Article

Motivations for issuing standalone CSR reports: A survey of Canadian firms

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Abstract

Purpose – The purpose of this paper is to provide insight into the companies’ motivations to issue or not issue voluntary standalone corporate social responsibility (CSR) reports in the Canadian context. Design/methodology/approach – The authors realized a questionnaire survey that asked Canadian companies why they do or do not issue standalone CSR reports, what their motivations and costs are, and the extent to which they comply with GRI guidelines. Findings – The results show that larger firms issue standalone CSR reports. As larger firms have more political visibility and are subject to greater external scrutiny than smaller firms (Watts and Zimmerman, 1986), the findings indicate that firms primarily issue standalone CSR reports in response to external scrutiny by stakeholders, which is consistent with a stakeholder perspective. The survey also identifies that ancillary motivations for Canadian firms for issuing standalone CSR reports are consistent with legitimacy and signalling perspectives. Research limitations/implications – The authors acknowledge that the generalizability of the findings is limited due to the sample being situated within a single national context. The inferences drawn from such a sample in Canada may not be applicable to other countries with different national institutional contexts. In addition, the small size of the sample may limit the generalizability of the findings. The authors also did not specifically consider the quality of the CSR reports in the study. Finally, the work may be affected by the inherent weaknesses associated with survey research, including the inherent bias of the individuals responding to the survey. Originality/value – The research adds to the growing body of research on voluntary CSR disclosures, with particular reference to the Canadian context.

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... Firms' corporate social responsibility (CSR) reporting has steadily gained scholarly attention over the last decades (Thorne et al., 2014). CSR is generally defined as actions that appear to further a social good beyond the interests of the firm and that is required by law (cf. ...
... McWilliams and Siegel, 2001: 117). Thus, firms reporting on CSR to their stakeholders aim to simplify access to their activities on environmental and social issues (Thorne et al., 2014). Numerous recent inquiries into this area are framed largely by attempts to reveal instrumental motivations behind firms' CSR disclosure and communication. ...
... Another important line of inquiry relates to the benefits that accrue from disclosure to the general public, framed primarily by resource-based traditions (Raithel and Schwaiger, 2015;Rindova et al., 2010). The stakeholder perspective extends this view by suggesting that a firm discloses information to meet the demands and expectations of a broad range of stakeholders (Thorne et al., 2014). In general, the focus on stakeholders' awareness of the appropriateness of a firm's behavior and respective effects on shareholder value appears to dominate these research domains (Beiting et al., 2014;Bennis et al., 2008;Rindova et al., 2010). ...
Article
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Large firms operating in underdeveloped institutional environments of transition economies tend to invest in seemingly unrewarded corporate social responsibility (CSR) initiatives. To explain this phenomenon, we extend the literature on the motives behind CSR disclosure in agribusiness from the institutional perspective on organizational legitimacy. The thesis is that self-interest rationales for CSR disclosure, as advocated by the strategic-legitimacy perspective, fall short of explaining the full scope of instrumental motivations for the proactive and excessive transparency initiatives of agribusiness companies. Using the example of internationally listed Ukrainian agroholdings, we show that firms faced with institutions that do not appropriately support access to market transactions not only adapt to fluctuations in the business environment but also proactively address key institutional bottlenecks by engaging in higher transparency and nonmarket initiatives. The case study analysis of the voluntary CSR disclosure of four agroholdings is conducted based on in-depth interviews with corporate managers and complemented with information from corporate reports and websites. This analysis offers insights into the development of corporate farming and its economic and social repercussions in Ukraine and, more generally, expanding the concept of CSR itself.
... Based on the work of Thorne, Mahoney, and Manetti (2014) on Canadian firms, companies in the energy, materials, financial, and the consumer discretionary sectors seem to have an active approach to CSR issues. The authors note that several sectors, although active in CSR, do not make their CSR reports public. ...
... They point out the exception of the manufacturing and energy sectors which voluntarily publish their CSR report because these sectors are more exposed to environmental and social issues. Furthermore, Thorne et al. (2014) suggest that there is no significant difference in financial performance and the level of social and environmental practices between companies that publish and those which do not publish CSR reports. ...
... However, a high proportion of female directors on boards leads to a superior ESG performance. Furthermore, consistent with the findings of Thorne et al. (2014), Shahbaz et al. (2020) also note that a high ESG performance does not necessarily lead to a higher financial performance. However, information disclosure on the sustainability of oil companies can serve as a competitive and institutional advantage (O'Connor and Gronewold, 2013). ...
Conference Paper
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This paper aims to investigate the linkage between ESG performance and the impact of the Covid-19 pandemic on the stock performance of listed firms in Europe. We base on the Eurostoxx 600 index to select firms with available MSCI ESG Rating data and Sustainalytics ESG Ranking data, collected from the Bloomberg terminal. The final sample of 344 firms is then divided into two sub-samples with high and low ESG performance. We then conduct two analyses which are stock performance comparison and panel data regressions to analyze the impact of various factors in 2019 and 2020. Empirical results show that firms with high ESG performance have a lower volatility than those with low ESG performance in both periods. However, there is no evidence that the stock performance is higher for firms with high ESG performance. On the other hand, the different results obtained with panel data regressions when using the MSCI ESG Rating and Sustainalytics ESG Risk Rating implies that it is important to carefully investigate the methodology defined by each ESG rating agency. Furthermore, we find a signicant impact of Covid-19 factors on stock performance such as the number of cases, deaths, lockdown, and quantitative easing announcements. The sector and country effects are significant during the Covid-19 pandemic. JEL classification: G3
... À partir d'un échantillon pairé d'entreprises américaines ayant publié et n'ayant pas publié de rapports de responsabilité sociétale distincts, les résultats de Mahoney et al. (2013) appuient l'hypothèse du signal. Ces résultats ne sont cependant pas supportés par une enquête menée par Thorne et al. (2014) auprès de 57 entreprises canadiennes, dont 32 ont déclaré publier un rapport de responsabilité sociétale distinct et 25 ont déclaré ne pas publier un tel rapport. Leurs résultats ne démontrent pas de différence significative entre les deux groupes en ce qui concerne le rendement des actifs, le rendement du capital investi et les seuils de performance de responsabilité sociétale établis à partir de l'indice CSID développé par Michael Jantzi Research Associates Inc. Toutefois, la taille semble être une variable importante. ...
... Ce résultat supporte l'hypothèse de l'écoblanchiment. Comme le relèvent Thorne et al. (2014), les grandes entreprises ont davantage de ressources à consacrer à la publication de ces rapports. Basés sur une revue systématique, Dienes et al. (2016) concluent que les variables ayant une incidence importante sur la publication volontaire de rapports ou d'éléments d'information portant sur la responsabilité sociétale des organizations sont la taille, la visibilité médiatique et la structure d'actionnariat. ...
... L'engagement de ces organisations dans l'étendue et la qualité des éléments d'information divulgués résulte vraisemblablement d'un engagement plus important dans des pratiques sociétalement responsables. À l'opposé, la faible étendue du nombre d'indicateurs divulgués ainsi que la faible qualité des éléments d'information divulgués par les organisations du second groupe semblent plutôt supporter une stratégie d'écoblanchiment (Thorne et al., 2014). En outre, le très grand nombre de références à d'autres sources d'information plutôt que de simplement communiquer directement l'élément d'information corrobore les stratégies d'obfuscation de certaines entreprises relevées dans les travaux antérieurs (Diouf & Boiral, 2017). ...
Article
en The aim of this study is to identify the performance indicators that Canadian corporations voluntarily disclose based on the Global Reporting Initiative (GRI) and to examine their comparability. The results tend to show that all the companies studied disclose few indicators and that the format of these indicators makes comparisons impossible. Additional analyses revealed that while a minority of companies publish some indicators, the vast majority (91%) disclose poor quality information. Accordingly, the companies' strategy appears to be to muddy the waters than actually account for their performance. Résumé fr Cette étude a pour objectif d'identifier les indicateurs de performance publiés volontairement par les sociétés canadiennes utilisant les lignes directrices de la Global Reporting Initiative (GRI) et d'examiner leur comparabilité. Les résultats démontrent que sur l'ensemble des entreprises étudiées, un nombre restreint d'indicateurs sont divulgués dans un format rendant leurs comparaisons impossibles. Des analyses supplémentaires ont permis d'observer qu'une minorité d'entreprises publient un nombre raisonnable d'indicateurs, alors que la vaste majorité (91%) divulgue des éléments d'information de piètre qualité. En conséquence, la stratégie déployée consiste à « noyer le poisson » plutôt qu’à rendre compte de leur performance.
... Based on the work of Thorne, Mahoney, and Manetti (2014) on Canadian firms, companies in the energy, materials, financial, and the consumer discretionary sectors seem to have an active approach to CSR issues. The authors note that several sectors, although active in CSR, do not make their CSR reports public. ...
... They point out the exception of the manufacturing and energy sectors which voluntarily publish their CSR report because these sectors are more exposed to environmental and social issues. Furthermore, Thorne et al. (2014) suggest that there is no significant difference in financial performance and the level of social and environmental practices between companies that publish and those which do not publish CSR reports. ...
... However, a high proportion of female directors on boards leads to a superior ESG performance. Furthermore, consistent with the findings of Thorne et al. (2014), Shahbaz et al. (2020) also note that a high ESG performance does not necessarily lead to a higher financial performance. However, information disclosure on the sustainability of oil companies can serve as a competitive and institutional advantage (O'Connor and Gronewold, 2013). ...
... In this regard, they state that both negative or positive information about CSR may still explain the corporate's compliance, therefore reputation and performance can be influenced. Over the time, the tendency of the impact of this reciprocal relationship will drive improvement in the quality of the CSRD (Thorne, Mahoney, & Manetti, 2014). ...
... & Narsa (2017); and Lee & Jung (2016). Since the company reputation has also influence on stock prices, although this influence can still be positive or negative, it is evident that before the investors make any decisions to invest, the corporate reputation is strongly considered as a value of trust (Vlastelica et al., 2018); Thorne et al., 2014). To examine the relationship of these three variables, in this study apply reputation as an intervening variable which may mediate the relationship between CSRD and the share price. ...
Article
p>This study aims to seek theㅤinfluenceㅤof corporateㅤsocialㅤresponsibilityㅤdisclosures (CSRD) on share prices with the company's reputation as intervening variable. The samples are derived from all of the consumer goods industries, which areㅤlistedㅤonㅤIndonesiaㅤStockㅤExchange during 2014-2018. Content analysis method is used to measure the company’s corporate social responsibility disclosures based on company’s annual reports and/or sustainability reports. Unlike previous studies, this research applies the Sustainability Accounting Standard Board (SASB) as the disclosures list to award the scores. Panel regression method and Eviews 9 were applied as analytical tools. Findings shows that CSRD does not influence the corporate reputation, but in contrast, CSRD influence significantly and positively to the share prices, and so does the corporate reputation. However, CSRD does not influence the share prices when it is mediated by the corporate reputation as intervening variable. When CSRD and Reputation were examined together, controlled by ROA, these variables positive significantly influence the corporate share price. </p
... All variables are fully defined in Table 3 assurance) exhibit greater semi-hard and hard ETs to address environmental risks and engage with stakeholders (Mahoney et al., 2013;Peters & Romi, 2014, 2015. These results are consistent with previous studies (Comyns, 2016;Helfaya & Moussa, 2017;Jaggi et al., 2017;Moussa et al., 2020;O'Dwyer et al., 2011;Peters & Romi, 2014;Thorne et al., 2014) that found positive influences of sustainability committees, GRI guidelines, and sustainability assurances on corporate environmental strategies, disclosures, and performances. This is largely in line with the stakeholder and legitimacy arguments that firms adopt environmental governance mechanisms as public relations tools to respond to stakeholder information needs and maintain corporate legitimacy, license, and reputation (Helfaya & Moussa, 2017;Mahoney et al., 2013;Michelon et al., 2015;Thorne et al., 2014). ...
