Abstract
The aim of this paper is to analyze whether a number of firm and industry characteristics, as well as media exposure, are potential determinants of corporate social responsibility (CSR) disclosure practices by Spanish listed firms. Empirical studies have shown that CSR disclosure activism varies across companies, industries, and time (Gray et al., Accounting, Auditing & Accountability Journal 8(2), 47–77, 1995; Journal of Business Finance & Accounting 28(3/4), 327–356, 2001; Hackston and Milne, Accounting, Auditing & Accountability Journal 9(1), 77–108, 1996; Cormier and Magnan, Journal of International Financial Management and Accounting 1(2), 171–195, 2003; Cormier et al., European Accounting Review 14(1), 3–39, 2005), which is usually justified by reference to several theoretical constructs, such as the legitimacy, stakeholder, and agency theories. Our findings evidence that firms with higher CSR ratings present a statistically significant larger size and a higher media exposure, and belong to more environmentally sensitive industries, as compared to firms with lower CSR ratings. However, neither profitability nor leverage seem to explain differences in CSR disclosure practices between Spanish listed firms. The most influential variable for explaining firms’ variation in CSR ratings is media exposure, followed by size and industry. Therefore, it seems that the legitimacy theory, as captured by those variables related to public or social visibility, is the most relevant theory for explaining CSR disclosure practices of Spanish listed firms.
Similar content being viewed by others
References
Adams, C.A., Hill, W.Y., & Roberts, C.B. (1998). Corporate Social Reporting Practices in Western Europe: Legitimating Corporate Behaviour. The British Accounting Review, 30(1), 1–21. doi:10.1006/bare.1997.0060
Adrem, A. H.: 1999, Essays on Disclosure Practices in Sweden – Causes and Effects (Lund University Press)
Archel, P. (2003). La divulgación de la información social y medioambiental de la gran empresa española en el período 1994–1998: situación actual y perspectivas. Revista Española de Financiación y Contabilidad, 117, 571–601.
Archel, P., & Lizarraga, F. (2001). Algunos determinantes de la información medioambiental divulgada por las empresas españolas cotizadas. Revista de Contabilidad, 4(7), 129–153.
Bansal, P., & Clelland, I. (2004). Talking trash: legitimacy, impression management and unsystematic risk in the context of the natural environment. Academy of Management Journal, 47(1), 93–103.
Bansal, P., & Roth, K. (2000). Why companies go green: a model of ecological responsiveness. Academy of Management Journal, 43(4), 717–736. doi:10.2307/1556363
Belkaoui, A., & Karpik, P.G. (1989). Determinants of the Corporate Decision to Disclose Social Information. Accounting, Auditing & Accountability Journal, 2(1), 36–51. doi:10.1108/09513578910132240
Bewley, K., & Li, Y. (2000). Disclosure of Environmental Information by Canadian Manufacturing Companies: A Voluntary Disclosure Perspective. Advances in Environmental Accounting and Management, 1, 201–226. doi:10.1016/S1479-3598(00)01011-6
Blacconiere, W.G., & Northcut, W.D. (1997). Environmental information and market reactions to environmental legislation. Journal of Accounting, Auditing & Finance, 12(Spring), 149–178.
Blacconiere, W.G., & Patten, D.M. (1994). Environmental disclosures, regulatory costs and changes in firm value. Journal of Accounting and Economics, 18(3), 357–377. doi:10.1016/0165-4101(94)90026-4
Bowen, F. (2000). Environmental visibility: a trigger of green organizational response? Business Strategy and the Environment, 9(2), 92-107. doi:10.1002/(SICI)1099-0836(200003/04)9:2<92::AID-BSE230>3.0.CO;2-X
Brammer, S., & Pavelin, S. (2008). Factors Influencing the Quality of Corporate Environmental Disclosure. Business Strategy and the Environment, 17, 120–136. doi:10.1002/bse.506
Brown, N., & Deegan, C. (1998). The public disclosure of environmental performance information –a dual test of media agenda setting theory and legitimacy theory. Accounting and Business Review, 29(1), 21–41.
Campbell, D.J. (2000). Legitimacy Theory or Managerial Reality Construction? Corporate Social Disclosure in Marks and Spencer, Plc Corporate Reports 1969–1997. Accounting Forum, 24(1), 80–100. doi:10.1111/1467-6303.00030
Carmona, S. and F. Carrasco: 1988, ‹Información de contenido social y estados contables: Una aproximación empírica y algunas consideraciones teóricas’, Actualidad Financiera noviembre, 2175–2192
CEC: 2001, Green Paper: Promoting a European Framework for Corporate Social Responsibility (COM), 366 final
Clarke, J., & Gibson-Sweet, M. (1999). ‹The Use of Corporate Social Disclosures in the Management of Reputation and Legitimacy: A Cross Sectoral Analysis of UK Top 100 Companies’, Business Ethics. European Review (Chichester, England), 8(1), 5–13.
