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Article
Publication date: 23 May 2023

Yosra Mnif and Jihene Kchaou

This paper aims to investigate the relationship between the readability of sustainability reports and assurance provider effort, captured by assurance delay and the moderating…

Abstract

Purpose

This paper aims to investigate the relationship between the readability of sustainability reports and assurance provider effort, captured by assurance delay and the moderating effect of the assurance provider.

Design/methodology/approach

This sample consists of companies operating in sustainability sensitive industries from 39 countries for the period that covers the years 2016–2018.

Findings

The results show that poor sustainability reporting readability is associated with longer assurance delays. Indeed, assurance providers spend more effort assuring clients when sustainability reports are less readable, as shown by long assurance delay. In addition, increases in assurance delay associated with poor sustainability reporting readability are driven by accounting assurance providers. These results hold after controlling for endogeneity using Heckman's (1979) analysis and other measures of assurance delay readability used in prior literature. By checking the specialization of assurance provider partners and setting aside dominant countries, the authors provide insight into the impact of assurance provider specialization on the association between sustainability report readability and assurance provider effort measured by assurance delay and thus, lending further confidence to the strength of the study’s main findings.

Research limitations/implications

This research provides preliminary evidence on the relationship between sustainability reporting readability and assurance delay as well as the influence of accounting assurance providers.

Practical implications

Sustainability assurance practice is viewed as a tool to add or enhance credibility. This study could be considered as another step into driving the standardization of sustainability reporting practice internationally.

Originality/value

This is the first investigation conducted in the sustainability literature on the assurance provider's response to the readability of sustainability reports.

Details

Asian Review of Accounting, vol. 31 no. 5
Type: Research Article
ISSN: 1321-7348

Keywords

Article
Publication date: 22 December 2021

Yosra Mnif and Jihene Kchaou

This paper aims to explore the relationship between the readability of sustainability reports and chief executive officer (CEO) attributes, comprising monetary, non-monetary…

Abstract

Purpose

This paper aims to explore the relationship between the readability of sustainability reports and chief executive officer (CEO) attributes, comprising monetary, non-monetary incentives and personal characteristics.

Design/methodology/approach

The study is based on an international sample of companies operating in sustainability-sensitive industries during 2016–2018.

Findings

The results prove that CEO monetary incentives, as well as CEO non-monetary incentives, negatively influence the readability of sustainability reports, revealed in a positive relationship with readability indexes, by providing reports with greater reading difficulty. Additionally, this study shows evidence about the relation of complementarity between these incentives. Other CEO characteristics have no significant effect on the readability of sustainability reports.

Originality/value

This research sheds the light on the role of CEO incentives in obfuscating sustainability information to portray the company, operating in sustainability-sensitive industries, in a favorable image.

Details

Meditari Accountancy Research, vol. 31 no. 3
Type: Research Article
ISSN: 2049-372X

Keywords

Article
Publication date: 5 September 2018

Abdullah S. Karaman, Merve Kilic and Ali Uyar

The purpose of this study is to investigate empirically what affects Global Reporting Initiative (GRI)-based sustainability reporting and its relationship with firm performance in…

6196

Abstract

Purpose

The purpose of this study is to investigate empirically what affects Global Reporting Initiative (GRI)-based sustainability reporting and its relationship with firm performance in the aviation industry between 2006 and 2015.

Design/methodology/approach

The authors derived data from the GRI Sustainability Disclosure Database and Thomson Reuters EIKON; from the former, they downloaded GRI-based reports, and from the latter, they obtained financial data. The authors performed four-level analysis – report existence, report count, application level of report and firm performance –using various regression models (i.e. logistic regression, Poisson regression, ordered logistic regression and ordinary least squares regression).

Findings

First, the authors based the analysis on the existence of GRI-based sustainability reports, which showed that firm size and leverage are positively associated with sustainability reporting. Contrary to expectations, ownership was negatively associated. Furthermore, free cash flow per share, growth and profitability do not have significant effects on sustainability reporting, in contrast to expectations. Subsequent analysis was based on report count (number of total published reports within the examination period) and application levels of reports. Compared to the preceding analysis, there were no notable surprises. In addition, we found evidence that growth is negatively associated with application levels of reports (partially supported). Thus, report existence, report count and application level results largely confirm each other. Finally, the authors tested the effect of sustainability reporting on firm performance, which did not produce significant results. Thus, in the aviation industry, sustainability reporting does not play a significant role in enhancing firm performance.

