The Determinants of Corporate Social Responsibility Disclosure: Empirical Evidence from Indonesia Listed Firms
Abstract
The study was motivated by previous research findings that indicate the variations of corporate social responsibilities disclosure among countries. The purpose of the study is to examine the determinants that influence corporate social responsibilities disclosure. The determinants namely the firm size, firm age, earning per share, stock price, and industry type, were examined. The sample of the study is listed firms in Indonesia Stock Exchange that issued sustainability reporting. Content analysis of sustainability reporting using the global reporting initiative standard was conducted to measure corporate social responsibilities disclosure. The determinants were examined using multiple regression analysis with a confidence interval level of 95%. The results indicated that the firm size, earning per share and stock price significantly influence the corporate social responsibilities disclosure. Empirical findings of the study contribute in terms of giving an understanding of practice corporate social responsibilities disclosure in a developing country, especially in the Southeast Asia region. Furthermore, the findings provide valuable information for conducting cross-countries' comparative studies.
Keywords
Full Text:
PDFReferences
Ahmad, N. N. N., & Sulaiman, M. (2004). Environment disclosure in Malaysia annual reports: A legitimacy theory perspective. International Journal of Commerce and Management, 14(1), 44–58. https://doi.org/10.1108/10569210480000173
Ali Al-Gamrh, B., & Ahmed AL-Dhamari, R. (2016). Firm Characteristics and Corporate Social Responsibility Disclosure. International Business Management, 10(18), 4283–4291. Retrieved from http://docsdrive.com/pdfs/medwelljournals/ibm/2016/4283-4291.pdf
Ali, W., & Rizwan, M. (2013). Factors Influencing Corporate Social and Environmental Disclosure (CSED) Practices in The Developing Countries: An Institutional Theoretical Perspective. International Journal of Asian Social Science, 3(3), 590–609. Retrieved from http://www.aessweb.com/pdf-files/590-609.pdf
Alsaeed, K. (2006). The association between firm-specific characteristics and disclosure: The case of Saudi Arabia. Managerial Auditing Journal, 21(5), 476–496. https://doi.org/10.1108/02686900610667256
Bagh, T., Khan, M. A., Azad, T., & Atif Khan, M. (2017). The Corporate Social Responsibility and Firms’ Financial Performance: Evidence from Financial Sector of Pakistan. International Journal of Economics and Financial Issues, 7(2), 301–308. Retrieved from http:www.econjournals.com
Bani-Khalid, T., Kouhy, R., & Hassan, A. (2017). The Impact of Corporate Characteristics on Social and Environmental Disclosure (CSED): The Case of Jordan. Journal of Accounting and Auditing: Research & Practice, 2017. https://doi.org/10.5171/2017.369352
Belal, A. R., & Momin, M. (2009). Corporate Social Reporting (CSR) in emerging economies: a review and future direction. Research in Accounting in Emerging Economies, 9, 119–143. https://doi.org/10.1108/S1479-3563(2009)0000009007
Chapple, W., & Moon, J. (2005). Corporate social responsibility (CSR) in Asia a seven-country study of CSR Web site reporting. Business and Society, 44(4), 415–441. https://doi.org/10.1177/0007650305281658
Citraningrum, D. A., Handayani, S. R., & Nuzula, N. F. (2014). Pengaruh Corporate Social Responsibility (CSR) Terhadap Financial Performance Dan Firm Value (Studi pada Perusahaan-Perusahaan yang Terdaftar Pada Indeks SRI KEHATI Periode 2010-2012). Jurnal Administrasi Bisnis, 14(1), 1–10.
