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© 2018 by the authors; licensee Growing Science, Canada
doi: 10.5267/j.msl.2018.4.005
Management Science Letters 8 (2018) 417–426
Contents lists available at GrowingScience
Management Science Letters
homepage: www.GrowingScience.com/msl
Corporate social responsibility practice of Malaysian public listed government-linked compa-
nies: A dimensional analysis
Lim Boon Keong
a*
, Suresh Ramakrishnan
b
and Sanil S. Hishan
c
aFaculty of Business and Management, Southern University College, Malaysia
a,b,cFaculty of Management, Universiti Teknologi Malaysia, Malaysia
C H R O N I C L E A B S T R A C T
Article history:
Received: November 26, 2017
Received in revised format:
March 31, 2018
Accepted: April 4, 2018
Available online:
April 5, 2018
This paper examines the corporate social responsibility (CSR) practices of the Malaysian public-
listed government-linked companies (GLCs) using a dimensional analysis. Four dimensions of
CSR activities, namely community, employees, environment and governance, are investigated to
study the latest CSR practice of GLCs in year 2016. Each dimension is divided into three subcat-
egories to further examine the performance of GLCs on a particular CSR area. This is the first
paper in Malaysia which uses CSR ratings (obtained from CSRHub database) to proxy for CSR
practice. None of the past literature has been found to adopt this approach. The findings show that
Malaysian public-listed GLCs performed better in community, employees and environment di-
mensions, whilst tend to underperform in governance dimension.
© 2018 by the authors; licensee Growing Science, Canada
Keywords:
Corporate social responsibility
CSR practice
CSR ratings
CSR dimensions
Public listed companies
Government-linked companies
CSRHub
1. Introduction
A government-linked company (GLC) is a private or public commercial company in which an existing
government owns a direct controlling stake of 50% or has a government as a shareholder (Siwar &
Harizan, 2009). In Malaysia, government-linked companies (GLCs) and government-linked investment
companies (GLICs) play a significant role in making up the backbone of national economic structure
and growth (Mariati & Kamarulzaman, 2005). With a mix of social and commercial objectives, they
serve a central and major role in providing important public utilities and services such as energy, finan-
cial services, telecommunications, transportation, etc. (Atan & Razali, 2013). GLCs are given special
advantages in terms of access to funds, tenders, and opportunities and therefore, subject to a greater
requirement to comply with the government policies, including additional social obligations, i.e. cor-
porate social responsibility (CSR). They are mandated to share the government responsibility in ful-
filling their public accountability by leading other public listed companies (PLCs) to have good corpo-
rate practices on social and environmental matters (Hawani et al., 2011; Gandhi et al., 2018).
418
In GLCs, government-appointed board of director members and senior management make major deci-
sions regarding contract awards, strategy, restructuring, financing, merger, acquisition and divestment
for GLCs either directly or through GLICs. The GLICs controlled GLCs by allocation of funds for their
investment (Bhatt, 2016). There are seven GLICs, namely, Employees Provident Fund, Khazanah Na-
tional Bhd, Kumpulan Wang Amanah Pencen, Lembaga Tabung Angkatan Tentera, Lembaga Tabung
Haji, Menteri Kewangan Diperbadankan and Permodalan Nasional Bhd. Ministry of Finance and
GLICs are investment arms of the government that allocated funds to GLCs (Putrajaya Committee on
GLC High Performance Transformation, 2013).
In 2006, CSR development in Malaysia made a big leap when the Prime Minister (PM) who was also
the Finance Minister in Budget Speech 2007/08 highlighted the requirements for PLCs to report on
their CSR activities to indoctrinate a socially responsible culture. Effective communicating and report-
ing will help Malaysian companies, including the GLCs, to gain public confidence and recognition,
help attract the interest of socially responsible investment funds and more effectively manage different
stakeholder expectations other than deliver financial and operational results (Shirley et al., 2009, Ra-
makrishnan et al. 2016). This was supported through the launch of The Silver Book by Putrajaya Com-
mittee on GLC (PCG) which provides the guidelines of CSR reporting to GLCs and the launch of CSR
framework for PLCs to make CSR reporting by Bursa Malaysia (BM) in 2006. These timely initiatives
are useful in positioning Malaysian companies in the globally competitive market using the CSR plat-
form.