Practical implications

First, the findings show that larger and highly leveraged aviation firms can reduce agency and legitimacy costs through sustainability reporting. Surprisingly, the same assumption did not hold for ownership structure as the firms with diffused ownership base tend not to publish sustainability reports. Thus, boards are advised to establish and improve monitoring mechanisms in these types of firms. Second, although the number of aviation companies publishing separate sustainability reports has increased significantly over the years, almost half of the companies are not still producing sustainability reports. Hence, if the aviation industry believes the merits of engaging in sustainability issues and sincerely desires to enhance its sustainability reporting practices, the authors can suggest the following initiatives. Boards might encourage companies to incorporate sustainability issues into company operations by assigning the necessary financial and human resources. The boards might also establish a separate sustainability committee or department, which could focus on sustainability issues and reporting practices. Regulatory bodies could also encourage aviation companies to act in a socially and environmentally responsible manner by proposing legal requirements and providing guidance.

Social implications

Relevant civil organisations and environmental activists might undertake more active roles to enhance awareness of sustainability issues in the aviation industry.

Originality/value

Most of the prior studies did not focus on standalone GRI-based sustainability reports, and they were conducted on limited samples and not the aviation industry in particular. This study aims to fill these gaps empirically by establishing testable hypotheses and attempting to demonstrate the validity of theoretical relationships in a wide range of data and among aviation companies worldwide. In this sense, this study is unique in what it undertakes. This study also tests whether sustainability reporting impacts firm value in the aviation industry which, to the best of the authors’ knowledge, has not been examined in prior studies to this extent.

Details

Sustainability Accounting, Management and Policy Journal, vol. 9 no. 4
Type: Research Article
ISSN: 2040-8021

Keywords

Article
Publication date: 8 November 2022

J.-L.W. Mitchell Van der Zahn

To investigate, compare and document the magnitude and extent of intellectual capital disclosure to sustainability disclosure during a transition from a voluntary to mandated…

Abstract

Purpose

To investigate, compare and document the magnitude and extent of intellectual capital disclosure to sustainability disclosure during a transition from a voluntary to mandated “comply or explain” sustainability reporting regime. And to empirically test if, during the regime transition period, changes in the magnitude (extent) of sustainability disclosure is a significant determinant of changes in the magnitude (extent) of intellectual capital disclosure.

Design/methodology/approach

Content analysis of 1,744 annual reports drawn from 436 Singapore listed firms spanning a four-year observation window (i.e. April 1, 2014 to March 31, 2018). The magnitude (number of sentences) and extent (number of items) of (1) intellectual capital disclosure measured using a 38-item index; (2) sustainability disclosure of a 105-item index; and (3) 15-item index to measure the magnitude and extent of joint sustainability/intellectual capital disclosure.

Findings

The average magnitude and extent of sustainability and the joint sustainability/intellectual capital disclosure increased whilst the average magnitude and extent of intellectual capital disclosure increased when regulatory discussion of a change to mandated sustainability reporting emerged. However, in the annual period the mandated sustainability reporting became effective while the average magnitude and extent of intellectual capital disclosure declined. Regression tests indicate a significant (insignificant) association between the change in the magnitude (extent) of sustainability disclosure and intellectual capital disclosure.

Research limitations/implications

From a research perspective, the analysis implies researchers investigating the consequences of mandated sustainability disclosure should consider impact on alternative non-financial disclosure themes and develop theoretical frameworks to derive why and how management may shift non-financial reporting strategies and practices.

Practical implications

For regulators, findings suggest there may be a need to weigh spillover costs of reductions in transparency related to intellectual capital. For investors, declines in the magnitude and extent of intellectual capital disclosure following a transition to mandated sustainability reporting may limit future firm valuation particularly of heavy intangible asset-oriented firms.

