CORPORATE SOCIAL RESPONSIBILITY, CORPORATE REPUTATION, AND SHARE PRICE: A STUDY OF CONSUMER GOODS INDUSTRIES USING SUSTAINABLE ACCOUNTING STANDARD BOARD (SASB) DISCLOSURES

Juniati Gunawan, Hermawan Susilo

Abstract


This study aims to seek theㅤinfluenceㅤof corporateㅤsocialㅤresponsibilityㅤdisclosures (CSRD) on share prices with the company's reputation as intervening variable. The samples are derived from all of the consumer goods industries, which areㅤlistedㅤonㅤIndonesiaㅤStockㅤExchange during 2014-2018. Content analysis method is used to measure the company’s corporate social responsibility disclosures based on company’s annual reports and/or sustainability reports. Unlike previous studies, this research applies the Sustainability Accounting Standard Board (SASB) as the disclosures list to award the scores. Panel regression method and Eviews 9 were applied as analytical tools. Findings shows that CSRD does not influence the corporate reputation, but in contrast, CSRD influence significantly and positively to the share prices, and so does the corporate reputation. However, CSRD does not influence the share prices when it is mediated by the corporate reputation as intervening variable. When CSRD and Reputation were examined together, controlled by ROA, these variables positive significantly influence the corporate share price.  


Keywords


Corporate social responsibility disclosures; Corporate reputation; Share price, Consumer good industries, Sustainability Accounting Standard Board (SASB)

Full Text:

PDF

Article Metrics

Abstract views : 0| PDF views : 0

References


Abdullah, Z., & Abdul Aziz, Y. (2013). Institutionalizing corporate social responsibility: effects on corporate reputation, culture, and legitimacy in Malaysia. Social Responsibility Journal, 9(3), 344–361.

Ali, I., Lodhia, S. and Narayan, A.K. (2020). Value creation attempts via photographs in sustainability reporting: a legitimacy theory perspective. Meditari Accountancy Research. Vol. ahead-of-print, No. ahead-of-print.

Axjonow, A., Ernstberger, J., & Pott, C. (2018). The Impact of Corporate Social Responsibility Disclosure on Corporate Reputation: A Non-professional Stakeholder Perspective. Journal of Business Ethics, 151(2), 429–450.

Bhattacharyya, A,. (2016). Corporate Social and Environmental Responsibility in an Emerging Economy: Through the Lens of Legitimacy Theory. Australasian Accounting, Business and Finance Journal, 9(2), 79-92.

Bellantuono, N.; Pontrandolfo, P.; Scozzi, B. (2016). Capturing the Stakeholders’ View in Sustainability Reporting: A Novel Approach. Sustainability, 8, 379.

Brown, N. and Deegan, C. (1998). “The public disclosure of environmental performance information – a dual test of media agenda setting theory and legitimacy theory”. Accounting & Business Research, Vol. 29, No. 1, pp. 21-42.

Cordeiro, J.J., Tewari, M. (2015). Firm Characteristics, Industry Context, and Investor Reactions to Environmental CSR: A Stakeholder Theory Approach. J Bus Ethics 130, 833–849.

Dayuan Li, Mi Zheng, Cuicui Cao, Xiaohong Chen, Shenggang Ren, Min Huang. (2017). The impact of legitimacy pressure and corporate profitability on green innovation: Evidence from China top 100. Journal of Cleaner Production, 141, 41-49,

De Klerk, M., de Villiers, C., & van Staden, C. (2015). The influence of corporate social responsibility disclosure on share prices: Evidence from the United Kingdom. Pacific Accounting Review, 27(2), 208–228.

Deegan, C. M. (2019). Legitimacy theory: Despite its enduring popularity and contribution, time is right for a necessary makeover. Accounting, Auditing and Accountability Journal, 32(8), 2307–2329.

Deegan C. (2002). Introduction: the legitimacy effect of social and environmental disclosure-a theoretical foundation. Accounting, auditing & Accountability Journal, 15(3): 282- 311

Freudenreich, B., Lüdeke-Freund, F. & Schaltegger, S. (2020). A Stakeholder Theory Perspective on Business Models: Value Creation for Sustainability. J Bus Ethics 166, 3–18.

Frynas, G., Yamahaki, C. (2016). Corporate social responsibility: review and raodmap of theoretical perspectives. Business Ethics, the Environment & Responsibility, 25(3), 258-285.

Gunawan, J. (2007). Corporate social disclosures by Indonesian listed companies: A pilot study. Social Responsibility Journal, 3(3), 26–34.

Gunawan, J. (2015). Corporate social disclosures in Indonesia: Stakeholders’ influence and motivation. Social Responsibility Journal, 11(3), 535–552.

Gunawan, J. (2018). Tanggung jawab sosial, lingkungan dan reputasi perusahaan: pengungkapan pada situs bank. Media Riset Akuntansi, Auditing & Informasi, 18(1), 49.