Cooke, T.E. (1989). Voluntary Corporate Disclosure by Swedish Companies. Journal of International Financial Management and Accounting, 1(2), 171–195. doi:10.1111/j.1467-646X.1989.tb00009.x
Cormier, D., & Magnan, M. (2003). Environmental Reporting Management: A Continental European Perspective. Journal of Accounting and Public Policy, 22(1), 43–62. doi:10.1016/S0278-4254(02)00085-6
Cormier, D., Gordon, I.M., & Magnan, M. (2004). ‹Corporate Environmental Disclosure: Contrasting Management’s Perceptions with Reality’. Journal of Business Ethics, 49(2), 143–165. doi:10.1023/B:BUSI.0000015844.86206.b9
Cormier, D., Magnan, M., & Van Velthoven, B. (2005). Environmental Disclosure Quality in Large German Companies: Economic Incentives, Public Pressures or Institutional Conditions? European Accounting Review, 14(1), 3–39. doi:10.1080/0963818042000339617
Cowen, S.S., Ferreri, L.B., & Parker, L.D. (1987). The impact of corporate characteristics on social responsibility disclosure: a typology and frequency-based analysis. Accounting, Organizations and Society, 12(2), 111–122. doi:10.1016/0361-3682(87)90001-8
Cullen, L., & Christopher, T. (2002). Governance Disclosures and Firm Characteristics of Listed Australian Mining Companies. International Journal of Business Studies, 10(1), 37–58.
Deegan, C. (2002). The Legitimising Effect of Social and Environmental Disclosures –A Theoretical Foundation. Accounting, Auditing & Accountability Journal, 15(3), 282–311. doi:10.1108/09513570210435852
Deegan, C., & Gordon, B. (1996). A study of the environmental disclosure practices of Australian corporations. Accounting and Business Review, 26(3), 187–199.
Deegan, C., & Rankin, M. (1996). ‹Do Australian Companies Report Environmental News Objectively? An Analysis of Environmental Disclosures by Firms Prosecuted Successfully by the Environmental Protection Authority’. Accounting, Auditing & Accountability Journal, 9(2), 50–67. doi:10.1108/09513579610116358
DiMaggio, P.J., & Powell, W.W. (1983). The iron cage revisited: institutional isomorphism and collective rationality in organizational fields. American Sociological Review, 48, 147–160. doi:10.2307/2095101
Dowling, J., & Pfeffer, J. (1975). ‹Organisational legitimacy: Social values and organisational behaviour’, Pacific Sociological Review, 18(1), 122–136.
García-Ayuso, M., & Larrinaga, C. (2003). Environmental disclosure in Spain:corporate characteristics and media exposure. Revista Española de Financiación y Contabilidad, 115, 184–214.
Giner, B. (1997). The influence of company characteristics and accounting regulation on information disclosed by Spanish firms. European Accounting Review, 6(1), 45–68. doi:10.1080/096381897336863
Godfrey, P.C., & Hatch, N.W. (2007). Researching Corporate Social Responsibility: An Agenda for the 21st Century. Journal of Business Ethics, 70(1), 87–98. doi:10.1007/s10551-006-9080-y
Graham, A., Maher, J., & Northcut, W.D. (2000). Environmental liability information and bond ratings. Journal of Accounting, Auditing & Finance, 15(2), 93–116.
Gray, R., Kouhy, R., & Lavers, S. (1995). Corporate Social and Environmental Reporting: A Review of the Literature and A Longitudinal Study of UK Disclosure. Accounting, Auditing & Accountability Journal, 8(2), 47–77. doi:10.1108/09513579510146996
Gray, R.H., Owen, D., & Adams, C.(1996). Accounting and Accountability. Hemel Hempstead: Prentice Hall.
Gray, R., Javad, M., Power, D.M., & Sinclair, C.D. (2001). Social and environmental disclosure and corporate characteristics: a research note and extension. Journal of Business Finance & Accounting, 28(3/4), 327–356. doi:10.1111/1468-5957.00376
Guthrie, J., & Parker, L. (1989). Corporate social reporting: a rebuttal of legitimacy theory. Accounting and Business Review, 19(3), 343–352.
Hackston, D., & Milne, M.J. (1996). Some Determinants of Social and Environmental Disclosures in New Zealand Companies. Accounting, Auditing & Accountability Journal, 9(1), 77–108. doi:10.1108/09513579610109987
Hamid, F.Z.A. (2004). ‹Corporate social disclosure by banks and finance companies: Malaysian evidence’. Corporate Ownership & Control, 1(4), 118–130.