... These results are consistent with previous studies (Comyns, 2016;Helfaya & Moussa, 2017;Jaggi et al., 2017;Moussa et al., 2020;O'Dwyer et al., 2011;Peters & Romi, 2014;Thorne et al., 2014) that found positive influences of sustainability committees, GRI guidelines, and sustainability assurances on corporate environmental strategies, disclosures, and performances. This is largely in line with the stakeholder and legitimacy arguments that firms adopt environmental governance mechanisms as public relations tools to respond to stakeholder information needs and maintain corporate legitimacy, license, and reputation (Helfaya & Moussa, 2017;Mahoney et al., 2013;Michelon et al., 2015;Thorne et al., 2014). Overall, these results imply that sustainability committees, GRI frameworks, and sustainability assurances promote corporate ETDs, mainly semi-hard and hard ETDs, to address stakeholders concerns and defend corporate social legitimacy but do not necessarily lead to an improvement in environmental performance (Comyns, 2016;Jaggi et al., 2017;Mahoney et al., 2013). ...
Article
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Although an increasing number of companies have publicly declared environmental targets (ETs), scant research has been conducted in this area. This study, therefore, investigates the extent of corporate environmental targets disclosure (ETD) and empirically examines whether environmental governance and performance influence the ETD of companies in the U.K. during the 2005–2013 period. We find that firms show a large degree of variability and inconsistency in their reporting of ETs. The results indicate that U.K. firms, particularly those with high environmental sensitivity, tend to disclose symbolic soft or semi-hard ETs to manage stakeholder perceptions and legitimize their existence. Moreover, Global Reporting Initiative (GRI) guidelines, sustainability committees, and sustainability assurance show positive relationships with ETD. We also find that U.K. firms that perform well environmentally are likely to set and disclose hard ETs. These results support stakeholder, legitimacy, and impression management theories. We suggest that there is a need for regulations that will not only enhance the usefulness of ETD but also encourage companies to take serious proactive action to reduce negative environmental impacts, possibly creating ‘win-win’ solutions. Our findings have important implications for policy-makers and various stakeholder groups.
... Disclosure of CSR reports, whether integrated with financial reports or not, may be viewed as a vital tool for informing stakeholders, as a legitimizing effort and providing information to investors, as well as mitigating the information asymmetry between managers and various stakeholders (Bondy, Moon, and Matten 2012;Hahn and Kühnen 2013;Thorne, Mahoney, and Manetti 2014). Since CSR reports are voluntary, unless otherwise mandated, they are also subject to firm flexibility and latitude in reporting content. ...
... Furthermore, firms in the financial sector may have to yield from pressure to address labor practices and employee health and safety (Sweeney and Coughlan 2008), even though these matters are not materially significant in this sector. Firms' business environment (Powell and DiMaggio 2012;Oliver 1991), environmental impact (Russo-Spena, Tregua, andDe Chiara 2018;Dobbs and Van Staden 2016;Gill, Dickinson, and Scharl 2008;Lattemann et al. 2009), size (Lattemann et al. 2009;Cho et al. 2015;Thorne, Mahoney, and Manetti 2014;Andrikopoulos and Kriklani 2013;Duff 2016;Li et al. 2010), and stakeholder influence (Thijssens, Bollen, and Hassink 2015;Vitolla et al. 2019) have all been shown to influence disclosure behavior. The two types of perspectives are therefore likely to have competing interests, and it is therefore not clear who the intended users of the reports are. ...
Thesis
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Online information sharing by firms has created an unprecedented amount of data to analyze by researchers. While conclusions from research should be drawn with basis in sound theory, there has also emerged a need to supplement these theoretical considerations with advanced data collection, storage and analysis as well as reporting to decisionmakers. As such, the emergence of the research field of microdata analysis has given aid in the process of gathering large quantities of data and managing databases, analyzing said data with knowledge in advanced areas, e.g., statistical inference, machine learning, artificial intelligence and the like, and presenting the results for decisionmakers and stakeholders in a clear, coherent way while also stating economic consequences to enable decision-making. This dissertation consists of five individual papers contributing to this field of research, and in the process answering a set of questions related to voluntary information sharing, retail pricing, and firm performance. In the first paper, a large-scale data collection of corporate social responsibility reports was coupled with state-of-the-art topic modelling analysis to answer the question who the intended users of these reports are, and the results show that the shareholder perspective is more prominent rather than the stakeholder perspective. The second paper empirically shows the value of having lowest price or highest ratings on a price comparison website, with the former being found to have a profound impact on demand, while the effect of the latter is more unclear. The third paper relies on time series clustering analysis to test if intertemporal price discrimination is the cause of remaining price dispersion in low search cost markets. The empirical evidence rejects an established theory of explaining price dispersion in a wide range of markets characterized by low search costs. The fourth paper provides an investigation into how the increased use of a price comparison website affect pricing. It is found that an increased use of the platform and number of retailers entering lead to a reduction in average prices with substantial consumer savings as the general outcome. Following the results of the third paper, a more likely model to explain the persistent price dispersion in low search cost markets is also presented. The fifth and final paper combines two datasets with rigorous statistical analysis to answer why firms compete on price comparison websites, despite the threat of increased competition and reductions in prices. The results show that retailers competing on price comparison websites increase their productivity which creates increased profits that are shared between shareholders and employees. The different types of information sharing studied in this thesis is thus found to have profound impact on consumers, firms and society at large.
... To signal that their corporate sustainability activities are effective and not a greenwashing attempt (Cohen and Simnett, 2015), companies tend to release high-quality SRs and assure them (Clarkson et al., 2011). Prior research applying signalling theory (Clarkson et al., 2011;Maroun, 2019;Thorne et al., 2014) points out that companies adopt SRA practices, which are extremely expensive, to enhance the credibility of their SRs (Maroun, 2020). ...
Article
Purpose This paper aims to investigate whether religiosity and religious diversity affect the adoption of sustainability reporting assurance (SRA) by companies based in predominantly Roman Catholic and Protestant countries. To this aim, a theoretical framework is developed using the social norm, signalling and agency theories. Design/methodology/approach A pooled logit regression model is applied on a sample of 2,541 firm-year observations collected from the most sustainable companies in Europe in the period between 2004 and 2015 to test the effect of religiosity on SRA adoption. Different analyses are used to check for the robustness of the findings and a generalized method of moments (GMM) is used to address potential endogeneity issues. Findings The results of this study show that companies based in highly religious countries are more likely to adopt SRA practices to show compliance with the religious social norms of their stakeholders. The results also show that companies based in predominantly Roman Catholic countries are more likely to adopt SRA practices than those operating in Protestant countries. This may be due to the fact that the structural organization of Catholicism is based on a vertical, top-down control system, which does not foster trust and requires constant assurance. This explains the emphasis placed on SRA by stakeholders adhering to Catholicism. Stakeholders from Protestant countries, on the other hand, tend to rely more on the principles of social ethics and social mutual control that characterize their doctrine and, therefore, do not need any additional, external assurance of corporate commitment to sustainability. Originality/value This paper provides new insights into the influence that religiosity and religious diversity have on SRA. This study also provides evidence on the usefulness of social norm theory for conducting empirical research into corporate practices and could set an example for future studies in this field.
... The tension between sustainability discourse and practice has generated extensive and in-depth studies on corporate voluntary sustainability reporting, often resulting in contradictory conclusions (Milne and Gray, 2013;Unerman and Chapman, 2014). While some authors support the potential of SES reporting to make corporations more accountable and transparent about their social and environmental impacts (Bebbington et al., 2014;Rodr ıguez and LeMaster, 2007), part of the literature calls into question the validity of this accounting practice because it tends to be limited in scope (O'Dwyer et al., 2005), disingenuous (Aras and Crowther, 2009) and utilized as a legitimacy tool (Cho et al., 2012;Magness, 2006;Milne and Gray, 2007) or for responding to institutional pressures (Thorne et al., 2014). Supporters of legitimacy theory maintain that companies engage in SES reporting mainly to secure their own interests (Milne and Gray, 2013) with the explicit aim of deflecting, obfuscating or rationalizing their relatively poor social and environmental performance under reputational threats (Cho et al., 2010(Cho et al., , 2015, rather than indicating rational plans and actions for facing real sustainability problems (Boiral, 2013;Cho et al., 2010;Patten, 2012). ...
Article
Full-text available
Purpose This study contributes to the literature on hypocrisy in corporate social responsibility by investigating how organizations adapt their nonfinancial disclosure after a social, environmental or governance scandal. Design/methodology/approach The present research employs content analysis of nonfinancial disclosures by 11 organizations during a 3-year timespan to investigate how they responded to major scandals in terms of social, environmental and sustainability reporting and a content analysis of independent counter accounts to detect the presence of views that contrast with the corporate disclosure and suggest hypocritical behaviors. Findings Four patterns in the adaptation of reporting – genuine, allusive, evasive, indifferent – emerge from information collected on scandals and socially responsible actions. The type of scandal and cultural factors can influence the response to a scandal, as environmental and social scandal can attract more scrutiny than financial scandals. Companies exposed to environmental and social scandals are more likely to disclose information about the scandal and receive more coverage by external parties in the form of counter accounts. Originality/value Using a theoretical framework based on legitimacy theory and organizational hypocrisy, the present research contributes to the investigation of the adaptation of reporting when a scandal occurs and during its aftermath.
... Information asymmetry describes a situation where one party has more information ( If the transparency level is insufficient, those who believe they have inadequate information such as investors will protect themselves by offering lower prices than the actual price or refusing to make transactions that eventually lead to higher bid-ask spreads. (Dhaliwal et al. 2011; Thorne et al. 2014).This is in line with what Akerlof (1970) suggested that due to the widening gap with the real information, the information asymmetry effect causes a good car to be priced as much as a lemon car. ...
Article
Full-text available
This study aims to examine the effect of corporate sustainability success on the basis of knowledge inc onsistency: an applied analysis on the Egyptian stock exchange-tracking the flourishing interests of international organizations and programs in the Social Responsibility Repo rt, where GRI 4 was published in 2013 by the Global Reporting Initiative, in addition to the 2010 Egyptian Corporate Responsibility Index (Represented by the Ministry of Investment) rel eased by the Egyptian Government (Represented by the Ministry of Investment), researchers conveyed the infor mation content of the Social Responsibility Report in 41 items categorized into types of information. According to the Egyptian Corporate Responsibility Index, the Community dimension information and customer / product dimension information have a significant negative impact on information asymmetry from corporate sustainability results. In general, there is a greater demand for company-specific information by leveraging interpersonal gaps between firms. Nonetheless, disclosure requirements only partly serve this need as they focus on corporate sustainability's corporate governance aspect. In particular, knowledge on the social pillar complements investors and drives the overall effect. Our research adds to the literature on corporate sustainability performance's positive capital market impact by demonstrating its strength in the proposed effect on Egyptian stock markets and institutional determinants.