The CSR framework and the Silver Book for the PLCs and GLCs are to help them in the practice of
CSR. However, they neither provide the complete story about CSR nor the answer. The guidelines
provided are not applicable uniformly to all sectors and companies as each has to align them with the
nature and purpose of business. The framework proposes four dimensions:
Environment: Biodiversity, Climate Change, Endangered Wildlife, Energy (Renewable Energy,
Energy Efficiency, Biofuel) and Waste Management;
Community: Children, Education (Schools Adoption Scheme), Employee Volunteerism, Grad-
uate Employment, Underprivileged and Youth Development;
Marketplace: Corporate Governance, Green Products, Ethical Procurement, Social Branding,
Stakeholder Engagement, Supplier Management and Vendor Development; and
Workplace: Employee Involvement, Gender Issues, Human Capital Development, Health &
Safety, Human Rights, Labour Rights, Quality of Life and Workplace Diversity.
In Malaysia, there is an absence of internationally adopted accounting standards for disclosing CSR
information. Therefore, CSR disclosures in Malaysia would be solely voluntary in nature and compa-
nies have full discretion in deciding what to disclose in annual reports. The lack of the international
CSR reporting standards such as GRI and KLD in Malaysia makes the research on the CSR practice of
Malaysian companies become limited. Very few studies were conducted specifically on GLCs’ CSR
practice through a dimensional analysis. None of the past literature applied CSR rating to proxy for
CSR practice in Malaysia.
The aim of this paper is to conduct a dimensional analysis on the CSR practice of public-listed GLCs
through the adoption of an international CSR rating developed by CSRHub. There are four dimensions
defined by CSRHub, namely community, employees, environment and governance. Each dimension is
further divided into three subcategories to study the specific regime of each CSR dimension. Three
research objectives are outlined:
(1) To identify the CSR dimension that GLCs performed the best (with the highest average CSR
rating).
L. B. Keong et al. / Management Science Letters 8 (2018)
419
(2) To identify the dimensional subcategory that GLCs performed the best (with the highest
average CSR rating).
(3) To examine GLCs from which sector/industry has the best CSR practice (with the highest
average CSR rating).
2. Literature review
The study accomplished by Teoh and Thong (1984) is one of the earliest and major studies on CSR
practice conducted in Malaysian context. The study surveyed a combination of one hundred foreign
and locally owned companies in Malaysia through a personal interview questionnaire on three CSR-
related issues: the concept of CSR, the nature and extent of corporate involvement in such activities
and the corporate social reporting. The results show that only 29 percent of the companies in the sample
reported on CSR practice in their annual report, in which the most frequently reported CSR dimensions
were human resource and products or services related issues. However, the study did not examine the
level of CSR practice and the extent of CSR disclosures. The results also show that foreign-owned
companies made more CSR disclosures than local Malaysian companies did.
Andrew (1989) studied 119 annual reports of public-listed companies in Malaysia and Singapore in
1983 through examining their level of CSR disclosures found a disappointing result as only 26% of the
companies engaged in CSR practice (Alamer et al., 2015a; 2015b). Large- and medium-sized compa-
nies were inclined to engage more in CSR practice as compared to smaller-sized companies. The most
frequently reported CSR dimension or theme was human resource related activities. Companies from
banking and finance industry in the sample exhibited higher CSR disclosures in the annual reports.
However, the study did not make any comparison between Malaysian and Singaporean companies in
relation to CSR practice. Therefore, the CSR practice in each individual nation remained unidentified.
Ahmad et al. (2003) examined 98 listed companies across different industries from the main board of
Kuala Lumpur Stock Exchange (KLSE) through content analysis on their annual reports. The results
showed that 84% of the companies engaged in CSR practice and made certain level of CSR disclosure.