Dasgupta, S., Laplante, B., & Mamingi, N. (1998). Capital market responses to environmental performance in developing countries. In Policy Research Working Paper (No. 1909). https://doi.org/10.1016/j.jdeveco.2009.06.005
Deegan, C. (2002). Introduction: The legitimising effect of social and environmental disclosures – a theoretical foundation. Accounting, Auditing & Accountability Journal, 15(3), 282–311. https://doi.org/10.1108/09513570210435852
Dias, A., Rodrigues, L. L., Craig, R., & Neves, M. E. (2019). Corporate social responsibility disclosure in small and medium-sized entities and large companies. Social Responsibility Journal, 15(2), 137–154. https://doi.org/10.1108/SRJ-05-2017-0090
Djajadikerta, H. G., & Trireksani, T. (2012). Corporate social and environmental disclosure by Indonesian listed companies on their corporate web sites. Journal of Applied Accounting Research, 13(1), 21–36. https://doi.org/10.1108/09675421211231899
Dyduch, J., & Krasodomska, J. (2017). Determinants of Corporate Social Responsibility Disclosure: An Empirical Study of Polish Listed Companies. Sustainability, 9, 1–24. https://doi.org/10.3390/su9111934
Fauzan, K., & Kuswanto, D. A. (2018). The Effect of Capital Structure, GCG, CSR, Firm’s Size on Market Value through Earnings Per Share in Banking Sector. Journal of Global Economics, 06(02). https://doi.org/10.4172/2375-4389.1000288
Fauziah, W., & Adamu, M. (2016). The relationship between corporate social responsibility and financial performance: Evidence from Malaysia. International Business Management, 10(4), 345–351.
Fiori, G., Di Donato, F., & Izzo, M. F. (2015). Corporate social responsibility and stock prices: A study on the italian market. Corporate Ownership and Control, 12(2 CONT5), 600–609.
Flammer, C. (2013). Corporate Social Responsibility and Shareholder Value: The Environmental Consciousness of Investors. Academy OfManagement Journal, 56(3), 758–781. https://doi.org/10.2139/ssrn.1888742
Gantyowati, E., & Agustine, K. F. (2017). Firm’s Characteristics and CSR Disclosure, Indonesia and Malaysia Cases. Review of Integrative Business and Economics ResearchOnlineCDROM, 6(3), 131–145.
Gunawan, J., Djajadikerta, H., & Smith, M. (2009). An Examination of Corporate Social Disclosures in The Annual Reports of Indonesian Listed Companies. Asia Pacific Centre for Environmental Accountability Journal, 15(1), 13–36.
Herbohn, K., Walker, J., & Loo, H. Y. M. (2014). Corporate Social Responsibility: The Link Between Sustainability Disclosure and Sustainability Performance. Abacus, 50(4), 422–459. https://doi.org/10.1111/abac.12036
Holder-Webb, L., Cohen, J. R., Nath, L., & Wood, D. (2009). The supply of corporate social responsibility disclosures among U.S. firms. Journal of Business Ethics, 84(4), 497–527. https://doi.org/10.1007/s10551-008-9721-4
Hooks, J., & van Staden, C. J. (2011). Evaluating environmental disclosures: The relationship between quality and extent measures. British Accounting Review, 43(3), 200–213. https://doi.org/10.1016/j.bar.2011.06.005
Irham, A. R., Yuliana, S., & Widiyanti, M. (2018). The effect firm characteristic on corporate social responsibility disclosure in the firms listed in Indonesia Sharia Stock Index. Jurnal Perspektif Pembiayaan Dan Pembangunan Daerah, 6(3), 303–318. https://doi.org/10.22437/ppd.v6i3.5820
Izzo, M. F., & di Donato, F. (2012). The Relation between Corporate Social Responsibility and Stock Prices: An Analysis of the Italian Listed Companies. SSRN Electronic Journal ·, (January). https://doi.org/10.2139/ssrn.1986324
Ji, Y., Xu, W., & Zhao, Q. (2019). The real effects of stock prices: learning, disclosure and corporate social responsibility. Accounting & Finance, (71771091), acfi.12494. https://doi.org/10.1111/acfi.12494
Juhmani, O. (2014). Determinants of Corporate Social and Environmental Disclosure on Websites : the Case of Bahrain. Universal Journal of Accounting and Finance 2(4):, 2(4), 77–87. https://doi.org/10.13189/ujaf.2014.020402
Kamatra, N., & Kartikaningdyah, E. (2015). Effect Corporate Social Responsibility on Financial Performance. International Journal of Economics and Financial Issues, 5, 157–164.