... Debido al propósito de la encuesta y al enfoque cualitativo del estudio, la muestra de participantes fue deliberada. Este tipo de muestreo es plenamente aceptado en las investigaciones de este campo de estudio específico y tiene como criterios de selección la comprensión y pertinencia de los actores y no su representatividad estadística (Thorne, Mahoney y Manetti, 2014;Vaz Ogando, Ruiz Blanco, y Fernandez-Feijoo Souto, 2018;Xiao y Shailer, 2021). El cuestionario para el sector público fue enviado a 31 personas que cumplían los perfiles del grupo de interés, mientras que el cuestionario para el sector privado fue enviado a 69 personas que cumplían con los perfiles de dicho grupo, para un total de 100 personas. ...
Article
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El aumento en la divulgación de información social y medioambiental (de sostenibilidad) genera preguntas sobre su utilidad y materialidad, lo que implica conocer las expectativas de los stakeholders. El stakeholder engagement permite señalar que la participación de los grupos de interés no solo debe centrarse en la producción de la información en las empresas, sino también en la definición de los marcos y estándares que estructuran estos reportes. Este trabajo busca caracterizar las expectativas y la percepción que tienen diversos stakeholders, sobre la utilidad de los informes de sostenibilidad emitidos por organizaciones públicas y privadas en Colombia. A partir de dos cuestionarios respondidos por 62 gestores, preparadores, auditores, reguladores, estudiantes y profesores, se identifican temas que los marcos más extendidos (GRI) no incluyen y que incrementarían la materialidad de esta información en Colombia: acciones para la paz, lucha contra la corrupción y la desigualdad, información para los ciudadanos, entre otros. Abstract: Increased disclosure of social and environmental (sustainability) information raises questions about its usefulness and materiality, which implies knowing the expectations of stakeholders. Stakeholder engagement allows to point out that stakeholder participation should not only focus on the production of information in companies, but also on the definition of the frameworks and standards that structure these reports. Based on two questionnaires answered by 62 managers, preparers, auditors, regulators, students and teachers, we identified topics that the most extended frameworks (GRI) do not include and that would increase the materiality of this information in Colombia: actions for peace, fight against corruption and inequality, information for citizens, among others.
... A literature review was conducted by Ali et al. (2017) to compare the determinants of CSR disclosure in developed and developing countries. The concern of specific stake-holders in developed countries, for example, regulators (Chih et al. 2010;Shi et al. 2012), shareholders (Thorne et al. 2014), creditors (Roberts 1992), and the media (Deegan et al. 2002) possess important factor influencing CSR disclosure. Meanwhile, in developing countries, CSR reporting is influenced by the external forces or powerful stakeholders, for example, international buyers (Belal and Owen 2007), foreign investors (Chiu and Wang 2014), international media concerns (Islam and Deegan 2008), and international regulatory bodies such as the World Bank (Rahaman et al. 2004). ...
Article
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This study was carried out to reveal the actual quality of sustainability disclosure, actuated by some recent studies that pointed out the lack of disclosure quality amid the growing trend of CSR and the tendency that CSR disclosure was dominantly constructed to manage the corporate image. This study also seeks to investigate the role of stakeholder groups (primary, secondary and regulatory stakeholders), by analyzing the sustainability disclosures of 224 primary sector companies among the five emerging markets in Southeast Asia: Indonesia, Malaysia, Singapore, Thailand, and Philippines in the year of 2016. The extensive disclosure index was also employed to assess each disclosure item under the GRI G4 Guidelines. The results revealed that the quality of sustainability disclosure is still low. In this regard, Thailand turns into the country with the highest score, followed by Malaysia and Indonesia. Labor practice aspect becomes the most expressed aspect by the companies, followed by environmental and social aspect. Based on results obtained, it is therefore argued that employees, auditors, mass media, and regulators have roles in encouraging companies to enhance the quality of sustainability disclosure. However, this study does not find a significant influence from the shareholders and international consumers. The contradictory result was found from creditors, conveying that they possess a negative influence on the quality of sustainability disclosure. Abstrak Penelitian ini ditujukan untuk menganalisis kualitas pengungkapan keberlanjutan, yang dimotivasi oleh sejumlah studi yang menunjukkan rendahnya kualitas pengungkapan di tengah maraknya tren CSR dan adanya kecenderungan bahwa pengungkapan tersebut lebih ditujukan untuk mengendalikan citra perusahaan. Penelitian ini juga ditujukan untuk menginvestigasi pengaruh kelompok stakeholder (primary, secondary, dan regulatory stakeholder) dengan menganalisis kualitas pengungkapan keberlanjutan pada 224 perusahaan sektor primer pada negara ASEAN-5, yaitu Indonesia, Malaysia, Singapura, Thailand dan Filipina, dengan tahun observasi 2016. Setiap pengungkapan keberlanjutan perusahaan dinilai melalui metode analisis konten yang mendalam dengan pedoman GRI G4. Hasil penelitian menunjukkan bahwa tingkat kualitas pengungkapan keberlanjutan masih rendah. Thailand menjadi negara dengan kualitas pengungkapan keberlanjutan tertinggi, disusul oleh Malaysia dan Indonesia. Aspek ketenagakerjaan menjadi aspek yang paling banyak diungkapkan oleh perusahaan, disusul dengan aspek lingkungan dan kemasyarakatan. Berdasarkan hasil pengujian, diketahui bahwa kelompok karyawan, media massa, auditor dan regulator memiliki peranan dalam mendorong perusahaan untuk melakukan pengungkapan keberlanjutan yang berkualitas. Namun, tidak ditemukan adanya pengaruh yang signifikan dari kelompok pemegang saham dan konsumen internasional terhadap kualitas pengungkapan keberlanjutan. Penelitian ini juga menemukan adanya pengaruh negatif dari kelompok kreditor. Kata kunci: pengungkapan, keberlanjutan, pemegang kepentingan, GRI G4, ASEAN
... Companies usually formalize their activities through incorporating specific documents [144] in which social sustainability takes a considerable part, such as "Sustainability Reports", "GRI Reports" (GRI-Global Reporting Initiative), "Citizenship Reports" or "CSR Reports." Regardless of what they are titled, these reports meet three key criteria: focus on social and environmental issues, distinction from the firm's annual report and content that is not prescribed by mandatory reporting criteria [145]. These documents can take the form of separate compilations of social information, but usually, they include environmental information, too. ...
Article
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Social sustainability is slowly becoming a more important aspect of a company’s management, particularly in the case of multinational companies with an international network of subsidiaries placed in diverse cultural and social environments. The concept of social sustainability is strongly connected with a considerable number of stakeholders, compared to the environmental and economic aspects of sustainability. The nature of activities under the social pillar of corporate responsibility connects social sustainability with family business, which aims at the principles of social solidarity, equality and ethics. This article uniquely analyzes selected aspects of social sustainability on a sample of 201 Slovak subsidiaries of foreign multinationals and finds differences between family and nonfamily ones. Surprisingly, the conducted research proved that the examined family businesses cannot be considered as bearers of social sustainability in Slovakia, since, in many aspects, the nonfamily businesses implemented the monitored aspects in larger measures, and there were only two factors that turned out to be significant, according to the type of business ownership. Equal opportunities in the workplace were the only variable, due to which significant differences were seen, according to the factor of a family business and the factor of employees’ gender simultaneously, which makes it a crucial variable. The conducted study fills the gap in explanation of interconnections between social sustainability, family business and equal gender opportunities, which makes it unique not just in Slovak conditions.
... One of the most common findings is a significantly positive association between firm size and the quantity or quality of CSR disclosures (e.g., Hahn and Kühnen 2013;Li et al. 2021). This positive relation could be explained by greater public scrutiny of large firms, which arguably incentivizes them to engage in CSR activities and reporting (e.g., Cormier and Magnan 2003;Thorne et al. 2014). Another explanation may be that CSR communication is relatively less costly for larger firms, while the actual implementation of CSR activities is not (Wickert et al. 2016). ...
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This study collates potential economic effects of mandated disclosure and reporting standards for corporate social responsibility (CSR) and sustainability topics. We first outline key features of CSR reporting. Next, we draw on relevant academic literatures in accounting, finance, economics, and management to discuss and evaluate the potential economic consequences of a requirement for CSR and sustainability reporting for U.S. firms, including effects in capital markets, on stakeholders other than investors, and on firm behavior. We also discuss issues related to the implementation and enforcement of CSR and sustainability reporting standards as well as two approaches to sustainability reporting that differ in their overarching goals and materiality standards. Our analysis yields a number of insights that are relevant for the current debate on mandatory CSR and sustainability reporting. It also points scholars to avenues for future research.
... While Baoviet and Vinamilk adopted external assurance from PricewaterhouseCoopers (PwC) Vietnam, PNJ cooperated with Deloitte Vietnam for assurance of its sustainability reports. This nding is in line with the statement that the Big Four auditing rms are proven to be dominant in the sustainability reporting assurance market (Thorne et al., 2014;Uyar, 2017;Miller et al., 2017). This can be explained by the sophisticated nature of sustainability report assurance that requires endorsement from reliable and established organizations. ...
Article
This study explores corporate sustainability reporting in Vietnam, whether it is evolutionary or revolutionary. The study centers on answering the questions of the patterns of sustainability reports (SRs) and the level of conformity in the SRs of these companies to the Global Reporting Initiative (GRI) framework. Five big publicly listed companies in Vietnam have been selected for the case study. The content analysis method was applied for the data analysis. The findings indicate that four aspects are contributing to the evolution in sustainability reporting practices in those five companies. These include the nascent application of the GRI framework, the use of external assurance, the reporting models, and the incorporation of the United Nations Sustainable Development Goals into the reporting process.
... While Baoviet and Vinamilk adopted external assurance from PricewaterhouseCoopers (PwC) Vietnam, PNJ cooperated with Deloitte Vietnam for assurance of its sustainability reports. This finding is in line with the statement that the Big Four auditing firms are proven to be dominant in the sustainability reporting assurance market (Thorne et al., 2014;Uyar, 2017;Miller et al., 2017). This can be explained by the sophisticated nature of sustainability report assurance that requires endorsement from reliable and established organizations. ...
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As a result of the increase in global climate change and the development of social networks, the study of ecotourism and the impact of social networks has been getting greater attention. Nonetheless,research examining the impact ofsocial networks on ecotourismhas been limited. This study investigates the relationship between ease of use, perceived usefulness, wordof-mouth (WOM), perceived trust, and tourist attitude towards ecotourism, and examines the moderating role of perceived risk on these relationships in the context of Vietnam. The regression analysis was conducted with data from answers of 231 respondents. The results show that perceived trust has the largest impact on tourist attitude towards ecotourism, which is followed by perceived usefulness. WOM communication has the least impact. The study also highlights the role of perceived risk in moderating the relationship between social networks and tourist attitudes.
... Para abordar el objetivo del estudio se elaboró un cuestionario ad hoc tipo encuesta, que se compuso de 5 secciones (ver Anexo): Aspectos generales, Estrategia y cultura (6 ítems); Prácticas de EC dividida en 4 áreas: Abastecimiento (5 ítems), Producción (7 ítems), comercialización y distribución (9 ítems) y destino final (5 ítems); Información circular (7 ítems). Las preguntas incluidas dentro de cada sección fueron desarrolladas en base a estudios anteriores relacionados con la implantación de la EC; con el sector agroalimentario y con información de sostenibilidad y circular (Bhimani et al., 2016;Ellen Macarthur Foundation, 2017;Laboratorio de Ecoinnovación, 2017;ONU FAO, 2020;PACE, 2021;Salimi, 2021;Stewart & Niero, 2018b;Thorne et al., 2014;Verbeek, 2016;Windolph et al., 2014;Zhu et al., 2010). En la mayoría de las preguntas se aplicó una escala de Likert de 4 puntos. ...