Four dimensions of CSR (environment, community, marketplace and workplace) were studied and
found that 72.4% of the companies made disclosure on marketplace dimension in terms of products
and services subcategory, whilst 62.2% of the companies made disclosure on workplace dimension in
terms of employee subcategory. Companies from banking and finance industry also reported the highest
level of CSR disclosure as compared to other industries. Comparatively, Shirley et al. (2009) examined
the CSR web reporting made by 117 second board companies listed on Bursa Malaysia through content
analysis on their annual reports in 2006. Only 23.1% of the companies engaged in CSR practice and
made certain level of CSR disclosure. Out of the four dimensions, community dimension topped the
list followed by environment dimension, contrarily, marketplace is the least favorable one. Companies
from industrial products industry made the highest proportion of CSR disclosure. Hawani et al. (2011)
assessed the level of CSR disclosure of 44 GLCs listed on Bursa Malaysia by developing disclosure
index based on four general themes (human resource, marketplace, community and environment) of
CSR through content analysis found that there was a shift from human resource to marketplace from
2005 to 2006. Based on the analysis of marketplace dimension, GLCs showed more concern on the
subcategories of product quality and safety, research and design, shareholder communication channel
and customer service. The least favored dimension was environment.
3. Methodology
Based on the market capitalization as at the end of 2016, out of the top 100 PLCs on Bursa Malaysia,
37 were identified to be GLCs. 7 GLCs were excluded from the present study due to the unavailability
of data on CSRHub (CSR rating database). Therefore, a total of 30 GLCs were included (Appendix 1).
420
CSRHub is the world’s largest sustainability business intelligence database which provides remarkably
comprehensive and relevant CSR or Environmental, Social and Governance (ESG) information. The
database provides transparent ratings and rankings of 17,267 companies from 133 countries, driven by
525 industry-leading CSR/ESG data sources (https://www.csrhub.com/).
CSRHub measures the CSR performance of companies based on four categories/dimensions, namely
community, employees, environment and governance. Each dimension is further divided into three
main subcategories:
Community (Subcategories: Community Development & Philanthropy, Human Rights &
Supply Chain, Product)
Employees (Subcategories: Compensation & Benefits, Diversity & Labor Rights, Training,
Health & Safety)
Environment (Subcategories: Energy & Climate Change, Environment Policy & Reporting,
Resource Management)
Governance (Subcategories: Board, Leadership Ethics, Transparency & Reporting)
It can be challenging to provide consistent and relevant CSR ratings/scores to a broad range of compa-
nies originated from different nations and industries due to the following reasons. First, different data
sources track different topics in different ways. For example, one source might measure community
dimension by total amount of money it contributes to local charities while another might track it by
measuring the number of community activities involved by the company. Second, different sources use
various ways to quantify the CSR performance, for example, the use of numerical score, positive or
negative signs and relative rankings (such as “Top 100” or “Best Performing”) are some of the common
measures. Third, different countries apply different CSR reporting system and guidelines and it makes
the CSR performance of different countries not comparable.
With the attempt to minimize the above sources of bias and inconsistency, CSRHub develops its rating
system by using the following approach (CSRHub, 2017a):
Map to a central schema: CSR performance is divided into four main categories (or dimen-
sions) and twelve subcategories. An open-ended number of special issues is established to
hold those CSR issues that do not fit into the twelve subcategory schema.
Convert to a numeric scale: Each data item from different sources is converted into a posi-
tive rating on a 0 to 100 scale.
Normalize: To analyze the variations between the sources, scores from different data
sources for the same company are compared to determine the biases. The scores from a
source are then adjusted to remove bias and create a more consistent rating.
Aggregate: Each data source is weighted differently according to the estimate of its credi-
bility and value. All the available data on a company is then incorporated to generate base
ratings at the subcategory level and subsequently aggregated to generate the ratings for cat-
egory or dimension level.
Trim: Those companies that do not have sufficient CSR information will not be rated.