Originality/value

Initial study empirically investigating the impact of the transition from a voluntary to mandated sustainability reporting regime on the magnitude and extent of intellectual capital disclosure.

Details

Journal of Applied Accounting Research, vol. 24 no. 3
Type: Research Article
ISSN: 0967-5426

Keywords

Open Access
Article
Publication date: 29 November 2021

Sarah Russo, Federico Schimperna, Rosa Lombardi and Pasquale Ruggiero

This paper aims to present a deep understanding of how social media affects organisations’ sustainability performance, using environmental, social and governance (ESG) factors…

6493

Abstract

Purpose

This paper aims to present a deep understanding of how social media affects organisations’ sustainability performance, using environmental, social and governance (ESG) factors. Particularly, this paper assumes the existence of a causal relationship between organisations’ sustainability performance and the use of their social media profile (i.e. Twitter).

Design/methodology/approach

The authors used a multivariate regression with an explorative approach. Using Thomson Reuters Eikon, the authors composed a sample of 115 public EU companies with a headquarter in Europe operating in the “energy” and “utilities” sectors. The authors collected ESG-related, financial and Twitter-related data covering the period 2016–2019.

Findings

The study findings emphasise the existence of a statistically significant and positive relationship between social media profiles (i.e. Twitter) and companies’ sustainability performance. Findings show that ESG-oriented companies use their Twitter profile more as a tool for achieving a higher level of legitimation rather than for managing their sustainability strategy and related performance. Therefore, social media contribute more to the construction of companies’ CSR identity than the management of analytic aspects of sustainability performance. The longevity of companies’ profiles is the variable mostly showing a causal relationship not only with the general measure of companies’ sustainability performance but also with its pillars and sub-pillars.

Originality/value

This research is original in showing academics, practitioners and policymakers results on the impact of different modalities of interaction (retweets, replies, likes and quotes) between organisations and stakeholders by using social media on sustainability performance.

Details

Meditari Accountancy Research, vol. 30 no. 4
Type: Research Article
ISSN: 2049-372X

Keywords

Article
Publication date: 8 April 2022

Fahad Khalid, Khwaja Naveed, Xingxing He and Chenyun Ye

Given the emerging importance of the chief financial officer’s (CFO) role, this study aims to probe into the prevalence of corporate social responsibility (CSR) assurance…

Abstract

Purpose

Given the emerging importance of the chief financial officer’s (CFO) role, this study aims to probe into the prevalence of corporate social responsibility (CSR) assurance practices in China and to examine whether or not CFO foreign, professional or academic experience affects the likelihood of CSR assurance decision.

Design/methodology/approach

All A-share listed Chinese companies during the year 2008–2017 with 5,144 firm-year observations have been investigated for this study.

Findings

This study finds a positive effect of CFO foreign and professional experience on CSR assurance. No significant association has been found between the CFO’s academic experience and CSR assurance. Additional analysis for Global Reporting Initiative (GRI) sampled firms shows that the academic and professional experience of CFOs has a significant positive association with CSR assurance. However, the main findings are replicated in the case of firms under mandatory CSR reporting.

Research limitations/implications

The limitations of this study are its generalizability, unidimensional measure of CSR assurance which is unable to capture its quality and explore the other traits of CFOs.

Practical implications

It provides assurance practitioners with valuable longitudinal data on China’s CSR reporting and assurance services. Also, firms should recognize the importance of having competent CFOs to improve the credibility of their CSR reporting. The cross-sectional variation analysis (GRI and mandatory CSR) will help firms to assess the value of each CFO attribute for their nonfinancial reporting and auditing choices while considering internal and external stakeholder demands.

Originality/value

This study not only updates the existing understanding of CSR assurance methods in China but also explains the significance of CFO-specific experience in enhancing the credibility of nonfinancial reporting.