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El impacto ambiental del sector agroalimentario es crítico a nivel mundial dados los altos niveles de contaminación, pérdida de recursos y de energía que le son atribuidos. Así, el desarrollo de la economía circular en el sector aparece como una oportunidad y un desafío. Para esto, la generación de información útil para la toma de decisiones circulares es clave, siendo los reportes de sostenibilidad una importante vía para lograrlo. En este contexto, la presente investigación busca evaluar el grado de internalización de la economía circular en empresas agroalimentarias argentinas, incluyendo la información circular que se divulga y si existen factores que lo influencian, desde la teoría institucional. Se trata de un estudio descriptivo y exploratorio de corte mixto. Para llevarlo adelante se analizaron 210 respuestas recibidas a una encuesta diseñada ad hoc, mediante estadística descriptiva y test de diferencias de medias para contrastar las hipótesis. Los resultados generales muestran que los niveles de internalización son bajos tanto en la estrategia, prácticas como en la información circular que se divulga. Las empresas agroalimentarias argentinas se ven afectadas por factores institucionales para implementar la economía circular. Futuras investigaciones deben concentrarse en entender las motivaciones y barreras que deben superarse para lograr una verdadera adopción de la economía circular en el sector.
... They noted that internal CSR activities tend to be more apparent than external activities and may indicate an increased effort at marketing and signaling increases in CSR efforts to stakeholders. In addition, Thorne, Mahoney, and Manetti (2014) find that Canadian firms tend to engage in these CSR reporting activities as a result of pressure from stakeholder interests. In further research Thorne, Mahoney, Gregory, and Convery (2017) also find a correlation between standalone CSR reporting and CSR strategic alliances and that these strategic activities are done differently between the US and Canada. ...
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Corporate social responsibility (CSR) is a concept embraced in Canada in multiple sectors with each having a variety of stakeholder groups. This chapter describes the multiple viewpoints about CSR according to the perspectives of different industries and how those perspectives influence the use and approach to CSR by Canadian firms. Founded in 1867, Canada has a short history but from the perspective of the indigenous people of Canada, the land has been settled for thousands of years. The arrival of European settlers approximately 500 years ago, and the establishment of businesses that extracted, processed, and traded natural resources destabilized an organizational system established by First Nations people that considered social responsibility and balance in the context of social and environmental stakeholders. However, the current dissonance of a natural resource extraction sector working within a culture of sustainability driven by global climate and societal changes is unique in a country like Canada and creates challenges for local firms to implement CSR. From today’s perspective of achieving CSR through sustainable goals (for example the United Nations’ 17 Sustainable Development Goals), there are economic pressures on corporations to succeed using the available resources and contribute to a positive triple bottom line—creating economic, societal, and environmental value. At the rural level in Canada, firms are pushed towards sustainable farming methods with minimal environmental impact but high societal contributions. At the urban level in Canada, the influx of manufacturing and service corporations, increasing the pull of inhabitants to urban centres creates social, environmental and economic pressures that are difficult for municipalities to handle without the cooperation of corporations. This chapter focuses on the last ten to twenty years, where the paradox of living in a resource-rich country, is described from the perspective of what Canadian firms are doing at the corporate level and across industries to comply with institutional and societal pressures to improve their current CSR practices.
... La letteratura in tema di contabilità aziendale ha esaminato i fattori, le determinanti e le motivazioni alla base del processo di disclosure e rendicontazione di sostenibilità, soffermandosi dunque sul "perché" le aziende decidono di rendicontare e comunicare le informazioni di natura non-finanziaria (Adams, 2002;Cho et al., 2015;Farneti e Guthrie, 2009;ÒDwyer, 2002;Thorne et al., 2014). D'altro canto, studi che si focalizzano sul "come" le aziende rendicontano e divulgano questa tipologia di informazioni sono necessari (Adams and Larrinaga-González, 2007;. ...
Article
The purpose of this study is to investigate the role of management control systems. Particularly, this research aims at examining how management control systems support (1) the implementation of sustainability strategies within the organization and (2) the non-financial reporting process. This qualitative research focuses on the case study of Edison. Data include sustainability reports, sustainability plans, and non-financial reports that the organization published during the last three years. Moreover, the authors interview the or-ganization's sustainability managers, management accountants, and controllers to grasp certain peculiarities related to the use of management control systems, and to deepen this control systems' role in the sustainability disclosure process. Relying on Merchant and Riccaboni's (2001) theoretical framework, this study finds that management control systems play a key role, summarized as follows: support in the decision-making process, definition of objectives and related sustainability targets , monitoring activities, guidance in identifying corrective actions, and measures for an effective improvement of non-financial performance. From a practical perspective, the findings of this study provide interesting insights related to the definition and implementation of organizational solutions for economic and financial equilibrium; moreover, the findings of this study also provide interesting insights in terms of sustainability performance.
... Whilst, The Global Reporting Initiative (GRI) stated SR is "an organization's practice of reporting publicly on its economic, environmental, and/or social impacts, and hence its contributions -positive or negative -towards the goal of sustainable development" (GRI Standards, 2016). SR based on GRI Standards is one of the forms of standalone sustainability reporting that is usually, not always a voluntary disclosure (Lozano, et al., 2016, Thorne, et al., 2014. ...
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The purpose of this study is to assess the quality and maturity of sustainability reports of palm oil companies listed on the Indonesia Stock Exchange (IDX). The findings indicate that there are few differences in the maturity levels of palm oil companies in implementing sustainability reporting based on GRI standards and the maturity sustainability reporting at a moderate level of relevant information. The majority of disclosure of sustainability reports is general disclosures and less present in economic and environmental disclosures. Companies need to improve the quality of their sustainability reporting and strengthen the validity of the measurement. Sustainability reports have the potential to improve the sustainability agenda by allowing management and shareholders to make more informed decisions about sustainability initiatives.
... This way, organizations' decisions to engage in socially responsible activities hinge on their impression-management motivations related to situational stimuli and audience factors (Carter, 2006); high network centrality will increase this motivation. On the one hand, being visible in the network creates the pressure of reputation loss due to a higher degree of media scrutiny and public criticism (Lee, 2013), pushing the executives to exert extra efforts in impression management and firms to take a more proactive approach to reporting their CSR activities (Thorne, Mahoney, & Manetti, 2014). On the other hand, social networks strengthen norms of reciprocity that urge concern for others' welfare (Putnam, 2001). ...
Article
Extensive research has documented how corporate social responsibility (CSR) outcomes are determined by CEOs' intrinsic characteristics, while their social network status has been under-researched. Building on impression management theory and resource-based theory, the current study analyzes the association between CSR activities and top management's position in the social hierarchy, i.e., network centrality. The heterogeneous effects across different restaurant and CSR types are examined based on stakeholder theory. Using a panel dataset of publicly traded U.S. restaurant companies and a novel dataset of CEO network centrality, we find that firms with highly connected CEOs are involved in more socially responsible activities. In addition, the marginal effect of network centrality on CSR is stronger for fast-food than for full-service restaurants and more prominent for external than internal stakeholder subcategories. The results advance the determinant analysis of CSR and provide managerial implications for CEO selection and policy suggestions on CSR promotion.
... Regarding firm-specific factors, CSR reporting is positively associated with firm size, ownership structure, corporate governance, and management-specific characteristics. Indeed, larger companies are more scrutinized and, thus, tend to disclose CSR information in a higher quantity and of better quality (e.g., [37][38][39]). Furthermore, the greater the ownership dispersion, the higher the likelihood that the firm discloses information [40]. ...
Article
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The aim of this discussion paper is to address three major concerns in establishing sustainability in service organizations regarding the intersections among external reporting, internal governance, and business management and innovation. External reporting addresses issues related to sustainability information specificities and determinants, the pros and cons of mandating CSR disclosures, and the need for assurance. The internal management of sustainability refers to the opportunities and challenges for services to introduce sustainable business models and sustainability innovation. Finally, internal governance prioritizes the control process and systems employed by managers to make informed decisions and implement sustainability strategies. By means of an extensive and sophisticated literature review, the article contributes to untangling the opportunities and challenges that services face when adopting external and internal practices to commit to sustainability. Specifically, the paper addresses how company-level mechanisms of transparency, accountability, and innovation are linked to system-level mechanisms of implementation that lead to the adoption of sustainability in service organizations.
... Accordingly, as measured in previous studies, social responsibility accounting practice is quantified in this study by the employee dimension, environmental dimension, community dimension and quality of product dimension. The practice of social responsibility has been measured in different studies (e.g., (Al-Tamimi, 2014;Al Ramahi, Alaboud, Owais, AlRefae, & Shahwan, 2014;Kim & Choi, 2013;Leon & Araña, 2014;Martínez & Del Bosque, 2013;Minnee, Shanka, Taylor, & Handley, 2013;Razek, 2014;Thorne, Mahoney, & Manetti, 2014)). ...
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This study aims to present a true image of social responsibility accounting (SRA) in Jordanian companies listed on the Amman Stock Exchange (ASE). A survey questionnaire was employed to check the level of SRA practice, and a checklist was used to discover the level of SRA disclosure which was collected from the annual reports of the firms listed on the ASE. The questionnaires and annual reports were employed to collect information from 104 companies in the financial, services, and industrial sectors for this study. SPSS was used to for data analysis and the results showed that the level of SRA practice in listed companies on the ASE is good, while the level of SRA disclosure is very low. The latter could be related to many reasons, including lack of awareness of Jordanians companies' managers in the culture of SRA and related issues due to the novelty of SRA disclosure in Jordan and developing countries. In addition, companies mostly focus on product quality when they practice SRA.
... Research has extended to include using integrated reporting as a means to improve accountability to stakeholders. Although investigating CSR reporting rather than integrated reporting, Thorne et al. (2014) concluded in their investigation of firms based in Canada that it is stakeholder scrutiny and activism that triggers the production of standalone CSR reports. This conclusion is consistent with the tenets of accountability, legitimacy and signalling theories (Dumay et al., 2015). ...
Article
Purpose The International Integrated Reporting Council (IIRC) has promulgated the production of integrated reports to enhance transparency and encourage improved stakeholder relationships. The purpose of this study/paper is to explore how managers prioritize the needs of stakeholders and to what extent integrated reporting is associated with those stakeholder relationships. Design/methodology/approach The paper uses a case study/interpretative approach to compare the underlying motivation for the preparation of an integrated report across three case study sites from three different industry groups. Face-to-face and telephone semi-structured interviews, email correspondence and a review of the integrated reports form the basis for the data collection and analysis. Findings The case studies investigated for this project provide evidence that integrated reporting did motivate further stakeholder engagement to increase the organizations’ legitimacy and transparency. Overall, the authors found that the three case study organizations used the production of an integrated report to cement their place as a “leader” in their respective industry group. Moreover, managers regarded the current statutory accounts as inadequate in communicating and engaging with a broad range of stakeholders. There were elements of enhancing, defending and repairing legitimacy and managers tended to equate legitimacy with transparency. Research limitations/implications Three case study sites were selected on the basis of producing exemplary integrated reports, and senior executives provided their views on stakeholder engagement. For the scope of this study, the stakeholders themselves were not involved in this investigation which can be viewed as a limitation. Practical implications The international IIRC Framework is built upon the notion that stakeholders are integral to assisting the organization in creating value. The outcomes of this investigation suggest that for preparers, the incumbent organization is reliant on the leadership of senior managers (inclusive of the chief executive officer) and directors to actually instigate the process. In Australia and New Zealand, given that integrated reporting is not mandatory, regulators have no influence over the scope, content and veracity of integrated reports. It seems likely that further stakeholder engagement will become intrinsic to the business model of organizations as a means to quell any notion that it is engaging in greenwashing. Originality/value The value of this paper is to contrast how three quite distinct organizations are using their integrated reports to communicate their approach to stakeholder engagement. Stakeholder salience dimensions are used to explore the importance attributed by senior managers.
