Corporate Characteristics, Corporate Social Responsibility, Environmental Information Disclosure, Egyptian Stock Exchange
Companies with good Reputations not only depend on financial results but also on their contribution in environment and social responsibility and sustained growth. This is what the researchers are trying to prove over the past 30 years but still there is no consensus on the validity of this statement, therefore it became one of the debatable areas whether the Corporate Social Responsibility (CSR) can affect the organization financially or economically. Environmental information disclosure (EID) has become an important part in the process of the annual report, the social responsibility report and other information disclosure. This paper aims to assess the impact of several Corporate Characteristics on environmental information disclosure of the listed firms in a developing country. It selects the 50 most active firms in the Egyptian stock exchange and the analysis is done using the financial statements from the disclosure book for the period 2007-2011, prior the revolution, along with the firms’ annual reports. The final count for the firms is 45, after excluding banks and insurance companies, for having different disclosure requirements and different corporate governance code. The tests for this research are done using the multiple regression model applied using the SPSS. Findings found that there is an insignificant relationship between two factors of firms’ characteristics (Firm Size and Firm Financial Leverage) and EID, while Firm’s age showed a negative significant relationship with EID and finally Firm’s Profitability showed a positive significant relationship with EID.
Full Text : PDF
- Ahmad, Z., Hassan, S., & Mohammad, J. (2003). Determinants of Environmental Reporting in Malaysia, International Journal of Business Studies, 11(1), 69-90.
- Ahmed, N. & Mousa, F. (2010). Corporate environmental disclosure in Libya: A little improvement, World Journal of Entrepreneurship, Management and Sustainable Development, 6(1-2), 149-159.
- Akbas, H. & Canikli, S. (2014). Corporate Environmental Disclosures in a Developing Country: An Investigation on Turkish Listed Companies, 6(2), 50-57.
- Al-Tuwaijri, S., Christensen, T. & Hughes II, K. (2004). The Relations among Environmental Disclosure, Environmental Performance, and Economic Performance: A Simultaneous Equations Approach. Accounting, Organizations and Society, 29(4-5), 447-471.
- Andrikopoulos, A. & Kriklani, N. (2013). Environmental disclosure and financial characteristics of the firm: the case of Denmark, Corporate Social Responsibility and Environmental Management, 20(1), 55-64.
- Arrow, K. (1962). The economic implications of learning by doing. American Economic Review, 29(3), 155-173.
- Baharuddin, N., Khamis, Z., Mansor, W., Mahmoud, W. & Dollah, H. (2011). Determinants of capital structure for listed construction companies in Malaysia, Journal of Applied Finance & Banking, 1(2), 115-132.
- Barako, D., Hancock, P. & Izan, H. (2006). Factors Influencing Voluntary Corporate Disclosure by Kenyan Companies, Corporate Governance: An International Review, 14(2), 107-125.
- Belal, A. (1999). Corporate Social Disclosure in Bangladesh Annual Reports. The Bangladesh Accountants, ICAB, 27(1), 76-81.
- Belkaoui, A. & Philip G. (1989). Determinants of the Corporate Decision to Disclose Social Information. Accounting, Auditing and Accountability Journal, 2(1), 36- 51.
- Brammer, S. & Pavelin, S. (2008). Factors Influencing the Quality of Corporate Environmental Disclosure, Business Strategy and the Environment 17(2), 120–136.
- Brammer, S., & Pavelin, S. (2006). Voluntary environmental disclosures by large UK companies. Journal of Business Finance & Accounting, 33(7-8), 1168-1188.
- Bryman, A. & Cramer, D. (1997). Quantitative Data Analysis with SPSS for Windows: A Guide for Social Scientists, 2nd, ed., Routledge.
- Buferna, F., Bangassa, K. & Hodgkinson, L. (2005). Determinants of Capital Structure: Evidence from Libya, Research Paper Series 8, University of Liverpool.
- Carreira F., Damião A., Abreu R. & David F. (2014). Environmental Disclosure from the Accounting to the Report Perspective. In Proceedings of the 16th International Conference on Enterprise Information Systems, working paper, 3, 496-501.
- Chang, k. (2011). The Effects of Ownership and Capital Structure on Environmental Information Disclosure: Empirical Evidence from Chinese Listed Electric Firms. School of Finance, 2(12), 637–649.
- Chen, J. (2003). Determinants of capital structure of Chinese-listed companies. Journal of Business Research, 57(12), 1341-51.
- Cho, C. & Patten, D. (2007). The role of environmental disclosures as tools of legitimacy: A research note. Accounting, Organizations and Society, 32(7), 639-647.
- Cho, C., Roberts, R. & Patten, D. (2010). The language of US corporate environmental disclosure. Accounting, Organizations and Society, 35(4), 431-443.
- Choi, J. (1999). An investigation of the initial voluntary environmental disclosures made in Korean semi-annual financial reports. Pacific Accounting Review, 11(1), 73-102.