Map to other international reporting standards: To generate a more reliable rating, CSRHub
schema is mapped, for example, to the Global Reporting Initiative (GRI) G3.1 guideline.
(CSRHub, 2017b)
To proxy for the CSR performance of GLCs, CSR ratings for 30 Malaysian GLCs were retrieved from
CSRHub database. Average CSR ratings were then computed for each category (dimension), subcate-
gory and industry (sector).
L. B. Keong et al. / Management Science Letters 8 (2018)
421
4. Results and findings
Average CSR ratings of 30 GLCs listed on Bursa Malaysia for the year ending 2016 were computed
based on 4 dimensions and 12 subcategories. The results are as illustrated in Table 1.
Table 1
Average CSR Ratings based on Dimensions and Subcategories
Ranking
of Dimen-
sion
Dimensions/
Subcategories
Average CSR Rating Lowest Highest Stand-
ard De-
viation
1 Environment 64.67 53 92 9.57
Ener
gy
& Climate Chan
g
e67.93 50 93 11.24
Environment Policy & Reporting 64.03 51 95 8.35
Resource Management 61.87 41 91 11.88
2 Em
p
lo
y
ees 61.40 41 79 8.28
Diversit
y
& Labor Ri
g
hts 69.62 44 90 10.04
Training, Health & Safety 64.21 48 75 6.76
Compensation & Benefits 50.97 18 83 14.37
3 Communit
y
61.10 47 87 9.33
Communit
y
Develo
p
ment & Philanthro
py
63.53 44 91 9.97
Human Rights & Supply Chain 60.67 41 83 9.06
Product 53.05 37 66 7.76
4 Governance 55.37 36 84 9.81
Leadershi
p
Ethics 58.60 41 81 9.09
Boar
d
54.73 32 87 11.74
Transparency & Reporting 52.73 27 83 11.76
The CSR dimension that GLCs performed the best in 2016 was Environment, followed by Employees
and Community. The least favorable was Governance. Environment Dimension, with the highest aver-
age CSR rating, measures a company’s interactions with the environment at large, including the effi-
ciency in using natural resources, the impact of company’s operation on the Earth’s ecosystems, com-
pliance with environmental regulations, etc. On average, GLCs scored 64.67 points on this dimension.
Among the three subcategories, Energy and Climate Change received the highest average rating. This
subcategory specifies the company’s policies and strategies in addressing climate change, energy-effi-
cient operations, development of renewable energy and other alternative environmental technologies.
Employees Dimension includes the diversity of labor force, treatment of unions and labor rights, com-
pensation and benefits of employees, occupational training, health and safety issues, etc. On average,
GLCs scored 61.40 points on this dimension. Among the three subcategories, Diversity & Labor Rights
obtained the highest average rating. This subcategory evaluates a company’s workplace policies and
practices on fair and non-discriminatory treatments of employees and the ability to maintain diversity
by providing equal opportunities on promotion and benefits regardless of regardless of age, gender,
ethnicity, religion or sexual orientation, and promote work-life balance. Community Dimension covers
the company’s engagement in charitable giving and volunteerism, human rights and supply chain treat-
ment, development of environmental-friendly and sustainable products, etc. On average, GLCs scored
61.10 points in this dimension. Among the three subcategories, Community Development & Philan-
thropy obtained the highest average rating. This subcategory assesses how the company interacts with
the communities in which it does business.
Governance Dimension has the lowest average rating (i.e. 55.37 points) as Malaysian public-listed
GLCs tend to underperform on this dimension. This dimension includes board diversity, independence
and compensation, leadership ethics of management, company’s reporting practices and transparency
to its stakeholders, etc. All three subcategories have a relatively low average rating. Out of twelve
subcategories, GLCs performed the best in Diversity & Labor Rights, Energy & Climate Change and
Training, Health & Safety. However, they tend to underperform in Compensation & Benefits, Trans-
parency & Reporting and Product. Subcategory of Compensation & Benefits has the highest standard
422
deviation (14.37 points) represents an evident dispersion of CSR ratings among the GLCs in this sub-
category. Greater the value of standard deviation, larger the dispersion of CSR ratings. It is also con-
firmed by the largest difference between lowest and highest average CSR ratings, i.e. 18 and 83 respec-
tively. Ranking of twelve subcategories of CSR are exhibited in Table 2.