... Most of researches regarding voluntary sustainability report are based on this theory. Sustainability report is used to reduce skepticism of stakeholders , change public perception of sustainable performance (Clarkson et al. 2008), and fulfill demands of stakeholders (Sassen et al. 2018;Thorne et al. 2014;Dienes et al. 2016). This pressure gets worse due to the increase of mass media concern with the issue of sustainability (Reverte 2016) which makes a company that is more impressionable to the mass media more likely to make a sustainability report. ...
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The latest regulations in Indonesia (SEOJK No 16/SEOJK.04/2021) have required public companies to make a sustainability report every year in order to increase sustainable in­vestment. Prior to this regulation, several public companies had made sustainability reports and received benefits of sustainability report. This makes issuers ask whether after being obligated, public companies still get the benefits that have been obtained from voluntary sustainability reports and under what conditions the mandatory sustainability reports are beneficial for public companies. This study answers the public companies' doubts by con­ducting a systematic literature review on research on mandatory and voluntary sustainability reports in Q1 and Q2 journals from 2008-2018. Before answering the issuers' doubts, this study explains the reasons why issuers make voluntary sustainability reports and the benefits derived from voluntary sustainability reports. After that, based on previous research, this study explains whether the benefits obtained from voluntary sustainability reports can still be obtained in mandatory sustainability reports. This study found that sus­tainability reports were made because of the desire to benefit from these reports initiated by company leaders coupled with institutional pressure. The benefits of voluntary sustainability reports are the positive perception of shareholders and increased concern for the company's sustainability. Mandatory sustainability reports can still provide some (though not all) of the same benefits as voluntary sustainability reports. In addition, the sustainability report must be able to cover the weaknesses of the voluntary sustainability report with the condi­tion that there is strict legal coercion, strict supervision, and the addition of an obligation to audit sustainability information which is strengthened by market demands to make a sus­tainability report. Therefore, the Indonesian government must pay attention to these condi­tions for this regulation to be implemented properly.
... In this study, the identified sample consists of 61 German companies in the overall healthcare sector. Thorne et al. (2014) focussed on a single country to ensure that corporate governance structures, requirements on reporting, and the reporting culture and behaviour are comparable. 61 companies are HDAX companies of the sectors pharma, medical technology and conglomerates. ...
Article
This study assesses the status quo of sustainability reporting by German healthcare companies. First, content analysis was conducted based on eight sustainability reports. Second, we developed case studies for three of those firms by investigating the further reporting environment. The results indicate that the specific business sector of a company does not influence its sustainability reporting level. Moreover, the case studies show a differentiated picture in regards to the sustainability activities of those companies. Most companies recognise sustainability as a subordinate part of their company values and often integrate substantial sustainability schemes. Only one company emphasises that sustainability has always been at the core of the company’s philosophy. To ensure a more transparent and sustainable development, this outcome indicates that new laws should not only require the creation of a sustainability report, but also regulate the formalities of it to derive a common standard.
... In addition to their function of increasing transparency and mitigating potential asymmetry information, many critics of the presentation of CSR reports see them as little more than a public relations tool, which raises the concerns of Unerman et al. (2010) that CSR reports are deliberately designed to manage stakeholders' perceptions and to maintain stakeholders' approval of business survival. Thorne et al. (2014) also draw attention to how a firm's motivation to publish a CSR report is to merely manage political and media visibility. ...
Article
Purpose This study aims to investigate the relationship between social impact, corporate social responsibility (CSR) reporting and firm performance in the context of the Association of Southeast Asian Nations (ASEAN) banking industry, providing insight into CSR-performance nexus debate, especially for non-environmentally sensitive industry (NESI). Design/methodology/approach We use a sample of 27 publicly listed banks in five ASEAN member countries (i.e. Indonesia, Malaysia, Singapore, Philippines and Thailand), with the period of observations ranged from 2011 to 2019 year. This study also carefully accounts for endogeneity issues and the dynamics of social impact – CSR reporting – bank financial performance relationship. Findings The results show that social impact (performance) and CSR reporting negatively associate with bank performance, either measured by accounting performance or market performance. The negative association between social performance and bank financial performance also persists in a longer-term relationship. This result implies that social performance and CSR might not have the expected result for banks in ASEAN developing countries and the expected effect also does not manifest in the following periods. Practical implications The negative association between social performance and financial performance implies that banks’ CSR in ASEAN might be misstargeted or that it takes more time to manifest the expected outcome. Therefore, banks should be able to foresee if social investment will finally offset the opportunity cost from diverting financial resources away from their core activities. On the other hand, policymakers must standardize the reporting related to social activities for banks and should bring the environmental and social issues to the depositors’ attention to show that these issues are also relevant in the banking industry. Originality/value To the best of the authors’ knowledge, this study is among the first to provide empirical evidence on the direct relationship between social impact, CSR reporting and firm performance in the context of ASEAN’s NESI. The results should be of potential interest value to ASEAN’s banks, regulators and shareholders.
... The dissemination of timely information could possibly enhance its perceived usefulness (Islam & Rahman, 2017). In a similar vein, online CSR disclosures can be appraised for the "timeliness of their information" (Thorne, Mahoney & Manetti, 2014). This discourse leads to the following hypothesis: ...
Article
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Large organizations, including listed businesses, financial service providers as well as public services entities are increasingly disclosing information on their environmental, social and governance (ESG) issues through corporate websites or via social media. Therefore, this research uses valid measures from the Elaboration Likelihood Model (ELM) to explore the individuals' attitudes toward online corporate social responsibility (CSR) communications. The data was gathered from a structured questionnaire among three hundred ninety-two respondents (n=392). A structural equations modeling partial least squares (SEM-PLS 3) approach was used to analyze the data. The findings revealed that the timeliness, relevance and accuracy of information as well as the source expertise were highly significant antecedents that were affecting the research participants' attitudes toward CSR communications. This contribution implies that there is scope for content curators to publish quality online information on their business activities to improve their trustworthiness and positive credentials among stakeholders.
... Scholars revealed that firm size as one of the attributes of company characteristics indicated a positive and significant correlation on the quantity and quality of SRP [1,2,10]. The correlation may be linked with the greater public scrutiny of large firms, which arguably pushed them to engage in SRP [19,2,20]. Secondly, by the absolute advantage, big firms possess in disseminating information. Communication is relatively less costly for larger firms, even though implementation of clean technologies requires huge investment [21]. ...
Article
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The paper examined the determinants of sustainability practice (SP) in Nigerian. Two main dimensions of the factors influencing sustainability practice were investigated. First, company characteristics, proxied by firm size (FSIZE), dividend per share (DIPS), Tobin's-Q (TOBQ), type of industry (IDTY), and profit after tax margin (NPTM). Secondly, the board characteristics, proxied by disclosure of board roles and function (DBRF), chairman roles in the board (DCRB), board members appointment date (BADT), shareholders engagement policy (DISS), and board meetings with attendance records (DMBM). The content analysis approach was introduced to extracted relevant data from 270 annual reports of the sample companies between 2011 and 2020. The Global Initiative Reports GRI (G4) index was used to examine these annual reports. The panel regression result exerts that all of the elements of board characteristics are important determinants of SRP in Nigeria. This suggests that factors related to the identity of companies might influence the disclosure for SRP, particularly when the disclosure is voluntary. Whereas, the proxies of the company characteristics except for DIPS, TOBQ, and IDTY are not important factors, which might be linked with the voluntary nature of sustainability practice in Nigeria. The results further reveal a low level of disclosure. The low rating and disclosure indicated that listed Nigerian firms are still behind when it comes to disclosing and reporting sustainability activities in line with the GRI-G4 guidelines. Therefore, the study is empirically and theoretically relevant, as it might be in need of investigating the commitments and contributions of Nigerian companies and institutions towards a sustainable world by 2030.
This study discusses competitive neutrality issues in light of government subsidies. We examine whether the engagement in overseas corporate social responsibility practices affect the ability of private multinational enterprises in emerging markets in order to compete with state-owned multinational enterprises for government subsidies. Using a sample of Chinese multinational enterprises operating between 2008 and 2018, our results indicate that the competitive advantage of state-owned multinational enterprises in obtaining government subsidies is offset when private multinational enterprises actively engage in overseas corporate social responsibility practices. Furthermore, institutional distance and the expectations set by the home country as they relate to sustainable development significantly affects the ability of multinational enterprises to receive subsidies.
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Corporate reports containing non-financial information are the main tool that organisations can use to communicate information concerning their sustainability performance to their stakeholders. The use of graphic media to transmit this information is increasingly present in most of these reports, since people recognise and understand this information more quickly than information represented by text. However, there is not a consensus in the use of icons, colours or forms, etc. for that purpose. The objective of this study is to analyse the way in which organisations are currently communicating sustainability information graphically, in order to identify the existence of common design patterns. To do so, the graphic information included in 80 corporate reports was analysed. A total of 997 icons were identified, grouped in 8 environmental indicators, 19 social indicators, 1 economic indicator and 4 stakeholders. In addition to the concept represented graphically, aspects such as the form of composition, border shape or colour, among others, were analysed. It was found that there is a clear lack of standardisation when communicating the sustainability performance graphically, and also a clear need for a family of icons that allow a direct and unequivocal association of the icon and the corresponding sustainability indicator. This would facilitate the effective and efficient communication of sustainable information through corporate reports.
Article
This case study adopts a positivist perspective to examine how Petroleo Brasileiro S.A (“Petrobras”), a high-profile company in its native Brazil with multiple listings including in Brazil and the US, responded to a major corruption scandal arising in 2014. We consider Petrobras’s response both in terms of its visible activities – i.e. in relation to anti-corruption and compliance (“ACC”) disclosures in its annual report (AR) and sustainability report (SR), as well as actioned remedial policies that constitute the crisis plan – and how the company went about interacting with stakeholders during and after the immediate crisis period. We conducted a content analysis of ACC disclosures and assessed Petrobras’s remedial activities in the eight-year period 2010 – 2017 as disclosed in its ARs, SRs and press releases. We find firstly that, consistent with legitimacy theory, Petrobras responded by voluntarily and substantially increasing its relevant disclosures so as to regain legitimacy, a finding which mirrors those found elsewhere following corruption and environmental crises. Secondly, the unique corporate governance situation at Petrobras combined with the fact that leadership was allegedly implicated in the scandal, led the post-crisis management team to undertake a series of remedial actions that prioritised the need to take and maintain executive control and independence from the government, whilst at the same time carefully managing the relationship with this influential stakeholder: - actions which argue strongly in favour of stakeholder-agency theory and multiple agency theory interpretations of the nature of stakeholder interactions that transpired during the crisis period of disequilibrium, and which precluded the type of stakeholder dialogue seen in some previous environmental crisis situations. Finally, we show that Petrobras’s crisis management response actions align well with models of trust repair and legitimacy management, and suggest the company considered it had successfully regained legitimacy by 2017.