Details

Society and Business Review, vol. 17 no. 4
Type: Research Article
ISSN: 1746-5680

Keywords

Article
Publication date: 19 May 2021

Khaldoon Albitar, Habiba Al-Shaer and Mahmoud Elmarzouky

The COVID-19 pandemic has been adding pressures on companies to commit to their social and ethical responsibilities. Corporate social responsibility (CSR) reporting is the main…

1181

Abstract

Purpose

The COVID-19 pandemic has been adding pressures on companies to commit to their social and ethical responsibilities. Corporate social responsibility (CSR) reporting is the main tool through which companies communicate their social behaviour and the need for credible information is censorious during the crisis. This paper aims to measure the level of COVID-19 disclosures in CSR reports by using an automated textual analysis technique based on a sample of UK companies and investigate whether the level of disclosure is enhanced for companies that subject their CSR reports to an assurance process.

Design/methodology/approach

The study sample consists of FTSE All-share non-financial listed companies. The authors use a computer-aided textual analysis, and we use a bag of words to capture COVID-related information in the CSR section of the firm’s annual reports.

Findings

The results suggest that the existence of independent external assurance is significantly and positively associated with the provision of COVID-19 information in CSR reports. The authors also find that when assurance is provided by Big 4 accountancy firms, the disclosure of COVID-related information is enhanced. Furthermore, large companies are more likely to disclose COVID-related information in their CSR reports that are externally assured from top-tier accountancy firms, suggesting that assurance could be a burden for smaller firms. Overall, the findings suggest that assurance on CSR reports provides an “insurance-like” protection that mitigates the risks and signals the management’s ethical behaviour during the pandemic.

Practical implications

The study approach helps to assess the level of corporate engagement with COVID-19 practices and the extent of related disclosures in CSR reports based on the COVID-19 Secure Guidelines published by the UK government. This helps to emphasise how companies engage and communicate COVID-19-related information to stakeholders through CSR reports and ensure a safe working environment during this pandemic. Managers will need to assess the costs and benefits of purchasing assurance on CSR disclosures, giving the ethical signal that assurance sends to the market and protection that it covers during the crisis.

Originality/value

This paper provides a shred of unique evidence of the impact of the existence of external assurance and the type of assurer on the disclosure of COVID-related information in CSR reports. To the best of authors’ knowledge, no study has yet investigated the corporate disclosure on an unforeseen event in CSR reports and the role of CSR assurance in this respect.

Details

International Journal of Accounting & Information Management, vol. 29 no. 3
Type: Research Article
ISSN: 1834-7649

Keywords

Article
Publication date: 18 April 2023

Rekha Sharma

The purpose of this study is to discern the impacts of the hospitality industry on the global ecosystem and how sustainable learning can help strengthen the tourism and…

Abstract

Purpose

The purpose of this study is to discern the impacts of the hospitality industry on the global ecosystem and how sustainable learning can help strengthen the tourism and hospitality industry globally. Deployment of strategies such as change management is required, and in so doing, this is likely to have an impact on economic gain, society and the environment.

Design/methodology/approach

This is an exploratory study based on secondary data drawn from relevant books, articles, journals and online sources. The opinions of the key stakeholders are compiled and discussed to provide further guidance.

Findings

The results show that although there is a lot of variance in the information that hotel chains publicly disclose about their sustainability commitments and accomplishments, they are committed to a wide variety of environmental, social and economic issues. It also points to indicators that the global hotel industry is currently pursuing “weak” rather than “strong” practices of sustainability and that efficiency gains are framed within existing business models that focus on continued growth.

Practical implications

The study provides guidance for global hospitality chains given that they are well positioned to play a leading role in promoting sustainability. Yet more can be done to broaden sustainability and reporting in the context of an external assurance framework. The study should also be helpful to hospitality managers, students and academics with an interest in hospitality industry sustainable practices.

Originality/value

The study explores the challenges that industry faces in ensuring sustainability is embedded in all aspects of learning and in equipping sustainability-sensitive individuals to make a difference.

Details

Worldwide Hospitality and Tourism Themes, vol. 15 no. 3
Type: Research Article
ISSN: 1755-4217

Keywords

Article
Publication date: 6 August 2018

Chengzhi Long and Jing Lin

Though enormous research studies were conducted on corporate environmental responsibility (CER), few of them could empirically justify how CER helps to improve firm’s competitive…

1136

Abstract

Purpose

Though enormous research studies were conducted on corporate environmental responsibility (CER), few of them could empirically justify how CER helps to improve firm’s competitive advantage and firms are still hesitant to incorporate CER with their business strategy at present. The purpose of this paper is to theoretically and empirically explore how the CER strategy could help the firm to gain competitive advantage in Chinese context, particularly in terms of achieving brand sustainability (BS).