Kansal, M., Joshi, M., & Batra, G. S. (2014). Determinants of corporate social responsibility disclosures: Evidence from India. Advances in Accounting, 30(1), 217–229. https://doi.org/10.1016/j.adiac.2014.03.009
Kaskeen, M. Y. M. (2017). Corporate Social Responsibility and Corporate Financial Performance: Case Study of Pakistan. Universal Journal of Management, 5(10), 457–476. https://doi.org/10.13189/ujm.2017.051001
Khajavai, S., Taghizadeh, R., & Maharluie, M. S. (2016). Corporate social responsibility and stock price crash risk: Evidence from an Asian emerging market. Iranian Journal of Accounting, Auditing & Finance, 2(1), 95–114. https://doi.org/10.1108/MF-10-2015-0278
Kim, Y., Li, H., & Li, S. (2014). Corporate social responsibility and stock price crash risk. Journal of Banking and Finance, 43(1), 1–13. https://doi.org/10.1016/j.jbankfin.2014.02.013
Klerk, M. De, Villiers, C. de, & Staden, C. van. (2015). The influence of corporate social responsibility disclosure on share prices Evidence from the United Kingdom. Pacific Accounting Review, 27(2), 208–228. https://doi.org/http://dx.doi.org/10.1108/MRR-09-2015-0216
Liu, X., & Anbumozhi, V. (2009). Determinant factors of corporate environmental information disclosure: an empirical study of Chinese listed companies. Journal of Cleaner Production, 17(6), 593–600. https://doi.org/10.1016/j.jclepro.2008.10.001
Loderer, C., & Waelchli, U. (2010). Protecting minority shareholders: Listed versus unlisted firms. Financial Management, 39(1), 33–57. https://doi.org/10.1111/j.1755-053X.2009.01065.x
Lu, Y., & Abeysekera, I. (2014). Stakeholders’ power, corporate characteristics, and social and environmental disclosure: Evidence from China. Journal of Cleaner Production, 64, 426–436. https://doi.org/10.1016/j.jclepro.2013.10.005
Lucyanda, J., & Siagian, L. G. (2012). The influence of Corporate characteristics on Corporate Social Responsibility Disclosure. The 2012 International Conference on Business and Management, (September), 601–619.
Madugba, J., & Okafor, M. (2016). Impact of Corporate Social Responsibility on Financial Performance: Evidence from Listed Banks in Nigeria. International Journal of Learning and Development, 4, 1–9. https://doi.org/10.5296/ijld.v2i6.2717
Müller, L., & Wikström, M. (2016). Corporate Social Responsibility and its effect on stock price. Jönköping.
Narullia, D., Subekti, I., Azizah, N., & Purnamasari, F. (2019). Value Relevance of Corporate Social Responsibility Disclosure on Public Companies in ASEAN Countries. KnE Social Sciences, 3(11), 475. https://doi.org/10.18502/kss.v3i11.4027
Noordin, M. A., & Mohtar, D. S. (2014). Age: Does it Matter for Firms to Perform? International Journal of Academic Research in Business and Social Sciences, 4(3), 252–260. https://doi.org/10.6007/IJARBSS/v4-i3/704
Nurcahyanti, I., & Widhianningrum, P. (2018). The Environmental Aspect of Companies as A Determinant of Stock Prices. Assets: Jurnal Akuntansi Dan Pendidikan, 7(2), 105. https://doi.org/10.25273/jap.v7i2.2302
Oeyono, J., Samy, M., & Bampton, R. (2011). Journal of Global Responsibility. Journal of Global Responsibility, 2(1), 100–112. Retrieved from http://dx.doi.org/10.1108/20412561111128555%0Ahttp://dx.doi.org/10.1108/17471111111141549
Ortas, E., Álvarez, I., Zubeltzu, E., Ambe, C. M., Burritt, R., Ngwakwe, C. C., & Lee, K.-H. (2017). Firms’ Board Independence and Corporate Social Performance: A Meta-Analysis. https://doi.org/10.3390/su9061006
Pan, X., Sha, J., Zhang, H., & Ke, W. (2014). Relationship between corporate social responsibility and financial performance in the mineral industry: Evidence from Chinese mineral firms. Sustainability (Switzerland), 6(7), 4077–4101. https://doi.org/10.3390/su6074077
Park, J. W., & Lee, C. W. (2018). Performance of stock price with changes in SRI governance index. Corporate Social Responsibility and Environmental Management, 25(6), 1121–1129. https://doi.org/10.1002/csr.1526
Prasojo, & Listyorini, I. (2015). The Influence of Corporate Social Responsibility toward the Financial Performance Company in Jakarta Islamic Index (JII) in Period 2010-2014. Global Review of Islamic Economics and Business, 3(2), 136–151.