Article
This study endeavours to recognize the preparedness, advantages and pitfalls associated with International Financial Reporting Standards (IFRS) enforcement in India. The data have been complied using purposive sampling technique from 75 accounting individuals from diverse corporate sectors of India, and the research findings of the article convey that the whole accounting community is extremely positive about the advantages related to IFRS enforcement, but they too considered challenges a major roadblock towards smooth implementation. There are few studies available reporting the readiness towards this high-quality international accounting standards in India, which intrigued the authors to evaluate the readiness level in the country regarding IFRS-based Ind-AS. The current accounting system in India calls for extensive training in terms of IFRS technicalities, seminars and workshops on a large scale should be embarked upon by all educational institutions, accounting regulatory bodies, accounting professional organizations such as ICAI, KPMG and other accounting experts to impart and share knowledge about IFRS for a smooth enforcement of IFRS.
Article
Sustainability reporting is gaining attention among industry professionals and academics. However, it has been criticized since it fails to represent the proper reporting practices of firms, with this being described as symbolic in form. Regardless of this criticism, management of firms in East Africa is increasingly adopting sustainability reporting, despite being voluntary. Therefore, the paper analyzed the determinants of sustainability reporting of East African firms. Eight years of annual reports of 74 listed firms in Kenya, Tanzania, and Uganda were used. Random and fixed effect regression techniques were employed for the estimates. The study found that firms’ specific characteristics such as size, Tobin’s Q, industry affiliation, and ownership structure have a positive and significant influence on firms’ management to adopt sustainability reporting practices. In addition, it was suggested that firms with a more considerable asset and Tobin’s Q provide more sustainability reporting than those with smaller assets and Tobin’s Q. The results further showed that firms’ age and return on assets do not influence sustainability reporting. The evidence further demonstrated that firms with foreign parent companies significantly disclosed more sustainability information than local firms. The paper concludes that the firm-specific characteristics influence their sustainability reporting practice. The study provides policy implications because it can assist the governments and regulators in these countries in guiding the firms’ reporting practices.
Article
This study of Chinese listed firms from 2008 to 2018 shows that research and development (R&D) expenditure is associated with increased audit fees. However, corporate social responsibility (CSR) disclosure can attenuate this fee increase, especially in firms with an opaque information environment, high risks, and non‐high‐ and new‐technology enterprises. These findings are robust to the use of proxies and instrumental variables, propensity score matching, and controlling for firm fixed effects and CSR performance. This study contributes to the understanding of the economic consequences of R&D activities, determinants of audit fees, and CSR disclosure.
Article
This study aims to investigate whether the corporate governance (CG) moderates the link between corporate social responsibility (CSR) and firm value (FV). For this purpose, anatomization was conducted by extracting data from the published annual reports of non-financial firms listed on the Pakistan Stock Exchange. Correlation, regression, and moderation analyses were conducted to obtain the statistical outcomes. The results showed a significant direct relationship between CSR and firm performance. Additionally, it was found that the interactivity between CSR and FV weakened when CG was included as a moderator. The results of this study could be used by stakeholders to make economically sound decisions since it provides complete guidance regarding how to engage in productive CSR activities. Moreover, this study contributes to future research by examining the association between CSR and FV using CG as a moderator, in a market where, as in other developing markets, this relationship has not been the focus of research. Apart from its theoretical contributions, this study explores the role of CG as moderator, in line with research conducted in under-developed markets, which may be considered a significant contribution.
Article
Using a unique setting of exogenous variations in non‐compete agreement (NCA) enforceability in the United States, we investigate whether companies strategically engage in corporate social responsibility (CSR) practices to retain employees. Using a difference‐in‐differences design, we find that an increase in the enforceability of NCAs deteriorates CSR performance. Cross‐sectional tests indicate that peer pressure affects CSR performance interactively with enforceability of NCAs. These findings demonstrate the unintended consequences of regulation and are consistent with the notion that firms strategically engage in CSR practices to retain employees, thereby reducing knowledge spillover associated with employee mobility.
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This study investigates the need for SMEs to practice corporate social responsibility (CSR) in building their brand image in Ghana. The study aims at exploring the role impact of Corporate Social Responsibility (CSR) in building small and medium enterprises (SMEs) brand image in Ghana. Evaluating the role of CSR in building the brand image of SMEs adopted research designs/methods and approached to solicit both secondary and primary data. To identify the perceptions held by SMEs, motives for CSR practices, benefits associated with CSR practices, and the impact of Corporate Social Responsibility on SMEs' Brand Image, questionnaires and interviews were conducted with SMEs operators and Environmental Protection Agency officials in the Kumasi metropolis. The findings show that SMEs perceived CSR as a means of paying back to society what has been received as profit and also as a means of protecting and improving the quality of the natural environment as well as spending revenue to the state. It was noted that organizations practice Corporate Social Responsibility (CSR) to project the right corporate image, used as a marketing strategy, and to make employees happy and satisfied Benefits from CSR regarding customer loyalty, gaining goodwill from the community, enhanced government relations, and building client relations was also ascertained. Despite the numerous benefits associated with CSR activities, other challenges were also identified as free giveaway products and the high cost of CSR programs. Some suggestions such as the honest provision of accurate information about the SMEs products, organizing programs to suit students, a regular donation to the societies, and total collaboration between SMEs and their communities were made to promote firms' image through CSR practices.
Article
In the early stages of their ventures, social entrepreneurs often struggle to attract financing in traditional financial markets and therefore use new markets, such as crowdfunding platforms. Based on two experimental studies, I examine how two different signalling strategies—the social entrepreneur’s reputation (based on awards, fellowships, and prizes) and accountability (based on a social impact measurement system)—influence crowdfunders’ decisions when evaluating an early-stage social venture. In the first 2 × 2 between-subjects experiment, I find an interaction suggesting that accountability increases the funding amount provided by crowdfunders only when the social entrepreneur does not signal a strong reputation. In a follow-up 1 × 2 between-subjects experiment, I replicate the negative effect of reputation. However, based on qualitative data, I do not find that crowdfunders consciously evaluate reputation based on awards, fellowships, and prizes as a negative signal. Overall, the results suggest that signalling accountability based on implementing a social impact measurement system is a better strategy for crowdfunding campaigns than investing in reputation building or sending both signals simultaneously in the early stages of a social venture.
Article
We examine how managers orchestrate their eco-control package in reaction to different perceived environmental stakeholder pressures. Using survey data from Canadian manufacturing firms, our results show that environmental pressures perceived from societal stakeholders have a greater influence on the integration of environmental objectives into strategic planning than pressures perceived from business stakeholders. This suggests that business stakeholders act as a force that mostly maintains the scope of strategic environmental orientations, while societal stakeholders act as a force that mostly expands the scope of strategic orientations by stimulating further consideration of environmental issues as strategic objectives. The integration of environmental objectives in strategic planning stimulates a domino effect within the eco-control package, where the adaptation of strategic objectives leads to greater mobilization of other eco-controls. This domino effect represents successive effects among components of the eco-control package, revealing how stakeholder pressures play a role in stimulating multi-layered changes in eco-control mobilization.
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Purpose – This paper develops a conceptual framework for extended external reporting (EER) influences (EERI), including Sustainability, Non-Financial, Integrated, and Value Reporting. Using the Environmental Legitimacy, Accountability, and Proactivity (ELAP) framework as the base, we modify its proposed concepts and linkages using relevant conceptual models, prior reviews, and findings of recent studies on EER. The paper presents contributions of the special issue on “non-financial and integrated reporting, governance and value creation” and avenues for future research. Design/methodology/approach – Drawing on relevant conceptual models, prior reviews, and recent EER studies, we reframed the ELAP framework into a framework that theorises the factors that affects, or are affected by, EER. Findings – The EERI framework poses relationships between and within proactivity, external verification, accountability, and legitimacy. It also consolidates possible determinants and consequences of EER. The papers published in this special issue contribute further insights on factors that influence reporting practices, processes and suggestions for capturing and communicating value creation information, and the value of integrated reports and assurance to capital providers. Originality/value – Along with the insights provided by papers in this special issue, the conceptual framework can be used to theorise influences of EER and guide future research.
Article
This study investigates voluntary sustainability reporting by U.S. universities. Using a structural equation modeling approach and Poisson regression, this analysis explores the relevant motivations for and obstacles in disclosing sustainability information through the Sustainability Tracking, Assessment & Rating System (STARS). The preparation of sustainability reports on a voluntarily basis involves significant financial costs for universities that typically grapple with tight budgets. However, universities may want to inform their stakeholders about relevant developments at the university. The results show that the fulfillment of societal expectations is one of the most relevant motivations, whereas a lack of reporting-related organizational structures represents the most important obstacle. The study provides important theoretical and practical contributions to the literature, including scales that measure the level of motivations and obstacles to reporting sustainability information. Furthermore, the findings can improve universities’ sustainability reporting and assessment frameworks.
Article
This study explores the prevalence of CSR reporting practice in the Arab region (Arab countries in the Middle East) and highlights the possible causes that affect companies to commit to this practice. The study includes thirteen countries in the region. It identifies the listed companies that publish stand-alone CSR reports, analyses the companies’ characteristics, and the effect of four independent variables on the commitment to CSR reporting, measured by continuity in publishing these reports. The four independent variables include: being a large company, having a global presence, belonging to an environmentally sensitive industry, and belonging to a highly visible industry. The Qualitative Comparative Analysis method is used for causal analysis. Theoretical analysis is informed by institutional theory. Findings show that CSR reporting is still at its early stages in the region. CSR reporting is driven by linkages and openness to the global economy or by high public visibility (because of size and belonging to visible industries) while belonging to environmentally sensitive industries seems not to affect CSR reporting. These findings support the view that CSR reporting is a global practice adopted by companies in developing countries either to respond to global stakeholders or to imitate a global trend.
Chapter
The purpose of this research paper is to review the complete CSR literature laying emphasis on CSR constructs and the theoretical perspectives in Pakistan. Collation of existing empirical and exploratory research has been used to make arguments about current status of academic CSR research. A total of sixty-five published articles on CSR from 2000 to 2021 have been reviewed. A thorough overview of CSR constructs highlighted that overall, the CSR constructs are not properly developed, and theoretical foundations are lacking. Corporate donations and philanthropy captured as CSR construct are still familiar among the researchers. It has been observed that the most recent literature is approaching towards maturity. The findings suggest that the lack of adequate explanation of theoretical foundations mislead the interpretation of results. There is partial support in the literature that CSR pays to the firms, as is depicted by the positive relationship between CSR and the facets investigated by the researchers but thorough emphasis is required on CSR measurement. The research can serve as basis for the beginning of an extensive exploration of CSR through the lens of theoretical perspectives and the strong theoretical foundations can result in a mature CSR construct and major contribution in the body of literature.
Article
Purpose The paper examines whether, along with the financial performance, the disclosure of research and development (R&D) expenses, patent portfolios, patent citations and innovation activities affect the market capitalization of Russian companies. Design/methodology/approach The paper opted for a set of techniques including bag-of-words (BoW) to retrieve additional innovation-related data from companies' annual reports, self-organizing maps (SOM) to perform visual exploratory analysis and panel data regression (PDR) to conduct confirmatory analysis using data on 74 Russian publicly traded companies for the period 2013–2019. Findings The paper observes that the disclosure of nonfinancial data on R&D, patents and primarily product and marketing innovations positively affects the market capitalization of the largest Russian companies, which are mainly focused on energy, raw materials and utilities and are operating on international markets. The study suggests that these companies are financially well-resourced to innovate at risk and thus to provide positive signals to stakeholders and external agents. Research limitations/implications Our findings are important to management, investors, financial analysts, regulators and various agencies providing guidance on corporate governance and sustainability reporting. However, the authors acknowledge that the research results may lack generalizability due to the sample covering a single national context. Researchers are encouraged to test the proposed approach further on other countries' data by using the compiled lexicons. Originality/value The study aims to expand the domains of signaling theory and market valuation by providing new insights into the impact that companies' reporting on R&D, patents and innovation activities has on market capitalization. New nonfinancial factors that previous research does not investigate – innovation disclosure indicators (IDI) – are tested.
