Search

This study analyzes the relationship between the pessimistic tone in earnings announcements and CSR disclosures interacted by CEO busyness. This study used 191 observations from 74 firms listed on the Indonesia Stock Exchange and the Global Reporting Initiative (GRI) database from 2016–2019. Grounded in signaling theory, we hypothesize that a pessimistic tone in earning announcements will increase CSR disclosure. We also hypothesize that busy CEOs strengthen this relationship. We use the ordinary least squares to analyze and answer our hypotheses. This study showed that the use of a pessimistic tone in the income statement in the discussion report and management analysis (MD&A) is related positively and significantly to CSR disclosure. This study also found that busy CEOs strengthen those relationships. Our implication is that CSR disclosure in our sample is only measured based on the information presented in the sustainability report. To the best of the authors’ knowledge, this study is the first to investigate the relationship between the pessimistic tone in earning announcements and CSR disclosures interacted by CEO busyness. In addition, this study provides insight into current performance disclosure practices in MD&A reports and CSR reports that managers can use to safeguard the firm’s reputation.

This study examines the relationship between financial distress and environmental, social, and governance (ESG) disclosure. We hypothesize that financially distressed firms are tempted to enhance ESG disclosure as it provides higher performance in terms of financial and market perspectives. ESG disclosure needs substantial resources, which financially distressed firms may not be able to provide. In Indonesian settings, we find that financially distressed firms have lower ESG disclosure quality than non-distressed firms. Our results are robust due to lagged variable, Heckman’s two stages, and coarsened exact matching regression showing consistent results. Furthermore, our results are consistent with three years of rolling windows of financial distress and all sections of ESG reporting, except the general information section. This study extends the scope of prior studies by focusing on firms’ eagerness to provide higher quality ESG disclosure, particularly distressed firms.

In this paper, the authors examine the impact of corporate governance mechanisms on corporate social responsibility (CSR) disclosure in European and Anglo-Saxon contexts. The study is based on 324 Anglo-Saxon listed corporations and 310 European listed corporations for 11 years from 2006 to 2016 (6813 year-observations). The regression analysis shows that board gender and board age affect CSR disclosure. This study also finds that CEO duality negatively affects CSR disclosure in both contexts. Finally, the study found that the existence of a CSR committee and CSR experts positively affect CSR disclosure in both contexts.

The recent global financial crisis (GFC) has put under scrutiny the sound remuneration policy and consequently the incentives design that influences risk-taking by managers in the banking industry to be a politically charged variable. In particular, this paper analyzes the new EU remuneration regulation of bank executive compensation and the role of corporate social responsibility (CSR) on this. Though all the EU efforts put into remuneration practices suggest commitment in aligning risk, performance, and compensation and aim at easing bank managers’ risk appetite for variable payments, the new regulation might drive unintended consequences, creating adverse selection problems in EU banks and hidden compensation habits that lower transparency, thus threatening financial system’s sustainability. Focusing on European Banking Authority (EBA) reports spanning from 2010 to 2017, the data reveals increasing values on the fixed component, less involvement in bank discipline by economic agents, and a potential for accounting-based incentives compensation that might reinforce attitudes towards building countercyclical buffers and smoothing earnings. As well, the new regulation might reduce the number of best-performing bank managers in the Eurozone, since “bad risks” are accepted to the detriment of “good risks,” which might stimulate their migration. In contrast, CSR investment is supposed to offset such practices and incentives that harm EU financial stability. As a result, policymakers, banks, and regulators should promote the transparency of CSR disclosure.

Smaller companies&rsquo, understanding of and attitude toward corporate social responsibility (CSR), both in terms of actions and disclosure, is distinct from that of other organizations, including large public interest entities (PIEs) that dominate the existing literature in the field. In this study, we examine the interdependencies between non-large PIEs&rsquo, CSR practices and disclosures with the use of the organizational hypocrisy concept as a theoretical lens. Our sample consists of 111 companies operating in Poland and pursuing 646 CSR-related practices in 2017. We perform content analysis of their websites using the disclosure index to assess the extent of their CSR disclosures. The total number of observations equals 1227. Both practices and disclosures are analyzed according to ISO 26000 standards. The relationship between the sample companies&rsquo, CSR talk and actions is analyzed by means of the Pearson coefficient. Our findings suggest that CSR practices and disclosures of non-large PIEs are loosely coupled. For the whole sample and for the non-SMEs (small and medium sized entities) subsample, the strongest association between the two was observed as regards the organizational governance area. As far as the SMEs are concerned, the statistically significant association between their CSR reporting and actions was identified for the environmental area. Our study contributes to the CSR literature, as it provides new insights into the relation between voluntary CSR talk and actions of non-large PIEs operating in a relatively unexplored setting.

