發現，環境指標揭露程度不高且揭露的質、量不一致；品質原則遵循為中等程度，時效性遵循程度最高，可靠性最低；環境指標揭露程度與品質遵循呈現低度正相關。 建設公司可依GRI準則的指標要求項目，發展環境管理方針，輔助提高報告書的揭露深度與品質。另外，運用外部認證的報告書，可提高可靠性、增加公信力，符合金管單位的政策。</p> <p> </p><p>Sustainability is a current global issue. Companies have published CSR (corporate social responsibility) reports to disclose sustainable performances and actions in economic, environmental, and social aspects. In Taiwan, the qualified listed companies including developers have been required to compile CSR reports since 2014. However, literature points out that the disclosure and quality of CSR reports are not adequate. The objective of this research was to examine the environmental contents of CSR reports. Based on the 2016 GRI (Global Reporting Initiative) Standards, this study analyzed the disclosure levels and quality compliance degree of the 30 environmental indicators and the relationship between the two. Six listed developers with the largest revenues were chosen as cases to study. The results show that the disclosure levels of environmental indicators were not high and the disclosure levels and numbers of environmental indicators were not consistent. In the quality principles, timeliness is the most compliant one but reliability is the last. The disclosure levels and quality compliance show a low positive relationship. Based on the requirements of GRI Standards, developers can establish their own environmental management approaches, which can help raise both disclosure levels and quality of the reports. Further, a CSR report with external assurance can strengthen its reliability, increase public trust and meet the government policy.</p> <p> </p>

Does Capital Market Distrust CSR Reporting? Economic Benefits in Presence of Complementary Monitoring Mechanism

From a theoretical point of view, corporate social responsibility (CSR) disclosure actions have associated a large list of benefits as a result of the lower information asymmetry problems that provoke firms to enjoy better financial conditions and higher market value. However, empirically there is no unanimity in the academy about these positive impacts. In this paper, we consider that the possible discretionary decision that managers could have in the elaboration of CSR reporting implies distrust about the credibility and utility of sustainability information. In this regard, the presence of independence in boards and directors that ensure better control of management decision could moderate the relationship between the quality of CSR reports and their benefits. Independent directors, in their decision-making process, associate their personal image, reputation, and career with CSR disclosures. For an international sample of analysis, our empirical evidence supports the premise that the market only positively assesses the utility and comparability of corporate social responsibility information, giving firms a superior value when there is a complementary mechanism that guarantees information credibility.

When Does Corporate Social Responsibility Disclosure Affect Investment Efficiency? A New Answer to an Old Question

Prior evidence that firm’s investment behavior is positively affected by its corporate social responsibility (CSR) disclosure, as one of the key CSR areas of the company, leaves unaddressed whether all kinds of disclosure have the same effect. Drawing on stakeholder theory, this study analyzes the issue in a more exhaustive way. A cross-sectional logistic regression model is used to test the hypothesized association, and the results imply that firms’ high (low)-quality disclosure regarding their engagement in CSR activities increases their chances of being from the investment-efficient (inefficient) group. The obtained results conclude that CSR reporting activity is not beneficial for companies unless a meaningful disclosure of sustainability information is made. Our results are robust to using alternative proxies for CSR disclosure quality. This study contributes to the scarce evidence on CSR reporting in Pakistan and provides a useful method for assessing quality of CSR reports.

Media coverage and impression management in corporate social responsibility reports

PurposeBecause corporate social responsibility (CSR) reports in China are surging in quantity but are low in quality, impression management in CSR reports has become a hot research topic in recent years. This paper aims to research whether and how media coverage affects CSR report impression management and whether CSR report disclosure attributes have different regulating effects.Design/methodology/approachBased on the effective supervision hypothesis and the market pressure hypothesis, this study uses Heckman’s two-stage regression model to examine the effect of media coverage on CSR report impression management from the perspective of managers’ self-interest.FindingsThe results support the market pressure hypothesis, which suggest that firms with higher levels of media coverage are more likely to engage in CSR report impression management, and this effect is especially significant in firms with a higher proportion of institutional investor shareholding and more analysts tracking. Further cross-sectional group studies show that market pressure is only present in firms whose CSR reports are subject to mandatory disclosure without third-party assurance or policy-oriented media attention.Research limitations/implicationsThis paper does not consider the attention of other forms of media. The findings of this paper has policy implications for a better understanding of the motivation underlying impression management in CSR reports, encouraging voluntary disclosure and assurance to relieve the market pressure from media coverage.Practical implicationsFrom the perspective impression management of social responsibility report, further understanding the governance role of media coverage. A large number of previous literatures have shown that media coverage has a good supervisory role, but these studies mainly focus on the financial level of enterprises. Media coverage seems to be a “double-edged sword”. While it plays a supervisory role and inhibits earnings management or irregularities at the financial level, it also brings enormous market pressure to the enterprises, which is reflected in the increase of impression management behavior of social responsibility reports at the non-financial level, and this pressure is probably caused by the financial level.Social implicationsVoluntary disclosure and verification of social responsibility reports, as an important mechanism to improve the quality of social responsibility reports, supports the correctness, scientificity and rationality of the current policies of the SFC and the exchange on encouraging voluntary disclosure and verification. In the future, changing regulatory thinking, encouraging voluntary disclosure of social responsibility reports and introducing more independent and authoritative certification agencies should be the direction and focus of policy-making, so that social responsibility reports can play a better role in helping investors make decisions.Originality/valueFrom the perspective of impression management of CSR reports, this paper provides evidence regarding the effect of media coverage and its transmission mechanisms. This paper uses China's unique institutional environments to study the impact of different types of media coverage on impression management in CSR reports in emerging market economy. Different from the institutional environment of developed countries such as the USA, mandatory disclosure and voluntary disclosure coexist in CSR reporting in China. The authors provide critical evidence to show that third-party assurance and voluntary disclosure improves the quality of CSR reports.

