Page 1 of 6
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
e‐ISSN: 2395‐0463
Volume 01 Issue 09
October 2015
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ Page | 275
Corporate Social Reporting and Disclosure:
A Review of the Literature
CMA Dr. Meenu Maheshwari
Assistant Professor, Department of Commerce and Management,
University of Kota,Kota
drmeenumaheshwari@gmail.com
Puja Kaura
Research Scholar
Department of Commerce and Management,
University of Kota,Kota
kaurapuja23@gmail.com.
Abstract
In modern era much attention by companies
and researchers has been given to Corporate
Social Reporting and Disclosure (CSRD) and
considered as an important aspect of concern
for all of us. Being the contemporary area of
discussion in many countries around the world,
it arose as a companion to the social
responsibility’s discussion in 1960’s and early
1970’s. Globalization has brought with it a
wide realization that companies do not
operate in isolation, but can have marked
impact on the environment and the people at
local, national and global level. However,
with the enhancement standards of living, social
conditions and cognitive level, stakeholders
became aware and compelled their
organizations to disclose their accountability
towards society. The aim of this paper is to
briefly review the literature available on CSRD
both in developed and developing countries.
Further, this paper aims to contribute to the
limited literature of researches available
corporate social reporting and disclosure. As
concluded, researcher found that, in spite of
growing interest for corporate social reporting
and disclosure practices, it has been noted
that much of the research on corporate
social disclosure practice has been in
developed countries where as research
studies on corporate social reporting and
disclosure in developing economies is still
limited and has received little attention.
1. Introduction
A business enterprise is considered as a
social unit which conducts its activities
within the society therefore it is perceived
that business houses should fulfil its
responsibilities towards society. Traditional
management approaches regarded the
business unit as a robust economic engine
which drives shareholders wealth. But
modern management approach holds that
transparent economic and social progress
should go hand in hand. This concept led to
the emergence of Corporate Social Reporting
and Disclosure (CSRD). It has been noticed
that the earlier studies prior to 1980’s
resulted in normative statements about the
kinds of measuring and reporting systems
that should be employed by companies.
However, as a result of the world recession of
the mid-late 1970s, the location for such
disclosures became part of company’s
annual/financial report (American Institute of
Certified Public Accounting, 1977;
Schreuder, 1979), but the information that
was disclosed in this period in general terms
Page 2 of 6
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
e‐ISSN: 2395‐0463
Volume 01 Issue 09
October 2015
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ Page | 276
considered to be incomplete and imprecise.
Reporting and disclosure seemed to decline,
both as a phenomenon and as an area of
academic activity (Harte & Owen, 1991;
Mathews, 1997). In recent years, all themes
of corporate social disclosure, including
environmental issue, concerned many
researchers for conducting a large number of
academic studies and this changed the view
of companies’ responsibility towards society
as now the business has shifted its approach
from profit maximization to stakeholders’
maximization approach. The aim of this paper
is to review the literature available on CSRD both
in developed and developing countries. Further,
this paper aims to contribute to the limited
literature of researches available corporate social
reporting and disclosure.
2. A Review of Corporate Social Reporting
Studies
This section deals with the review of
literature related to corporate social reporting
and disclosure. For reviewing the literature
related to corporate social reporting and
disclosure practices categorization has been
done into two time periods (period before
1990) and (period after 1990).
2.1 Pre –Economic Liberalization Literature:
It was the time when subject was originated
and studies were not focused. The attempts
were made to develop the theoretical models.
Linowes, [1968] first created the term 'socio- economic accounting' in order to emphasize
the sociological, political and economic
aspects of accounting that had a considerably
broaden the scope than conventional
accounting paradigm. In 1971, Ross selected
the term which can be used in place of social
responsibility accounting term. In 1973,
Marlin found relationship of social
accounting with pollution accounting. Rabun
and Williams (1974) instituted the
relationship of social accounting with role of
accountant. In 1976 Ramanathan emphasized
the concepts essential for accounting: A
social income, a social overhead, social
constituents, social transaction, net social
asset and social equity. Ernst & Ernst (1978)
aimed at investigating the CSRD practices in
USA by analyzing the 500 fortune US
companies’ annual reports in their study. The
results of the study indicated that there was
decrease in disclosure practices from 91.2%
to 89.25%.Trotman (1979) conducted the
study in Australia. The study concluded that
the Australian companies disclosed social
responsibility activities with the human
resource and environment as the most
frequent measurement themes in their annual
report. Singh and Ahuja (1983) conducted the
simple descriptive study to investigate the
extent of CSRD in Indian public companies
annual reports and found that the
manufacturing companies make more
disclosure than the service companies. Patten
(1990) investigated that whether investors
use the social information in making
investment decisions by adapting model
based mythology employed Beaver in 1986.