Since the empirical evidence on the relationship between corporate social responsibility disclosure (CSRD) and firm productivity is scarce in the context of the banking industry, the study examines whether CSRD leads banks in Bangladesh to higher productivity. Using annual report data of all 30 banks listed on the Dhaka Stock Exchange in Bangladesh from 2011 to 2018, the study applied a data envelopment analysis (DEA) to determine the productivity of the sample banks, and then ordinary least squares (OLS) analysis to examine the impact of CSR on the banks’ productivity. Furthermore, the study utilized two-stage least squares (2SLS) and a generalized method of moments (GMM) to check the robustness of the findings amid the detection of endogeneity issues. The study also used several alternative variables to check and verify the reliability of the study. The findings indicate that the greater a bank’s contribution to CSR, the higher its productivity. However, banks with more debt to assets are less productive. Additionally, the study observed that the impact of CSRD on bank productivity is higher in GRI banks compared to non-GRI banks, non-politically connected banks as opposed to politically connected banks, and conventional banks compared to Islamic banks. The study provides valuable insight into how CSR activities can promote bank productivity, thus motivating the banks to execute a well-thought-out action plan to ensure more CSR contribution. This study is the first ever bank-level evidence that provides insight into how the patterns of CSR activity of publicly traded banks impact their productivity.

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.

This study intends to examine corporate social responsibility (CSR) in Pakistan&rsquo, s banking sector, CSR disclosure practices and their impact on financial performance. For the study, relevant data was collected from the banks&rsquo, annual reports, financial websites, the State Bank of Pakistan (SBP) and the Pakistan Stock Exchange (PSE) from 2008 to 2018. The methods utilized in this research study were content analysis and panel data techniques. The results indicate an increase in overall CSR disclosure by all banks in the sample and the findings suggest the involvement of commercial banks in CSR activities, and its proper disclosure has helped to improve their accounting-based financial performance proxied by the return on equity (ROE) and return on assets (ROA). The research findings contribute to a better understanding of the CSR practices in the financial sector of an emerging country, which makes a dynamic effort to develop its financial culture and can encourage rapprochement with Pakistan&rsquo, s financial sector.

We propose to investigate the relationship between corporate social responsibility disclosure and institutional/environmental factors among a sample of European listed companies. We find that, by using several traditional explicative variables, institutional factors affect the level of CSR disclosure, in a context where the EU Commission has been paying growing attention to social and environmental accountability of listed companies (see the EU Dir. 95/2014). Our findings are further supported by multivariate regression, where ESG score (measure of CSR disclosure) is regressed on nine variables which represent the expression of institutional factors. By looking at the institutional determinants of CSR disclosure, we are seeking to pose a challenge for future research agenda, in order to understand whether CSR does actually reflect an effective commitment of firms to accounting practices and rules, as a form of social behavior, or whether it is just a tool to manage stakeholders&rsquo, perception and to comply with regulation.

On 15 December 2016, new non-financial reporting requirements were implemented in the Polish Accounting Act (PAA) which would be enforced from 1 January 2017. This act resulted from the transposition of Directive 2014/95/EU. New requirements oblige certain groups of entities to disclose non-financial information on environmental, social and employee-related matters, respect for human rights, anti-corruption and bribery matters. The purpose of this paper is two-fold. Firstly, this study analyses the new non-financial reporting requirements implemented in PAA, which were created from the transposition of the Directive. Secondly, this study investigates the current extent and quality of corporate social responsibility (CSR) reporting in companies listed on the Warsaw Stock Exchange (WSE) and their compliance with the new requirements. The sample comprises 150 selected listed companies on the WSE. The data were collected from annual reports, separate CSR reports, and companies’ websites. Content analysis and a rating scale were used to measure the level of CSR disclosures. The results show that companies prefer annual reports to communicate voluntary CSR disclosures. In the majority of cases, CSR disclosure of companies were not compliant with the new requirements. Companies placed little emphasis on reporting about human rights and anti-corruption. This suggests that the new reporting obligation should increase the extent and quality of non-financial disclosure among Polish listed companies.

CSR reporting is a relevant part of a firm’s dialogue with stakeholders, therefore it is of interest to study whether this form of communication is an effective tool for gaining customers’ support. This paper addresses this issue by comparing the effect of CSR disclosure on family and non-family firms’ revenues. In doing so, we analyze a sample of Italian non-financial listed firms and we control for the effect of visibility to stakeholders, governance characteristics, risk, and several accounting variables. We find that CSR reporting has a significant effect on revenues when a company is characterized by consumer proximity, in terms of product or services visibility for consumers, but that the effect is positive for family firms and negative for non-family companies.