Design/methodology/approach

In this study, 310 listed companies in China were chosen as research sample. First, the CER strategies were classified into developing eco-friendly products, adopting EMAS or other eco-management, enhancing the impact of CER through value chain and charitable CER. Second, BS is constructed as two dimensions, i.e. resource-acquisition and consumer impact. Accordingly, this paper analyzed the relationship between CER and BS with regression model analysis, taking account of several moderating and control variables.

Findings

The results indicate that CER strategies have positive effect on BS. Among all CER strategies, developing eco-friendly products and charitable CER undertakings are the most effective ones to promote BS performance. Also, the paper found that the length of time in adopting CER strategy moderates the effect of CER on BS. The empirical evidence proves that CER strategies could enhance the brand value in terms of BS and help the company to gain competitive advantage.

Research limitations/implications

First, most of our samples are of the state-owned enterprises, so our assumption might not be applicable to other types of business. Second, corporate social responsibility (CSR) communication is an important factor in the relation between CSR and corporate performance, but it is not taken into account in this study. Third, the difference in industries and ownership in this research is out of concern.

Practical implications

As this paper has provided empirical evidence to reveal the effectiveness of different CER strategies, firms in China could be more motivated to undertake CER not only for the sake of environment but also for their brand value and competitive advantage. More importantly, this paper could be a valuable reference for the firms in China to choose suitable and effective CER strategies, as proved in this study, to gain competitive advantage in the market.

Originality/value

At first, while public environmental awareness has improved gradually, we introduce the BS concept to explain how the CER strategies affect CCA. This approach gives us another perspective to highlight the relationship between these two constructs. Second, we conducted our research from practical perspective to explore how to apply the CER undertakings as the company’s strategy. Third, we conducted our empirical research in Chinese context, which will enrich the theoretical CER and CSR literature.

Details

Nankai Business Review International, vol. 9 no. 3
Type: Research Article
ISSN: 2040-8749

Keywords

Article
Publication date: 14 September 2018

Muhammad Shakeel Sadiq Jajja, Muhammad Asif, Frank L. Montabon and Kamran Ali Chatha

The purpose of this paper is to use institutional theory to develop the constructs of institutional pressures for social compliance and argue for a positive relationship between…

1129

Abstract

Purpose

The purpose of this paper is to use institutional theory to develop the constructs of institutional pressures for social compliance and argue for a positive relationship between institutional pressures and Supplier Social Compliance Management System (SSCMS). Moreover, the authors theorize that the impact of institutional pressures on SSCMS is moderated by the supplier’s organizational culture. This is done in a particularly salient context, which is apparel manufacturing in a developing country.

Design/methodology/approach

The hypothesized model is tested using data of 164 suppliers from the apparel manufacturing sector. PLS-based structural equation modeling is used to test the direct and multi-group moderation hypotheses.

Findings

Empirical examination provides evidence that institutional pressures have a positive impact on supplier social compliance and the types of organizational culture have varied moderation effects.

Research limitations/implications

This research is based on cross-sectional data from one industry. Future research should collect data from diverse sectors in different countries.

Practical implications

The findings suggest that consistent pressures from various stakeholders can increase supplier social compliance. In addition, the partial evidence for moderation effect of organizational culture indicates that supplier’s internal value system’s alignment with social compliance pressures plays an important role in determining how supplier acts on social compliance initiatives.

Originality/value

The issue of suppliers’ adoption of social compliance management systems has become prominent as a consequence of the shifting of manufacturing to developing countries. However, comprehensive frameworks explaining antecedents of adoption of SSCMS using large-scale empirical data are limited. In addition, findings on the relationship between supplier social sustainability practices and their antecedents are inconsistent.

Details

International Journal of Physical Distribution & Logistics Management, vol. 49 no. 5
Type: Research Article
ISSN: 0960-0035

Keywords

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