Value Relevance of Corporate Social Responsibility Disclosure on Public Companies in ASEAN Countries

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Does Capital Market Distrust CSR Reporting?: Economic Benefits in Presence of Complementary Monitoring Mechanism

From a theoretical point of view, corporate social responsibility (CSR) disclosure actions have associated a large list of benefits as result of the lower information asymmetry problems that provoke firms enjoy better financial conditions and higher market value. However, empirically there is no unanimity in the academy about these positive impacts. In this paper, we consider that the possible discretionary decision that managers could have in the elaboration of CSR report implies distrust about the credibility and utility of sustainability information. In this regard, the presence of independent in boards, directors that ensure better control of management decision, could moderate the relationship between the quality of CSR reports and its benefits. Independent directors, in their decision making process, associate their personal image, reputation and career with the CSR disclosures. For an international sample of analysis, our empirical evidence supports the premise that the market only positively assesses the utility and comparability of corporate social responsibility information, giving firms a superior value when there is a complementary mechanism that guarantee information credibility.

CSR Reporting Practices in Visegrad Group Countries and the Quality of Disclosure

Companies around the world more often issue publicly available reports to disclose how responsibly they conduct their business. The practices of corporate social responsibility (CSR) reporting are more popular in western part of Europe then in Central and Eastern European (CEE) countries and empirical studies related to these practices in the region are sporadic and fragmented. The Visegrad Group countries have undergone tremendous changes in political, environmental and social area during the last twenty years. The CSR concept in these countries is relatively new but is rapidly spreading, in particular as part of their integration with the European Union, as well as under the influence of transnational corporations (TNCs) and foreign investors. Therefore, acquisition of knowledge, which presents the functioning of CSR reporting practices in the region seems to be of interest to both the scientific community and enterprises themselves. An important part of the analysis conducted in the study was the assessment of quality of CSR reports issued in this region. The quality indicator of the studied reports was based on seventeen criteria related to relevance and credibility of disclosed information. The findings indicate that CSR reporting practices are not widespread among V4 countries and suggest some area of improvements. Furthermore, the achieved results confirm the existence of a relationship between two factors (external verification of a report and usage of the GRI guidelines when developing a report) and the level of quality of the CSR report.

Does CSR Reporting Really Impact FERCs?

ABSTRACT As part of a study on the value of corporate social responsibility (CSR) reporting for market participants, Dhaliwal, Radhakrishnan, Tsang, and Yang (2012) document a positive future earnings response coefficient (FERC) related to CSR report issuance. They argue the reports allow investors to better identify companies' social and environmental performance and thus better predict their future earnings. Our concern is that they fail to consider that CSR reports are likely issued for reasons other than informing investors, and we further argue that the low average quality of CSR reports makes it unlikely that companies use them for informing investors of actual social and environmental performance. Focusing on only first-time issuances of CSR reports by U.S. firms, we find, in contrast to Dhaliwal et al. (2012), no significant impacts on FERCs. Our results are robust to consideration of report quality and potentially differing impacts for firms operating in industries facing higher levels of social or environmental exposure. The findings thus suggest the claims made by Dhaliwal et al. (2012) regarding CSR reporting are questionable.

The credibility of CSR (corporate social responsibility) reports in Europe. Evidence from a quantitative content analysis in 11 countries

When it comes to corporate social responsibility (CSR) reports, skepticism and mistrust toward companies often prevail among both stakeholders and scholars. However, the overall content quality of CSR reports has only sparsely evoked researchers' attention. Therefore, this paper focuses on the credibility of CSR reports, based on both human and software-enhanced quantitative content analysis of 237 CSR reports from 11 European countries. Credibility is conceptualized as a multilayered construct along CSR and communication theories, filling the theory void in the field. The influence of contextual (e.g., industry), format, and firm-level (e.g., size) factors on reporting credibility is also investigated. The results show that European CSR reports do not score high on credibility, leaving much room for improvement. The study finds that it is standardization and content that matter most for reporting credibility; external influences are secondary, at best. To be considered credible, CSR reports must first be understandable to their readers; in addition, credibility involves truth, sincerity, and stakeholder specificity. Voluntary standardization affects CSR reporting credibility positively, whereas regulation does not yet have the same positive effect. Based on the empirical results of the content analysis, we present a new two-phase-model of reporting credibility. For practice, we suggest that companies focus on the contents of their reports to render them more credible. To raise credibility levels consistently, policy makers can create a level playing field in CSR reporting regulation, as already initiated by several countries.