Table 2
Ranking of Subcategories with Average CSR Rating
Ranking Subcategory Dimension Average CSR
Rating
Low-
est
High-
est
Standard Devia-
tion
1 Diversity & Labor Rights Employees 69.62 44 90 10.04
2 Energy & Climate Change Environment 67.93 50 93 11.24
3 Training, Health & Safety Employees 64.21 48 75 6.76
4 Environment Policy & Reporting Environment 64.03 51 95 8.35
5 Community Development & Philan-
thropy
Community 63.53 44 91 9.97
6 Resource Management Environment 61.87 41 91 11.88
7 Human Rights & Supply Chain Community 60.67 41 83 9.06
8 Leadership Ethics Governance 58.6 41 81 9.09
9 Board Governance 54.73 32 87 11.74
10 Product Community 53.05 37 66 7.76
11 Transparency & Reporting Governance 52.73 27 83 11.76
12 Compensation & Benefits Employees 50.97 18 83 14.37
Descriptive statistics on the number of GLCs originated from different sectors, with an average CSR
rating for each sector are as illustrated in Table 3.
Table 3
Average CSR Ratings based on Industries/Sectors
Industr
y
/Secto
r
N
o. of GLCs Percenta
g
e on Total Avera
g
e CSR Ratin
g
Standard Deviation
Tradin
g
/Services 14 46.67% 59.70 5.10
Finance 5 16.67% 59.66 7.99
Properties 3 10.00% 58.96 11.49
Consumer Products 2 6.67% 69.25 5.30
Construction 2 6.67% 58.06 6.42
Plantation 1 3.33% 52.19 5.47
Industrial Products 1 3.33% 56.75 6.62
IPC 1 3.33% 57.80 15.00
REITs 1 3.33% 73.27 11.28
Total 30 100.00%
Based on the average CSR ratings, the sectors with outstanding CSR performance include REITs and
consumer products sectors, scoring an average CSR rating of 73.27 and 69.25 respectively. Plantation
sector, however, has the lowest average CSR rating, i.e. poorer CSR performance compared to other
sectors.
5. Conclusion
This paper has examined the CSR practice of 30 Malaysian public-listed GLCs in year 2016 by using
CSR ratings obtained from CSRHub. The Environment dimension obtained the highest average CSR
rating whilst Governance dimension the lowest. For subcategories, Diversity & Labor Rights obtained
the highest average CSR rating whilst Compensation & Benefits the lowest. Both highest and lowest
rated subcategories belong to Employees dimension. For sectors, REITs has the highest average CSR
rating whilst Plantation the lowest. The results of present study were different from past literature,
possibly due to the facts that past literature applied CSR disclosure score (i.e. self-reporting) to proxy
for CSR, however, the present study adopted CSR rating (i.e. third-party assessment). CSR disclosure
score is obtained through content analysis of company’s annual reports, in contrary, CSR rating from
L. B. Keong et al. / Management Science Letters 8 (2018)
423
CSRHub is derived from multiple sources of information. The findings of present study provide a val-
uable insight to GLCs to revise their CSR practice and to improve on the low-rating areas such as
Product, Transparency & Reporting and Compensation & Benefits subcategories.
This study is subject to several limitations. First, only one year (i.e. year 2016) CSR performance has
been studied. Second, small sample size of 30 GLCs makes the results of statistical tests inaccurate and
insignificant as to study the differences in CSR practice across different industrial sectors. Third, una-
vailability of data on CSRHub makes large sample size study not feasible.