Guthrie and Parker (1990) conducted a
longitudinal study covering 50 largest
companies for period of 100 years in UK, US
and Australia. Their study revealed that due
to economic, political, social ,geographical,
environmental, regulatory and cultural
differences it could not be appropriate to
generalize the result of studies of developed
nations to new developed countries.
2.2 Post Economic Liberalization Literature
(Period after 1990)
This period is enriched with social
accounting literature. Basically, two methods
– content analysis and measurement method
were primarily used by most of research
studies conducted during this period.
Page 3 of 6
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
e‐ISSN: 2395‐0463
Volume 01 Issue 09
October 2015
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ Page | 277
Panda (1991) propounded that the challenge
to bring in practicability in social accounting
still remains unaccomplished job before the
academics and practicing accountant. Tilt
(1994) used theoretical framework of
legitimacy to discuss corporate
environmental and social disclosure
practices. Lavers (1995) asserted economy
theory believed that the economic takes place
within political, social and institutional
framework. Hegde (1997) conducted a micro
level study on Corporate Social Disclosures
in India on SAIL and found that company has
disclosed social balance sheet and social
income statement. William (1999) conducted
the study to provide empirical evidence on
the significant cross country variables that
may assist in explaining variables in the
quantity of voluntary environmental and
social accounting disclosure information
provided by companies’ annual reports across
national boundaries. Abhur Belal (1999)
conducted the study in Bangladesh and found
that most of the companies in Bangladesh
disclose mainly information on employees
followed by the environmental information
and very less emphasis were paid on ethical
information. Campbell (2000) asserted that
the incentives are the important factors in
studying the CSRD. He also emphasized the
agency theory in his study. Carol (2001)
conducted study on the company named
Alpha in which he used the case study
analysis approach. The researcher
recommended the need of reporting
guidelines along with the change in corporate
governance system. Belal (2001) conducted
study in the Bangladesh. In his study he
pointed the lack of adequate research in
CSRD in developing countries. Adams
(2002) undertook the study with the aim of
identifying any internal contextual factors
which influenced the extent and nature of
corporate social reporting. Douglas (2003)
deliberated through his research that a
company operating in a more developed
country is likely to disclose more than the
company operating in lesser developed
countries. Cowen (2004) studied the trend
patterns, nature and frequency of CSRD and
concluded the existence of positive
relationship of CSRD with corporate size and
profitability. KPMG (2005) carried on the
survey on two set of companies. First set of
companies consisted of 250 companies listed
in global fortune 500 and second set consist
of top 100 companies (N100) in 16 countries- Norway , Italy, Canada, Australia, Finland,
Germany, France, Japan, Belgium,
Netherland ,Sweden, Denmark, South Africa
, Spain, USA, UK. It conducted the parallel
analysis created in his research. Raman
(2006) conducted study on the basis of
annual reports of top 50 companies in India.
But his study was only confined to
chairmen’s message and letters to
shareholders sections in the annual reports.
Raghu (2006) undertook the study to analyze
chairmen’s message of annual reports of top
50 companies in India. In order to find the
extent of nature of social reporting he had
used the content analysis. Gupta (2007)
conducted an explorative research for
knowing the social responsibility of corporate
sector in India. He found that trends in
socially responsible initiatives are increasing
as well as crucial in India. Chaudhary and
Wang (2007) found that the corporates in
India are lack in proactive CSR
communication and they found that
companies perform CSR activities but did not
disclose them properly. Nazli (2007) carried
out the study in Malaysia by using company
annual reports. His study was aimed at
finding out association between ownership
structure and extent of CSR disclosure. Islam
& Deegan (2008) described and explain the
social and environmental reporting practices
of a major garment export companies in
Bangladesh. In another study sector specific