Guthrie, J., Parker, L. (1989). Corporate social reporting: A Rebuttal of Legitimacy Theory. Accounting and Business Research, 19 (76).

Hummel, K., Schlick, C. (2016). The relationship between sustainability performance and sustainability disclosure – Reconciling voluntary disclosure theory and legitimacy theory. Journal of Accounting and Public Policy, 25(5), 455-476.

Ismaeel, M., & Zakaria, Z. (2019). Perception of preparers of sustainability reports in the Middle East: Contrasting between local and global. Meditari Accountancy Research, 28(1), 89-116.

Isnalita., Narsa, I.M., (2017). CSR Disclosure, Customer Loyalty, and Firm Values (Study at Mining Company Listed in Indonesia Stock Exchange). Asian Journal of Accounting Research, 2 (2). 8-14.

Jebe, R. (2019). The Convergence of Financial and ESG Materiality: Taking Sustainability Mainstream. American Business Law Journal, 56(3), 645-702.

Love, E.G., Lim, J., Bednar, M.K. (2016). The face of the firm: the influence of CEOs on Corporate Reputation. Academy of Management Journal, 60(4), 1462-1481.

Khoerudin, Hermawan, D., & Purnamasari, I. (2017). External coordination of traffic and transportation agency about implementation of one way direction system in Bogor city. Jurnal Governansi, 3(2), 63–70.

Lee, S., & Jung, H. (2016). The effects of corporate social responsibility on profitability: The moderating roles of differentiation and outside investment. Management Decision, 54(6), 1383–1406.

Lenka, U., Tiwari, B. (2016). Achieving triple “P” bottom line through resonant leadership: an Indian perspective. International Journal of Productivity and Performance Management, 65(5), 694–703.

Miles, S. (2017). Stakeholder Theory Classification: A Theoretical and Empirical Evaluation of Definitions. J Bus Ethics 142, 437–459.

Miller, S.R., Eden, L. & Li, D. (2020). CSR Reputation and Firm Performance: A Dynamic Approach. J Bus Ethics 163, 619–636.

Omran, A. M., Ramdhony, D. (2015). Theoretical Perspectives on Corporate Social Responsibility Disclosure: A Critical Review. International Journal of Accounting and Financial Reporting, 5(2), 38-55.

Park, S. H. (2017). Corporate social responsibility, visibility, reputation and financial performance: empirical analysis on the moderating and mediating variables from Korea. Social Responsibility Journal, 13(4), 856–871.

Pérez, A. (2015), "Corporate reputation and CSR reporting to stakeholders: Gaps in the literature and future lines of research", Corporate Communications: An International Journal, 20 (1), 11-29.

Singh, S., Mittal, S. (2019). Analysis of drivers of CSR practices’ implementation among family firms in India: A stakeholder’s perspective. International Journal of Organizational Analysis, 27(4), 947–971.

Stewart, R., Niero, M. (2018). Circular economy in corporate sustainability strategies: A review of corporate sustainability reports in the fast-moving consumer goods sector. Business Strategy and the Environment, 27(7), 1005-1022.

Thorne, L., Mahoney, L. S., & Manetti, G. (2014). Motivations for issuing standalone CSR reports: A survey of Canadian firms. Accounting, Auditing and Accountability Journal, 27(4), 686–714.

Verbeeten, F. H. M., Gamerschlag, R., & Möller, K. (2016). Are CSR disclosures relevant for investors? Empirical evidence from Germany. Management Decision, 54(6), 1359–1382.

Vig, S., Dumicic, K., & Klopotan, I. (2017). The impact of reputation on corporate financial performance: Median regression approach. Business Systems Research, 8(2), 40–58.

Vigneau, L., Humphreys, M., & Moon, J. (2015). How Do Firms Comply with International Sustainability Standards? Processes and Consequences of Adopting the Global Reporting Initiative. Journal of Business Ethics, 131(2), 469–486.

Vlastelica, T., Kostic, S. C., Okanovic, M., & Milosavljevic, M. (2018). How corporate social responsibility affects corporate reputation: Evidence from an emerging market. Journal of East European Management Studies, 23(1), 10–29.

Wei Yu-Chen, Lu Yang-Cheng, Chen Jen-Nan, & Wang Dan-Leng (2018). The Impact of Media Reputation on Stock Market and Financial Performance of Corporate Social Responsibility Winner. NTU Management Theory Series, 28(1), 87-140.

https://www.weforum.org/reports/the-global-risks-report-2020.

https://www.ojk.go.id/sustainable-finance/id/publikasi/riset-dan-statistik/Pages/Sustainability-Report-bagi-Lembaga-Jasa-Keuangan-dan-Emiten.aspx.




DOI: http://dx.doi.org/10.25105/jmat.v8i1.8770

Refbacks

  • There are currently no refbacks.


Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.