Reverte, C. (2009). Determinants of corporate social responsibility disclosure ratings by Spanish listed firms. Journal of Business Ethics, 88(2), 351–366. https://doi.org/10.1007/s10551-008-9968-9
Santhirasegar, J., Ramakrishnan, S., Hishan, S., & Jamal, N. (2018). The Relationship Between Corporate Social Responsibility Practices and Firm Performance of Domestic Banks in Malaysia. International Journal of Engineering & Technology, 7(2.29), 451. https://doi.org/10.14419/ijet.v7i2.29.13797
Sethi, S. P., Martell, T. F., & Demir, M. (2017). An Evaluation of the Quality of Corporate Social Responsibility Reports by Some of the World’s Largest Financial Institutions. Journal of Business Ethics, 140(4), 787–805. https://doi.org/10.1007/s10551-015-2878-8
Shoukat Malik, M., & Nadeem, M. (2014). Impact of Corporate Social Responsibility on the Financial Performance of Banks in Pakistan. International Letters of Social and Humanistic Sciences, 21, 9–19. https://doi.org/10.18052/www.scipress.com/ilshs.21.9
Swandari, F., & Sadikin, A. (2016). The Effect of Ownership Structure, Profitability, Leverage, and Firm Size on Corporate Social Responsibility (CSR). Binus Business Review, 7(3), 315. https://doi.org/10.21512/bbr.v7i3.1792
Utama, S. (2011). An evaluation of support infrastructures for corporate responsibility reporting in Indonesia. Asian Business and Management, 10(3), 405–424. https://doi.org/10.1057/abm.2011.10
Uzliawati, L., Rosiana, R., Samudi, M., Nawaiseh, M. E., Boa, S., Zaid, R. A., & El-Shohnah, Y. (2015). Influence of Firm Size, Profitability and Size of Board of Commissioners on Corporate Social Responsibility Disclosures. Journal of Applied Finance & Banking, 2(6), 97–111.
Waluyo, W. (2017). Firm size, firm age, and firm growth on corporate social responsibility in Indonesia: The case of real estate companies. European Research Studies Journal, 20(4), 360–369.
Wang, M.-C. (2017). The Relationship between Firm Characteristics and the Disclosure of Sustainability Reporting. Sustainability, 9, 2–14. https://doi.org/10.3390/su9040624
Wang, Yu, H., & Ahsan, T. (2016). The Impact of Environmental Information Disclosure on Business Performance : Evidence from High-Polluting Industries in China. European Journal of Business and Management, 8(18), 13–21.
Withisuphakorn, P., & Jiraporn, P. (2016). The effect of firm maturity on corporate social responsibility (CSR): do older firms invest more in CSR? Applied Economics Letters, 23(4), 298–301. https://doi.org/10.1080/13504851.2015.1071464
Wuttichindanon, S. (2017). Corporate social responsibility disclosure—choices of report and its determinants: Empirical evidence from firms listed on the Stock Exchange of Thailand. Kasetsart Journal of Social Sciences, 38(2), 156–162. https://doi.org/10.1016/j.kjss.2016.07.002
Xu, S., & Liu, D. (2018). Do Financial Markets Care about Corporate Social Responsibility Disclosure? Further Evidence from China. Australian Accounting Review, 28(1), 79–103. https://doi.org/10.1111/auar.12161
Zaccheaus, S. A., Oluwagbemiga, O. E., & Olugbenga, O. M. (2014). Effects of corporate social responsibility performance ( CSR ) on stock prices : Empirical study of listed manufacturing companies Solomon Adeoluwa Zaccheaus , 2 Oyerogba Ezekiel Oluwagbemiga , Olaleye Michael Olugbenga. IOSR Journal of Business and Management, 16(8), 112–117.
Digital Object Identifier
DOI : https://doi.org/10.24198/jaab.v3i1.26228Dimension Citation Metrics Badge
Refbacks
- There are currently no refbacks.
Copyright (c) 2020 Journal of Accounting Auditing and Business
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Refbacks
- There are currently no refbacks.
Copyright (c) 2020 Journal of Accounting Auditing and Business
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Journal of Accounting Auditing and Business (JAAB) Indexed in:
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.