Article
Purpose This paper aims to study companies’ strategic responses to regulative institutional pressures on sustainability reporting. Particularly, it investigates the role of multiple stakeholder demands in shaping corporate responses to Law 11/2018 that transposes the EU Non-Financial Reporting Directive in Spain. Design/methodology/approach Informed by Oliver’s framework, the study analyzes the 2018 non-financial information of Spanish listed companies mandated to report under Law 11/2018 to explore the relationship between adopting a particular strategic response and companies’ stakeholder configuration. Findings Companies facing multiple stakeholder pressures tend to use a compromise strategy favoring the disclosure of relevant topics to a specific stakeholder type. Specifically, environmentalists are the most influential stakeholder in determining the coverage of sustainability topics to the detriment of other stakeholders when companies suffer from regulatory pressures. Research limitations/implications The study contributes to disentangling the factors determining how companies respond to sustainability reporting regulation. Future research could perform longitudinal and large multinational analyses to study the evolutionary process of corporate responses. Practical implications The study is relevant to managers and policymakers as it highlights that sustainability reporting regulation should promote the coverage of relevant topics to less influential stakeholders. Social implications The study explores the extent to which current sustainability reporting regulation can increase transparency on sustainability issues for all stakeholders. Originality/value In contrast to previous literature exploring the extent to which firms comply with regulation, the study considers that companies can respond more actively to mandatory sustainability reporting requirements.
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This study investigates the impact of managerial risk-reducing incentives on the firm’s social and exchange capital. Using CEO inside debt holdings to proxy for the incentives of risk-averse managers, we find that CEOs with more inside debt holdings are likely to invest more in building social capital, which targets broader society and potentially offers anti-risk protection advantages, to shield the value of their inside debt. However, our results further show that managerial risk-reducing incentives have no impact on firms’ exchange capital, suggesting the need to recognise the difference between social and exchange capital. These findings corroborate the view that CEOs invest in social capital as a risk management strategy. Furthermore, this paper presents an understanding of the role that institutional investors play in moderating the impact of managerial risk-reducing incentives on social capital. Our results suggest that institutional investors constrain CEOs that have greater inside debt incentives from investing in social capital. However, they are still willing to increase the investment in social capital for risk management purposes when firm risk is high.
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Offered here is a conceptual model that comprehensively describes essential aspects of corporate social performance (CSP). The three dimensional model address major questions of concern: (1) What is included in the definition of CSR? (2) What are the social/stakeholder issues the firm must address? and (3) What is the organization's strategy/mode/philosophy of social responsiveness. The first dimension is the source of the original four-part definition of CSR originated: economic, legal, ethical, and discretionary (later termed philanthropic). It was later presented at the CSR Pyramid (1991).
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This paper analyzes how national institutional factors affect the adoption of the international environmental management standard ISO 14001, using a panel of 139 countries from 1996 to 2006. The analysis emphasizes that during the emerging phase of the standard, the potential lack of consensus within the constituents of the national institutional environment concerning the value of a new standard could send mixed signals to firms about the standard. The results show that in the early phase of adoption, regulative and normative forces within the institutional environment can work against each other. Results also show that regulative or coercive forces play a relatively more important role in the early phase of adoption of the standard than in the subsequent phases of diffusion. In the later phases of diffusion of ISO 14001, normative forces, such as the diffusion of other management standards, as well as factors related to trade, play a more important role. Because of the similarities between environmental management standards and corporate social responsibility standards, this study can help identify some of the challenges for diffusion of ISO management standards in the area of social responsibility.
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Management system standards, also called meta‐standards, have been adopted by an increasing number of organizations across the world. Although these management system standards are based on the same type of management principles and institutional arrangements, the literature remains scattered, with diverse studies focused on specific standards and published in various journals. The main objective of this paper is to analyse the academic research on meta‐standards through an integrative review intended to shed light on the main conclusions and substantial advances made in this area. This integrative review focuses more specifically on the two main meta‐standards which have been adopted by more than 1.3 million organizations worldwide: ISO 14001 and ISO 9001. The paper contributes insights into the main streams of the literature and current knowledge gaps to be addressed in future research on the various issues related to meta‐standards: global governance, diffusion processes, motivations, benefits of adoption and impacts on performance, internalization, integration, consultancy and auditing.
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Forty-five percent of the Fortune global top 250 companies (GFT250) are now issuing environmental, social or sustainability reports in addition to their financial reports. Globally, more companies than ever are publishing reports on their environmental, social and sustainability performance and an increasing number are having these reports independently verified. These are some of the findings of a comprehensive survey of corporate sustainability reports by KPMG's Global Sustainability Services, in collaboration with the Graduate Business School of the University of Amsterdam. Similar surveys were held in 1993, 1996 and 1999. The 2002 survey also reveals that: Of the GFT250 companies surveyed, 45 percent published a separate corporate report on their performance, compared to 35 percent in 1999. Of the top 100 companies in each of the 19 countries surveyed, Japan has the highest percentage (72 percent) of companies producing corporate reports, followed by the UK (49 percent), USA (36 percent), Netherlands (35 percent), Finland (32 percent) and Germany (32 percent). Health, Safety and Environment (HSE) are still the most common types of report, but others are emerging including sustainability and social reports.
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This article extends earlier research concerning the relationship between corporate social performance and corporate financial performance, with particular emphasis on methodological inconsistencies. Research in this area is extended in three critical areas. First, it focuses on a particular industry, the chemical industry. Second, it uses multiple sources of data-two that are perceptual based (KLD Index and Fortune reputation survey), and two that are performance based (TRI database and corporate philanthropy) in order to triangulate toward assessing corporate social performance. Third, it uses the five most commonly applied accounting measures in the corporate social performance and corporate financial performance (CSP/CFP) literature to assess corporate financial performance. The results indicate that the a priori use of measures may actually predetermine the CSP/CFP relationship outcome. Surprisingly, Fortune and KLD indices very closely track one another, whereas TRI and corporate philanthropy differentiate between high and low social performers and do not correlate to the firm's financial performance.
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Over the last years, sustainable development has become one of the major issues that all global organizations are facing. The Global Reporting Initiative, located in the Netherlands and considered the leading authority world-wide, has developed what is currently considered the "common framework for sustainability reporting". The latest version of their reporting guidelines called G3 contains detailed instructions and standards on how to prepare sustainability reports. By using G3 guidelines, corporations show a strong commitment of continuous improvement of their sustainability reporting practices. The G3 guidelines are increasingly adopted by many global corporations and organizations. At present, more than 700 organizations voluntarily publish a sustainability report according to G3 guidelines . For the first time, this empirical study investigates if the better performing and/or governed corporations prepare their sustainability reports according to the G3 guidelines. The goal of this study is to determine if there are significant differences with regard to size, financial performance, capital structure, and corporate governance between firms that publish a G3 sustainability report to those that don't. Therefore, quantitative and qualitative variables of 124 randomly selected G3 reporting and non-G3 reporting corporations from 25 countries were analyzed. The results of this analysis show that corporations with the characteristics of being located in Europe, and/or being active in the energy or producing sector, and/or with a higher profit margin are more likely to produce high quality sustainability reports. Corporations with a higher long-term growth rate, on the other hand, are less likely to produce sustainability reports. The results of this unique study contribute directly to the knowledge of corporations providing voluntary CSR information in form of high quality sustainability reports and the importance of the development of globally accepted sustainability reporting standards.
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Offered here is a conceptual model that comprehensively describes essential aspects of corporate social performance. The three aspects of the model address major questions of concern to academics and managers alike: (1) What is included in corporate social responsibility? (2) What are the social issues the organization must address? and (3) What is the organization's philosophy or mode of social responsiveness?
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This chapter empirically examines factors associated with the environmental disclosures made by Canadian manufacturing firms in their 1993 annual reports. Existing studies suggest that corporate environmental information is value-relevant and that firms may disclose such information in a strategic fashion. This study examines the extent to which voluntary disclosure theory can explain corporate disclosure of general and financial environmental information. We find that firms with more news media coverage of their environmental exposure, higher pollution propensity, and more political exposure are more likely to disclose general environmental information. These findings are consistent with the predictions of the voluntary disclosure literature. We also find that disclosure of financial information about corporate environmental impact is influenced less by voluntary disclosure factors than is general disclosure.
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In this paper we explore how multinational corporations (MNCs) adopt assurance practices to develop and sustain organizational accountability for sustainability. Using a panel of Fortune Global 250 firms over a period of ten years, we document the diffusion patterns of third-party assurance of sustainability reports. We specifically investigate how evolving auditing practices, namely diversity of assurance standards and type of assurance providers, shape the quality of sustainability assurance statements. The results illustrate great variability in the adoption of assurance practices in the formative stages of this novel market. Our descriptive analysis indicates the relevance of external institutional pressures as well as internal resources and capabilities as underlying factors driving the adoption of assurance. Our evidence also suggests that several MNCs project a decoupled or symbolic image of accountability through assurance, thereby undermining the credibility of these verification practices. The paper contributes to the emerging literature on international accountability standards and emphasizes the need to enhance theory-based, cross-disciplinary knowledge related to auditing and accountability processes for sustainability.
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Offered here is a conceptual model that comprehensively describes essential aspects of corporate social performance. The three aspects of the model address major questions of concern to academics and managers alike: (1) What is included in corporate social responsibility? (2) What are the social issues the organization must address? and (3) What is the organization's philosophy or mode of social responsiveness?
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This paper investigates the extent to which certification auditing can contribute to the realization of organizational accountability for sustainable development. A theoretical framework based on a critical analysis of financial and ISO auditing practices is proposed to shed light on the misconceptions, paradoxes and rational myths underlying the institutionalization of auditing practices in the area of corporate sustainability. As such, this paper casts doubt on the imagery of impartiality, rigor and accountability projected by organizations through discourses of certification. It also illustrates the pertinence of studying the auditing function from a cross-disciplinary viewpoint, and of paying attention to the processes by which auditing travels from one discipline to another. Copyright © 2010 John Wiley & Sons, Ltd and ERP Environment.
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The aim of this study is to illustrate what and how stand-alone Corporate Social Responsibility (CSR) reports and web information provide to readers. These characteristics are recorded in predetermined schemes. The study focuses on the telecommunication sector, especially on fixed and mobile telephony and internet access providers in the Greek market. In all, five companies that provide CSR reports are identified. Their characteristics are categorized by four main predetermined dimensions, namely: type of communication, context, indicators and distinctions. The content analysis technique is selected as it is widely accepted and used in the field of CSR report research. The analysis indicates that three annual reports are almost similar in all dimensions and sub-dimensions. All of the companies publish their management systems certifications and awards and both Greek and English information versions exist; however, there are contradictory results in the dimension of indicators, the sub-dimensions of report guidelines and stand-alone reports. The value of the paper is to promote the standardization of CSR report.
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We address the question of how and why corporate social responsibility (CSR) differs among countries and how and why it changes. Applying two schools of thought in institutional theory we conceptualize, first, the differences between CSR in the USA and Europe and, second, the recent rise of CSR in Europe. We also delineate the potential of our framework for application to other parts of the global economy.