An Evaluation of the Quality of Corporate Social Responsibility Reports by Some of the World’s Largest Financial Institutions

This study investigates the variations in the quality and comprehensiveness of 104 corporate social responsibility (CSR) reports published by the world’s largest financial institutions in 2012. Using a novel measure of CSR report quality, we examine the impact of certain national, legal, and firm-level factors that might explain differences in the overall quality and extent of coverage of various issues in these reports. Our findings show that legal factors and CSR environment in a firm’s country of headquarters play an important role in firms’ CSR reporting quality. Common law countries exhibit systematically higher overall CSR reporting quality than code law countries. Countries with higher CSR standards, policies, and regulations in place also produce significantly higher quality CSR reports. Firm size, on the other hand, has no major impact on the overall quality of CSR reports. In further analysis of the individual aspects of CSR disclosures, namely environment, philanthropy, bribery and corruption, and integrity assurance, we document that larger firms report at a higher quality on philanthropy and bribery and corruption. Bribery and corruption is reported at a higher quality in countries with common law tradition, high-quality legal regimes, and high CSR standards and regulations in place. We also observe higher quality integrity assurance in common law countries. CSR-minded countries and countries with low-quality legal environment also report on philanthropy at a higher quality. Finally, we offer guidelines for companies toward improving the quality of their reports, and suggestions for scholars and researchers for further avenues of research.

Assessing the quality of corporate social responsibility reports: the case of reporting practices in selected European Union member states.

The organization may communicate its engagement in sustainability and may presents results achieved in this field by creating and publishing corporate social responsibility (CSR) reports. Today, we can observe a growing number of companies issuing such reports as a part of their annual reports or as stand-alone CSR reports. Despite the increase in the number of such reports their quality is different. CSR reports do not always provide complete data that readers desire, which in turn intensifies the problem with the evaluation and comparison of the organization’s results achieved in this scope. Differences also occur between reporting models used in different EU countries caused by, inter alia, differently applied EU legislation on the disclosure of non-financial information in different Member States. This paper is one of the first attempts to perform a quantitative and qualitative analysis of corporate sustainability reporting practices in several European Union countries. The purpose of this article is to present the current state of CSR reporting practices in selected EU Member States and identify the differences in the quality and level of this kind of practices, taking into account the mandatory and voluntary model of disclosure. The study included separate CSR reports as well as annual reports with CSR sections and integrated reports published in 2012 in six selected EU Member States. The authors have used a specific evaluation tool in the examination of the individual reports. The assessment questionnaire consists of seventeen criteria grouped into two categories (relevance and credibility of information). In order to assess the quality of examined reports, the authors aggregated the indicators related with the reporting practices. The findings show that the quality level of the studied reports is generally low. Referring to its components, the relevance of the information provided in the assessed reports is at the higher level than its credibility. The study also indicates that the legal obligation of CSR data disclosure has a positive effect on the quality of CSR reports.

Regulatory pressure, blockholders and corporate social responsibility (CSR) disclosures in China

Purpose– This paper aims to investigate the relationship between external regulation pressure and corporate social responsibility (CSR) reporting decision and comprehensiveness and the relationship between block ownership and CSR in China.Design/methodology/approach– This paper provides descriptive statistics of the current state of CSR reporting in China. In addition, regression models are utilized to analyze the behavior of CSR reporting of a sample of 5,334 listed firms in China.Findings– Our paper records a significant increase of CSR reporting in the period of 2008-2010. Using a sample of 5,334 listed firms in China, we find a positive yet weak association between centrally controlled state-owned enterprises (SOEs) and CSR reports. Moreover, we find that firms with more concentrated block ownership are less likely to issue CSR reports.Research limitations/implications– Taken as a whole, our analyses suggest that the entrenchment effect from blockholders seems to dominate the incentive effect and this depresses the quality of CSR reports.Practical implications– Despite the well-known effect of economic factors on CSR decision, corporate governance such as ownership structure could complicate the final results. Furthermore, the institutional background of the country and its implications for corporate governance should be considered jointly and concurrently.Social implications– The positive effect from regulatory pressure on centrally owned SOEs suggests that regulation remains an effective tool to encourage CSR reporting in emerging markets.Originality/value– First, our study confirms prior research that CSR disclosure decision is primarily driven by economic and strategic considerations. Moreover, our results suggest that a country’s institutional background, in addition to economic and strategic considerations, influences the decision and quality of CSR disclosures. Second, we extend the literature on ownership structure, particularly with respect to blockholders. Third, our research design addresses a weakness in earlier studies which are biased exclusively on state ownership to the exclusion of all other blockholders.