- Clarkson, P., Overell, M. & Chapple, L. (2011). Environmental reporting and its relation to corporate environmental performance. Abacus, 4(1), 27-60.
- Clarkson, P., Richardson, G. & Vasvari, F. (2008). Revisiting the relation between environmental performance and environmental disclosure: an empirical analysis. Accounting, Organizations and Society, 33(4-5), 303-327.
- Cohen, L., Manion L., & Morrison K. (2007). Research methods in education. Routledge, 0-203-02905-4.
- Cormier, D. & Gordon, I. (2001). An examination of social and environmental reporting strategies. Accounting, Auditing - Accountability Journal, 14(5), 587-617.
- De Villiers, C. & van Staden, C. (2011). Where firms choose to disclose voluntary environmental information. Journal of Accounting and Public Policy, 30(6), 504-525.
- Deegan, C. (2002). Introduction: the legitimizing effect of social and environmental disclosures - a theoretical foundation. Accounting, Auditing & Accountability Journal, 15(3), 282-311.
- Despina, G., Efthymios, G. & Antonios, S. (2011). The Relation between Firm Size and Environmental Disclosure. International Conference on Applied Economics – ICOAE 2011, 179-186.
- Ebiringa, O., Emeh, Y. & Obi, J. (2013). Effect of Firm Size and Profitability on Corporate Social Disclosures: The Nigerian Oil and Gas sector in Focus. British Journal of Economics, Management & Trade, 3(4), 563-574.
- Ebrahim, M., Soliman, S. & Rezk, A. (2015). Influence of Firm Size and Profitability on Corporate Social Responsibility Disclosures by Banking Firms (CSRD): Evidence from Jordan. Journal of Applied Finance & Banking, 5(6), 97-111.
- Ericson R., & Pakes A., (1995). Markov-perfect industry dynamics: a framework for empirical work. The Review of economic studies, 62(1), 53-82.
- Gray, R. (2006). Does Sustainability Reporting Improve Corporate Behaviour? Wrong Question? Right Time? Accounting and Business Research, 36(1), 65-88.
- 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.
- Greene, W. (2012). Econometric Analysis. London: Prentice Hall Inc. 7th Edition.
- Gupta, A. (2008). Global environmental politics, Transparency under Scrutiny: Information Disclosure in Global Environmental Governance, 8(2), 1-7.
- Harris, L., Scaramozzino, P., & Fattouh, B. (2005). Capital structure in South Korea: a quantile regression approach. Journal of Development Economics, 76(1), 231- 250.
- Hartikayanti, H., Trisyardi, M. & Saptono B. (2016). Effect of corporate characteristics on environmental disclosure. IJABER, 14(10), 6111-6134.
- Ho, L. & Taylor, M. (2007). An Empirical Analysis of Triple Bottom‐Line Reporting and its Determinants: Evidence from the United States and Japan. Journal of International Financial Management - Accounting, 18(2), 123-150.
- Ho, R. (2006). Handbook of Univariate and Multivariate Data Analysis and Interpretation with SPSS, 3rd, ed., Taylor and Francis Group.
- Huang, C. & Kung, F. (2010). Drivers of environmental disclosure and stakeholder expectation: Evidence from Taiwan. Journal of Business Ethics, 96(3), 435-451.
- Iwata, H. & Okada K. (2011). How does environmental performance affect financial performance? Evidence from Japanese manufacturing firms. Ecological Economics, 70(9), 1691–1700.
- Jensen, M. & Meckling, W. (1976). The Agency Theory of the Firm: Managerial Behavior, Agency Cost and Ownership Structure. Journal of Financial Economics 3(4), 305-360.
- Jovanovic, G. & Hart, O. (1982). Corporate financial structure and managerial incentives, in McCall, J. (Ed.), The Economics of Information and Uncertainty, University of Chicago press, Chicago, IL.
- Juhmani, O. (2014). Determinants of Corporate Social and Environmental Disclosure on Websites: The Case of Bahrain. 2(4), 77 – 87.
- Julius, O (2016). The Effect of Profitability to the Disclosure of Corporate Social Responsibility on Mining Companies Listed on Indonesian Stock Exchange in the Year 2010-2012. Journal of Business and Management,18(6),69-78
- Kathyayini, K., Tilt, C. & Lester, L. (2012). Corporate governance and environmental reporting: an Australian study. Corporate Governance, 12(2), 143-163.
- Kuk, G., Fokeer, S. & Hung, W. (2005). Strategic Formulation and Communication of Corporate Environmental Policy Statements: UK Firms’ Perspective. Business Ethics, 58(4), 375-385.
- Lang, M. & Lundholm, R. (1993). Cross sectional Determinants of Analysts Ratings of Corporate Disclosures. Journal of Accounting Research. 31(2), 246-271.