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A broad literature has emerged over the past decades demonstrating that firms’ environmental strategies and practices are influenced by stakeholders and institutional pressures. Such findings are consistent with institutional sociology, which emphasizes the importance of regulatory, normative and cognitive factors in shaping firms’ decisions to adopt specific organizational practices, above and beyond their technical efficiency. Similarly, institutional theory emphasizes legitimation processes and the tendency for institutionalized organizational structures and procedures to be taken for granted, regardless of their efficiency implications. However, the institutional perspective does not address the fundamental issue of business strategy necessary to explain the persistence of substantially different strategies among firms that are subjected to comparable levels of institutional pressures. In this chapter, we present current research arguing that such firms adopt heterogeneous sets of environmental management practices despite facing common institutional pressures because organizational characteristics lead managers to interpret these pressures differently.
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This article assesses the proliferation of international accountability standards (IAS) in the recent past. We provide a comprehensive overview about the different types of standards and discus their role as part of a new institutional infrastructure for corporate responsibility. Based on this, it is argued that IAS can advance corporate responsibility on a global level because they contribute to the closure of some omnipresent governance gaps. IAS also improve the preparedness of an organization to give an explanation and a justification to relevant stakeholders for its judgments, intentions, acts and omissions when appropriately called upon to do so. However, IAS also face a variety of problems impeding their potential to help address social and environmental issues. The contribution of the four articles in this Special Issue is discussed in the context of standards’ problems and opportunities to foster corporate responsibility. The article closes by outlining a research agenda to further develop and extend the scholarly debate around IAS.
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Globally, companies increasingly publish separate general purpose, non-financial (sustainability) reports. Some of these are independently assured and assurers may or may not be from the auditing profession. We seek to understand this emerging voluntary assurance market. Using a sample of 2,113 companies (from 31 countries) that produced sustainability reports between 2002-2004, we use sequential logit analysis to identify the factors associated with the decision to voluntarily purchase assurance and the choice of assurance provider. We hypothesize that a company's need to enhance credibility through assurance and choice of assurance provider will be a function of company, industry and country-related factors. Our results support the argument that companies seeking to enhance the credibility of their reports and build their corporate reputation are more likely to have their sustainability reports assured, although it does not matter whether the assurance provider comes from the auditing profession. We also find that companies operating in stakeholder orientated countries are more likely to choose the auditing profession as an assurer.
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Purpose – This paper aims to analyze so‐called sustainability, corporate social responsibility or citizenship reports, as artefacts of a compromise between an institutional entrepreneur (IE), the Global Reporting Initiative (GRI), and companies. Some companies take on this invitation but to which extent the information they produce as a result corresponds to the ideal promoted by the IE? Design/methodology/approach – A sample of ten reports from Canadian companies were analyzed using a combination of deductive and inductive coding techniques. The discourse and pictures were analyzed to identify whether they represent path creation (adherence to the sustainability ideal) or path dependence (the expression of traditional business interests and practices). Findings – The study findings show that companies adopt the sustainability reporting guideline and ideal promoted by IE, but only partially. Path dependence and path creation are in tension, a condition typical of innovative processes according to the actor network theory (ANT) framework. It suggests that the market for sustainability information is under construction. Originality/value – The value of the paper is that it examines voluntary disclosure of social and environmental performance by companies, using the notion of IE from the neo‐institutionalist theory, as well as the innovation model from the ANT. The originality of the paper also lies in its methodology – particularly the use of a mixed method—including the composition of “poems” with “verses” extracted from the corporate reports.
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Purpose – The purpose of this paper is to explore the proposition that corporate social responsibility reporting could be viewed as both an outcome of, and part of reputation risk management processes. Design/methodology/approach – The paper draws heavily on management research. In addition, an image restoration framework is introduced. Findings – The concept of reputation risk management could assist in the understanding of corporate social responsibility reporting practice. Originality/value – This paper explores the link between reputation risk management and existing theorising in social accounting.
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ISO 14001, released in 1996, provides the basic framework for the establishment of an Environmental Management System (EMS) that can be audited and certified. ISO is not only an acronym for the International Organization for Standardization, but is also a term that refers to its Greek meaning: ‘equal.’ The main rationale for the creation of ISO 14001 was that its worldwide acceptance should facilitate international trade by harmonizing otherwise diffuse environmental management standards and by providing an internationally accepted blueprint for sustainable development, pollution prevention, and compliance assurance. However, the implementation of ISO 14001 varies significantly across the globe. A significant number of firms have adopted ISO 14001 in Western Europe and Asia. In December 1999, 52% of the 14,106 ISO 14001 certified facilities were located in Western Europe and 36% in Asia. On the contrary, very few American companies have adopted this voluntary standard. U.S. certified facilities accounted for only 4.5% of the total of ISO 14001 certified facilities in the world in December 1999. The U.S. institutional environment seems acting as a deterrent to ISO 14000 adoption as U.S. companies are fearful of the certification process which lays their performance open to public scrutiny. The opposite is true in Europe, where governments have encouraged the adoption of environmental management standards by setting up a trusted certification system and providing technical assistance to potential adopters. This paper offers a conceptual framework to analyze this variation in adoption rates. It is proposed that the regulatory, normative and cognitive aspects of a country's institutional environment greatly impact the costs and potential benefits of ISO 14001 adoption and therefore explain the differences in adoption across countries. The analysis is supported by data collected from a phone questionnaire to 140 firms in Europe and a questionnaire mailed to 152 firms in the U.S.
Article
Researchers have reported a positive, negative, and neutral impact of corporate social responsibility (CSR) on financial performance. This inconsistency may be due to flawed empirical analysis. In this paper, we demonstrate a particular flaw in existing econometric studies of the relationship between social and financial performance. These studies estimate the effect of CSR by regressing firm performance on corporate social performance, and several control variables. This model is misspecified because it does not control for investment in R&D, which has been shown to be an important determinant of firm performance. This misspecification results in upwardly biased estimates of the financial impact of CSR. When the model is properly specified, we find that CSR has a neutral impact on financial performance. Copyright © 2000 John Wiley & Sons, Ltd.
Book
The globalization process has foregrounded ethnic discrimination as an increasingly important area of law around the world. Allowing a better understanding of the issue of ethnic discrimination and inequality, this book offers a comparative analysis of legislation impacting ethnic equality in various Anglophone countries. It demonstrates that it is possible to achieve equality at both national and international levels. A compelling historical analysis of the North American Free Trade Agreement and the European Union Treaty is provided together with a detailed examination of diversity and the law. The book will interest practitioners and others interested in ethnic legal issues.
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This study reports the results of a behavioral experiment examining whether financial analysts from Australia, the United States, and the United Kingdom perceive a difference in the credibility of stand-alone corporate social responsibility (CSR) reports depending on whether they are assured, and the type of assurance provider (professional accountants versus sustainability consultants). We further examine whether the perceived credibility differs for financial analysts from the different countries and whether results hold for companies from different industries. The overall results show the credibility of a CSR report is greater when it is assured and when the assurer is a professional accountant. While assurance increases the credibility of the information in each of the three countries included, the relative impact is context-specific. Information is perceived to be more credible when a company is from an industry where assurance is more commonplace, and by financial analysts from the United States when the assurer is a professional accountant. Financial analysts from Australia and the United Kingdom perceive little difference in the enhanced credibility provided by the different assurance providers. Data Availability: Contact the first author about the availability of the data.
Article
While many sociologists have noted that organizational legitimacy is important for organizational survival, legitimacy has been infrequently empirically examined. This paper presents a conceptual framework in which organizational legitimacy is defined as the congruence between the values associated with the organization and the values of its environment. Challenges to organizational legitimacy and responses to these challenges are illustrated in a discussion of the American Institute for Foreign Study. Corporate philanthropic contributions, the composition and size of boards of directors, and the content of annual reports and other organizational communications are presented as efforts on the part of organizations to achieve legitimacy. The focus on processes of organizational legitimation can be used in analyzing a variety of organizational behaviors that are components of organization-environment interaction.
Article
The main purpose of this exploratory analysis is to understand whether, based on evidence gathered from international best practices selected among corporations which adopt the Global Reporting Initiative guidelines in sustainability reporting (SR), stakeholders are significantly consulted and involved—as international literature would indicate—by assurance providers, during assurance processes of SR. We aim at verifying if this practice—known as stakeholder assurance—is in fact widespread in SR assurance by carrying out empirical research, through content analysis, into a sample of 161 assurance statements of international corporations, in order to test characteristics of any stakeholder assurance implemented.
Article
Various rationales have been advanced to explain the phenomenon of corporate social reporting. Among these has been legitimacy theory which posits that corporate disclosures are made as reactions to environmental factors and in order to legitimise corporate actions. This paper reports the results of an historical analysis of social disclosures in 100 years of annual reporting by a dominant corporation in the Australian mining/manufacturing industry. A variable but significant pattern of social reporting is identified and compared with an earlier study of social reporting by US Steel. The results of this study fail to confirm legitimacy theory as the primary explanation for social reporting in the Australian case.
The decision to disclose social information in annual reports is a voluntary one. A positive model of the factors that may influence firms' decisions to disclose social information is proposed. It is hypothesised that the decision may be affected by (a) social performance, (b) political visibility, (c) financial variables, and (d) economic performance. It is found that the decision to disclose social information is well explained by the model and that the key explanatory variables are social performance and political visibility.
Article
Purpose – The paper attempts to determine whether market participants see value in the corporate choice to begin publishing a standalone sustainability report. It also seeks to investigate whether differences in market reactions are associated with the quality of the sustainability report. Design/methodology/approach – The paper uses standard market model methods to isolate the unexpected change in market returns in the period surrounding the announcement of the release of a first-time sustainability report. Findings – The paper finds, on average, no significant market reaction to the announcement of the release of the sustainability reports. However, in cross-sectional analyses, it is found that companies with the highest quality reports exhibited significantly more positive market reactions than companies issuing lower quality reports. These results hold when we control for firm size and membership in socially exposed industries. Research limitations/implications – The paper examines only the US firms and the measure of quality is based on an assessment of the extent to which reports provide disclosures recommended by the Global Reporting Initiative. The sample is also relatively small. Finally, the analysis examines perceived value for only one potential stakeholder group – shareholders. Future research could address any of these shortcomings. Practical implications – The evidence suggests that companies seeking value from their sustainability reporting need to carefully consider the quality of their presentations. Originality/value – The finding that quality of sustainability reporting is important to investors provides valuable evidence to support improvements in the implementation of sustainability accounting and reporting.
Takes as its departure point the criticism of Guthrie and Parker by Arnold and the Tinker et al. critique of Gray et al. Following an extensive review of the corporate social reporting literature, its major theoretical preoccupations and empirical conclusions, attempts to re-examine the theoretical tensions that exist between “classical” political economy interpretations of social disclosure and those from more “bourgeois” perspectives. Argues that political economy, legitimacy theory and stakeholder theory need not be competitor theories but may, if analysed appropriately, be seen as alternative and mutually enriching theories from alternative levels of resolution. Offers evidence from 13 years of social disclosure by UK companies and attempts to interpret this from different levels of resolution. There is little doubt that social disclosure practice has changed dramatically in the period. The theoretical perspectives prove to offer different, but mutually enhancing, interpretations of these phenomena.
This paper serves as an introduction to this special issue of Accounting, Auditing & Accountability Journal; an issue which embraces themes associated with social and environmental reporting (SAR) and its role in maintaining or creating organisational legitimacy. In an effort to place this research in context the paper begins by making reference to contemporary trends occurring in social and environmental accounting research generally, and this is then followed by an overview of some of the many research questions which are currently being addressed in the area. Understanding motivations for disclosure is shown to be one of the issues attracting considerable research attention, and the desire to legitimise an organisation’s operations is in turn shown to be one of the many possible m