Haniffa, R.M., & Cooke, T.E. (2005). ‹The impact of culture and governance on corporate social reporting’. Journal of Accounting and Public Policy, 24(5), 391–430. doi:10.1016/j.jaccpubpol.2005.06.001
Henriques, I. and P. Sadorsky: 1996, ‹The Role of Information in Coordinating Environmental Issues’, in Academy of Management Best Paper Proceedings (Cincinnati, OH), pp. 1–30.
Hoffman, A.J. (1999). Institutional evolution and change: environmentalism and the U.S. chemical industry. Management Journal, 42(4), 351–371.
Hooghiemstra, R. (2000). Corporate communication and impression management: New perspectives why companies engage in corporate social reporting. Journal of Business Ethics, 27(1/2), 55–68. doi:10.1023/A:1006400707757
Hossain, M., Tan, L.M., & Adams, M. (1994). Voluntary disclosure in an emerging capital market: Some empirical evidence from companies listed on Kuala Lumpur stock exchange. The International Journal of Accounting, 29(4), 334–351.
Hossain, M., Perera, M.H.B., & Rahman, A.R. (1995). ‹Voluntary Disclosure in the Annual Reports of New Zealand Companies’. Journal of International Financial Management and Accounting, 6(1), 69–87. doi:10.1111/j.1467-646X.1995.tb00050.x
Hutchings, G. and D. W. Taylor: 2000, ‹The Intra-Industry Capital Market and Corporate Reporting Effects of the BHP Ok Tedi Environmental Event’, Asian Review of Accounting 8(Special Issue), 33–54
Ismail, K.N., & Chandler, R. (2005). Disclosure in the quarterly reports of Malaysian companies. Financial Reporting. Regulation and Governance, 4(1), 1–26.
Jenkins, H.M., & Yakovleva, N. (2006). Corporate social responsibility in the mining industry: exploring trends in social and environmental disclosure. Journal of Cleaner Production, 14(3–4), 271–284. doi:10.1016/j.jclepro.2004.10.004
Jennings, P.D., & Zandbergen, P.A. (1995). Ecologically sustainable organizations: an institutional approach. Academy of Management Review, 20(4), 1015–1052. doi:10.2307/258964
Jensen, M.C., & Meckling, W.H. (1976). Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3, 305–360. doi:10.1016/0304-405X(76)90026-X
Knox, S., Maklan, S., & French, P. (2006). Corporate Social Responsibility: Exploring Stakeholder Relationships and Programme Reporting across Leading FTSE Companies. Journal of Business Ethics, 61(1), 7–28. doi:10.1007/s10551-005-0303-4
Kolk, A. (2003). ‹Trends in sustainability reporting by the Fortune Global 250’. Business Strategy and the Environment, 12(5), 279–291. doi:10.1002/bse.370
Line, M., Hawley, H., & Krut, R. (2002). Development in global environmental and Social reporting. Corporate Environmental Strategy, 9(1), 69–78. doi:10.1016/S1066-7938(01)00159-2
McGuire, J.B., Sundgren, A., & Schneeweis, T. (1988). ‹Corporate Social Responsibility and Firm Financial Performance’. Academy of Management Journal, 31(4), 854–872. doi:10.2307/256342
Meyer, J.W., & Rowan, B. (1977). Institutionalized organizations: formal structure as myth and ceremony. American Journal of Sociology, 83, 340–363. doi:10.1086/226550
Milne, M.J. (2002). Positive Accounting Theory, Political Costs and Social Disclosure Analyses: A Critical Look. Critical Perspectives on Accounting, 13(3), 369–395. doi:10.1006/cpac.2001.0509
Moneva, J. M. and F. Llena: 1996, ‹Análisis de la información sobre responsabilidad social en las empresas industriales que cotizan en Bolsa’, Revista Española de Financiación y Contabilidad XXV(87), 361–401
Moneva, J.M., & Llena, F. (2000). Environmental disclosures in the annual reports of large companies in Spain. European Accounting Review, 9(1), 7–29. doi:10.1080/096381800407923
Morris, S.: 1997, ‹Environmental Pollution and Competitive Advantage: An Exploratory Study of U.S. Industrial-Goods Manufacturers’, in Academy of Management Conference Proceedings, 1997 (Academy of Management, New York)
Nasi, J., Nasi, S., Phillips, N., & Zyglidopoulos, S. (1997). ‹The Evolution of Corporate Social Responsiveness’. Business & Society, 36(3), 296–321. doi:10.1177/000765039703600305
Ness, K., & Mirza, A. (1991). Corporate Social Disclosure: A Note on the Test of Agency Theory. The British Accounting Review, 23, 211–217. doi:10.1016/0890-8389(91)90081-C
Neu, D., Warsame, H., & Pedwell, K. (1998). Managing Public Impressions: Environmental Disclosures in Annual Reports. Accounting, Organizations and Society, 23(3), 265–282. doi:10.1016/S0361-3682(97)00008-1
Ng, E.J., & Koh, H.C. (1994). An Agency Theory and Profit Analytic Approach to Corporate Non-Mandatory Disclosure Compliance. Asia-Pacific Journal of Accounting, 1(1), 29–44.