There are some suggestions for future study. First, a longitudinal study can be conducted to study the
trends and patterns of CSR practice in Malaysian GLCs. Second, a comparative study of CSR practice
between GLCs and non-GLCs may provide meaningful insights on their differences. Third, the study
can be replicated by using a larger sample size to study the differences of CSR practice across different
industrial sectors. Fourth, regression tests can be done to examine the relationship between CSR ratings
and other corporate attributes such as firm’s size, firm’s profitability, etc. Fifth, interview or question-
naire survey can be conducted to investigate the underlying reasons and motives of contributing more
in certain CSR dimensions and subcategories.
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Appendix
List of Public-Listed GLCs
Name of GLCs Sector
1. Affin Holdings Bhd Finance
2. Axiata Group Bhd Trad/Serv
3. BIMB Holdings Bhd Finance
4. Boustead Holdings Bhd Trad/Serv
5. Bursa Malaysia Berhad Finance
6. Dutch Lady Milk Industries Bhd Consumer
7. Felda Global Ventures Holdings Bhd Plantation
8. Gamuda Bhd Constructn
9. IHH Healthcare Berha
d
Trad/Serv
10. IJM Corporation Bhd. Constructn
11. KLCC Property Holdings Bhd REITS
12. KPJ Healthcare Berhad Trad/Serv
13. Malakoff Corporation Berhad Trad/Serv
14. Malayan Banking Bhd Finance
15. Malaysia Airports Holdings Bh
d
Trad/Serv
16. Malaysia Building Society Berhad Finance
17. Malaysian Resources Corporation Berhad Properties
18. MISC Berhad Trad/Serv
19. MMC Corporation Berhad Trad/Serv
20. Petronas Dagangan Bhd Trad/Serv
21. Petronas Gas Bhd Ind-Prod
22. Pos Malaysia Berhad Trad/Serv
23. Sime Darby Bhd Trad/Serv
24. S P Setia Bhd Properties
25. Telekom Malaysia Bhd Trad/Serv
26. Tenaga Nasional Bhd Trad/Serv
27. Time Dotcom Bhd IPC
28. UMW Holdings Bhd Consumer
29. UOA Development Bhd Properties
30. Westports Holdings Bhd Trad/Serv
L. B. Keong et al. / Management Science Letters 8 (2018)
425
CSRHub Category and Subcategory Schema
COMMUNITY
Community Subcategories
Community Development and Phi-
lanthropy
Human Rights and Supply Chain Product
The Community Category covers the
company’s commitment and effective-
ness within the local, national and
global community in which it does
business. It reflects a company’s citi-
zenship, charit able giving, and vol un-
teerism. This category covers the com-
pany’s human rights record and treat-
ment of its suppl y chain. It also covers
the environmental and social impacts of
the company’s products and services,
and the development of sustainable
products, processes and technologies.
The Community Development and Phi-
lanthropy subcate gory covers the rela-
tionship between a company and the
communities within which it is embed-
ded. It reflects a company’s community
citizenship through charitable giving,
donations of goods, and volunteerism
of staff time. It also includes protecting
public health (e.g., avoidance of indus-
trial accidents) and managing the social
impacts of its operations on local com-
munities. The subcategory also in-
cludes a company’s land use and build-
ing design impact on the local economy
and ecosystem.
The Human Rights and Supply Chain
subcategory measures a company’s
commitment to respecting fundamental
human rights conventions, its ability to
maintain its license to operate by sup-
porting freedom of association and ex-
cluding child, forced or compulsory la-
bor. This subcategory covers a com-
pany’s transparency in overseas sourc-
ing disclosure and monitoring and a
company’s relationship with and re-
spect for the human rights of indige-
nous peoples near its proposed or cur-
rent operations.
The Product subcategory covers the re-
sponsibility of a company for the de-
velopment, design, and management of
its products and services and their im-
pacts on customers and society at large.
This subcategory reflects a company’s
capacity to reduce environmental costs,
create new market opportunities
through new sustainable technologies
or processes, and produce or market
goods and services that enhance the
health and quality of life for consum-
ers. This subcategory rating covers the
integrity of a company’s products and
sales practices, including their labeling
and marketing, social impacts and end-
of-life disposition. It also relates to
product safety and quality and the com-
pany’s response to problems with
safety and quality.