- Lim, S., Matolcsy, Z. & Chow D. (2007). The Association between Board Composition and Different Types of Voluntary Disclosure. European Accounting Review, 16(3), 555-583.
- 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.
- McMurtrie, T. (2005). Factors influencing the publication of social performance information: an Australian case study. Corporate social responsibility and environmental management, 12(3), 129-143.
- Michelon, G. & Parbonetti, A. (2012). The effect of corporate governance on sustainability disclosure. Journal of Management - Governance, 16(3), 477-509.
- Milne, M. & Patten, D. (2002). Securing organizational legitimacy. An experimental decision case examining the impact of environmental disclosures. Accounting, Auditing & Accountability Journal, 15(3), 372-405.
- Milne, M. & Adler, R. (1999). Exploring the reliability of social and environmental disclosures content analysis. Accounting, Auditing & Accountability Journal, 12(2), 237 – 256.
- Montero, M., Perez, P. & Esteban, C. (2011). Corporate Environmental Disclosure and Legitimacy Theory: A Europe Perspective. Environmental Engineering - Management Journal (EEMJ), 10(12), 1883-1991.
- Mueller D. (1972). A Life Cycle Theory of the Firm. Journal of Industrial Economics, 20(3), 199-219.
- Neyland, D. (2007). Achieving Transparency: The Visible, Invisible and Divisible in Academic Accountability Networks, Organization. SAGE, 14(4), 499-516.
- Nur, M. (2012). Analisis Faktor-Faktor yang Mempengaruhi Pengungkapan Corporate Social Responsibility di Indonesia: Studi Empiris pada Perusahaan Berkategori High Profile Yang Listing di Bursa Efek Indonesia. Journal Nominal, 1(1), 22-34.
- Pahuja, S. (2009). Relationship between environmental disclosures and corporate characteristics: a study of large manufacturing companies in India. Social Responsibility Journal, 5(2), 227-244.
- Patten, D. (2002). The relation between environmental performance and environmental disclosure. Accounting, Organizations and Society, 27(8), 763-773.
- Patten, D. (1992). Intra-industry environmental disclosures in response to the Alaskan oil spill: a note on legitimacy theory. Accounting, Organizations and Society, 17(5), 471-475.
- Permana, V. & Raharja, A. (2012). Pengaruh kinerja lingkungan dan karakteristik perusahaan terhadap corporate social responsibility (csr) disclosure: Studi Empiris pada Perusahaan Manufaktur yang Terdaftar di BEI. Diponegoro Journal of Accounting, 1(2), 1-12.
- Roberts, R. (1992). Determinants of corporate social responsibility disclosure: an application of stakeholder theory. Accounting, Organizations and Society, 17(6), 595-612.
- Saha, A. & Akter, S. (2013). Relationship between environmental reporting in corporate annual reports and corporate profitability in Bangladesh. Global Conference on Business - Finance Proceedings, 8(1), 75-86.
- Sembiring, E. (2005). Karakteristik Perusahaan Dan Pengungkapan Tanggung Jawab Sosial: Study Empiris Pada Perusahaan Yang Tercatat Di Bursa Efek Jakarta. Simposium Nasional Akuntansi, 8(1), 379-395.
- Soliman M. (2013). Firm Characteristics and the Extent of Voluntary Disclosure: The Case of Egypt. Research Journal of Finance and Accounting, 4(17), 71-80.
- Suttipun, M., & Stanton, P. (2012). A study of Environmental Disclosures by Thai listed Companies on Websites. Procedia Economics and Finance, 2(14), 9–15.
- Uwuigbe, U. (2012). Web-Based corporate environmental reporting in Nigeria: A study of listed companies. Informatica Economica, 16(3), 27-36.
- Veronica, T. (2009). Pengaruh karakteristik perusahaan terhadap pengungkapan tanggungjawab sosial pada perusahaan sektor pertambangan yang terdaftar di bursa efek Indonesia, Fakultas Ekonomi. Universitas Gunadarma, university paper, 1-11.
- Zeng, S., Xu, X., Yin, H. & Tam, C. (2012). Factors that drive Chinese listed companies in voluntary disclosure of environmental information. Journal of Business Ethics, 109(3), 309-321.
Appendix A- Index of Environmental Disclosure
Annual Report (16 items)
Environmental programs and policies (0-1).
Preventive measures/environmental protection (0-1).
Compliance with environmental regulations (0-1).
Reference to certification (0-1).
Environmental investments/capital expenditures (past and in the current year) (0-1).
Environmental performance/risks and impact on the environment (quantitative information) (0-1).
Environmental indicators (0-1).
Environmental management system (0-1).
Training on the environment (0-1).
External environmental audit (0-1).
Future environmental investment & expenditures (0-1).
Awards and recognition related to the environment (0-1).
Mention of improvements made year by year (0-1).
Mention of an environmental/sustainability report (0-1).
Initiative, awareness campaign, study, conferences (0-1).