Oliver, C. (1991). Strategic responses to institutional processes. Academy of Management Review, 16(1), 145–179. doi:10.2307/258610
Patten, D.M. (1991). Exposure, Legitimacy, and Social Disclosure. Journal of Accounting and Public Policy, 10(4), 297–308. doi:10.1016/0278-4254(91)90003-3
Patten, D.M. (2002a). Give or Take on the Internet: An Examination of the Disclosure Practices of Insurance Firm Web Innovators. Journal of Business Ethics, 36(3), 247–259. doi:10.1023/A:1014009229437
Patten, D.M. (2002b). Media Exposure, Public Policy Pressure, and Environmental Disclosure: An Examination of the Impact of Tri Data Availability. Accounting Forum, 26(2), 152–171. doi:10.1111/1467-6303.t01-1-00007
Perrow, C. 1970, Organizational analysis: A sociological view, Wadsworth, Belmont, CA.
Pirsch, J., Gupta, S., & Landreth-Grau, S. (2007). A framework for understanding corporate social responsibility programs as a continuum: An exploratory study. Journal of Business Ethics, 70(2), 125–140. doi:10.1007/s10551-006-9100-y
Prencipe, A. (2004). Proprietary Costs and Determinants of Voluntary Segment Disclosure: Evidence from Italian Listed Companies. European Accounting Review, 13(2), 319-340. doi:10.1080/0963818042000204742
Purushothaman, M., Tower, G., Hancock, R., & Taplin, R. (2000). Determinants of Corporate Social Reporting Practices of Listed Singapore Companies. Pacific Accounting Review, 12(2), 101-133.
Richardson, A.J., & Welker, M. (2001). Social disclosure, financial disclosure and the cost of capital. Accounting, Organizations and Society, 26(7/8), 597–616. doi:10.1016/S0361-3682(01)00025-3
Robb, S.W.G., Single, L.E., & Zarzeski, M.T. (2001). Nonfi nancial disclosures across Anglo-American countries. Journal of International Accounting, 10(1), 71–83.
Roberts, R.W. (1992). ‹Determinants of corporate social responsibility disclosure: an application of stakeholder theory’. Accounting, Organizations and Society, 17(6), 595–612. doi:10.1016/0361-3682(92)90015-K
Scott, W.R. (1987). The adolescence of institutional theory. Administrative Science Quarterly, 32(4), 493–511. doi:10.2307/2392880
Simon FL. 1992. Marketing green products in the triad. Columbia Journal of World Business 27(3,4): 268–285
Singhvi, S. and H. Desai 1971. An Empirical Analysis of the Quality of Corporate Financial Disclosure.’’ Accounting Review, January 46(1): 129–138.
Ullmann, A.A. (1985). ‹Data in Search of a Theory: A Critical Examination of the Relationships Among Social Performance, Social Disclosure, and Economic Performance of U.S. Firms’. Academy of Management Review, 10(3), 540–557. doi:10.2307/258135
Watts, R. L. and J. L. Zimmerman: 1986, Positive Accounting Theory (Prentice-Hall, Englewood Cliffs, NJ)
Woodward, D.G., Edwards, P., & Birkin, F. (1996). ‹Organizational Legitimacy and Stakeholder Information Provision’. British Journal of Management, 7, 329–347. doi:10.1111/j.1467-8551.1996.tb00123.x
Woodward, D., Edwards, P., & Birkin, F. (2001). Some evidence on executives’ views of corporate social responsibility. The British Accounting Review, 33(3), 357–397. doi:10.1006/bare.2001.0165
Acknowledgment
This work is part of the research project ECO2008-06238-C02-01/ECON funded by the Spanish Ministry of Education and Science and ERDF.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Reverte, C. Determinants of Corporate Social Responsibility Disclosure Ratings by Spanish Listed Firms. J Bus Ethics 88, 351–366 (2009). https://doi.org/10.1007/s10551-008-9968-9
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10551-008-9968-9