EMPLOYEES Employees Subcategory
Compensation and Benefits Diversity and Labor Rights Training, Safety and Health
The Employees category includes dis-
closure of policies, programs, and per-
formance in diversity, labor relations
and labor rights, co mpensation, bene-
fits, and employee trai ning, health and
safety. The evaluation focuses on the
quality of policies and programs, com-
pliance with national laws and regula-
tions, and proactive management initia-
tives. The category includes evaluation
of inclusive diversity policies, fair
treatment of all employees, robust di-
versity (EEO-1) programs and training,
disclosure of workforce diversity data,
strong labor codes (addressing the core
ILO standards), comprehensive bene-
fits, demonstrated training and develop-
ment opportunities, employee health
and safety policies, basic and industry-
specific safety training, demonstrated
safety management systems, and a pos-
itive safety performance record.
The Compensation and Benefits sub-
category covers a company’s capacity
to increase its workforce loyalty and
productivity through rewarding, fair,
and equal compensation and financial
benefits. It includes benefits that en-
gage employees and improve worker
development. This subcategory also fo-
cuses on long-term employment growth
and stability by promotion practices,
lay-off practices, and relations with re-
tired employees.
The Diversity and Labor Rights subcat-
egory covers workplace policies and
practices covering fair and non-dis-
criminatory treatment of employees,
and its diversity policies. It covers a
company’s labor-management relations
and participatio n by employees, Na-
tional Labor Relations Board (NLRB)
violations or pat terns of anti-uni on
practice, conformance to internation-
ally recognized worker rights, as de-
fined in the basic conventions of the In-
ternational Labor Organization (ILO).
Fundamental labor rights include free-
dom of association and protection of
the right to organize; right to bargain
collectively; a minimum age for the
employment of ch ildren; a prohi bition
against forced labor; lack of employ-
ment and occupati onal discrimination;
and equal compensation. This subcate-
gory measures a company’s ability to
maintain diversity, provide equal op-
portunities regardless of gender, age,
ethnicity, religion or sexual orientation,
and promote work-life balance.
The Training, Safety and Health sub-
category measures a company’s effec-
tiveness in providing a healthy and safe
workplace. This subcategory includes
accident and safety performance, as
well as job training, safety standards
and training, and employee-manage-
ment safety teams. It includes programs
to support the health, well-being and
productivity of all employees. This
subcategory includes workplace poli-
cies and programs that boost employee
morale, workplace productivity, com-
pany policies and practices to engage
employees, and worker development.
ENVIRONMENT Environment Subcategory
Energy and Climate Change Environmental Policy and Reporting Resource Management
The Environment category data covers
a company’s interactions with the envi-
ronment at large, including use of natu-
ral resources, and a company’s impact
on the Earth’s ecosystems. The cate-
gory evaluates corporate environmental
performance, compliance with environ-
mental regulati ons, mitigation of envi-
ronmental footprint, leadership in ad-
dressing climate change through appro-
priate policies and strategies, energy-
efficient operations, and the develop-
ment of renewable energy and other al-
ternative environmental technologies,
disclosure of sources of environmental
risk and liability and actions to mini-
mize exposure to future risk, imple-
mentation of natural resource conserva-
tion and efficiency programs, pollution
prevention programs, demonstration of
a strategy toward sustainable develop-
ment, integration of environmental sus-
tainability and responsiveness with
management and t he board, and pro-
grams to measure and engage stake-
holders for environmental improve-
ment.
The Energy and Climate Change sub-
category measures a company’s effec-
tiveness in addressing climate change
through appropria te policies and strate-
gies, energy-efficient operations, and
the development of renewable energy
and other alternative environmental
technologies. The subcategory includes
energy use, emissions to air of CO2
and other Greenhouse Gas Emissions
(GHG).
The Environmental Policy and Report-
ing subcategory includes a company’s
policies and intention to reduce the en-
vironmental impact of a company and
its value stream to levels that are
healthy for the company and for the en-
vironment, now and in the future. The
data includes the company’s environ-
mental reporting performance, adher-
ence to environmental reporting stand-
ards such as the Global Reporting Initi-
ative, and compliance with investor,
regulatory and stakeholders’ requests
for transparency. Compliance data con-
sists of breaches of regulatory limits
and accidental releases.
The Resource Management subcate-
gory covers how efficiently resources
are used in manufacturing and deliver-
ing products and services, including
those of a company’s suppliers. It in-
cludes a company’s capacity to reduce
the use of materials, energy or water,
and to find more efficient solutions by
improving its supply chain manage-
ment. This subcategory includes envi-
ronmental performance relative to pro-
duction size and is monitored by the
production-related Eco Intensity Ratios
(EIRs) for water and energy defined as
resource consumption per produced or
released unit. Resource materials in-
clude raw materials and packaging ma-
terials for production and related pro-
cesses and packaging of products. Re-
source Management data also include
waste and recycling performance. Re-
cycling data is related to the proportion
of waste recycled of the total waste.
Data includes how the company man-
ages operations to benefit the local
airshed and watershed, and how the
company impacts land use and local
ecological stability. The water resource
data includes consumption of drinking
water, industrial water and steam.
426
GOVERNANCE Governance Subcategory
Board Leadershi p Ethics Transparency and Reporting
The Governance category covers dis-
closure of policies and procedures,
board independence and diversity, ex-
ecutive compensation, attention to
stakeholder concerns, and evaluation of
a company’s culture of ethical leader-
ship and compliance. Corporate gov-
ernance refers to leadership structure
and the values that determine corporate
direction, ethics and performance. This
category rates factors such as: are cor-
porate policies and practices aligned
with sustainability goals; is the man-
agement of the corporation transparent
to stakeholders; are employees appro-
priately engaged in the management of
the company; are sustainability princi-
ples integrated from the top down into
the day-to-day operations of the com-
pany. Governance focuses on how
manageme nt is commi tted to s ustaina-
bility and corporate responsibility at all
levels.
The Board subcategory covers a com-
pany’s effectiveness in following best
practices in corporate governance prin-
ciples related t o board membershi p, in-
dependent decision making through ex-
perienced, diverse and independent
board members, effectiveness toward
following best practices related to
board activities and functions, and
board committee structure and compo-
sition. It includes how the company
provides competitive and proportionate
management compen sation and its abil -
ity to incent executives and board
members to achieve both financial and
extra-financial targets.
The Leadership Ethics subcategory
measures how a company manages its
relationships with its various stakehold-
ers, including investors, customers,
communities, and regulators. This sub-
category measures a company’s effec-
tiveness in treating its shareholders eq-
uitably. Leadership ethics includes the
company’s culture of ethical decision
making. It measures a company’s com-
mitment and effectiveness toward the
vision of integrating social and envi-
ronmental aspects into the overall core
strategy and whether sustainability
principles are integrated from the top
down into the day-to-day operations of
the company.
The Transparency and Reporting sub-
category rates factors including are cor-
porate policies and practices aligned
with sustainability goals, is the man-
agement of the corporation transparent
to stakeholders, are employees appro-
priately engaged in the management of
the company, and do sustainability re-
ports comply with st andards such as the
Global Reporting Initiative, AccountA-
bility (AA1000) and other standards,
and are these repor ts made publicly
available. This subcategory includes
whether the company provides a list of
its major stakeholders and how it en-
gages with them. It also covers whether
the company is a signatory of Global
Compact and other leading global enti-
ties. It evaluates the assurance (3rd
party audit) of the accuracy, complete-
ness, and reliability of its Sustainability
or Corporate Social Responsibility re-
ports.
Source:https://www.csrhub.com/content/csrhub-data-schema/
© 2018 by the authors; licensee Growing Science, Canada. This is an open access ar-
ticle distributed under the terms and conditions of the Creative Commons Attribution
(CC-BY) license (http://creativecommons.org/licenses/by/4.0/).
