“The Influence of Culture on Corporate Governance and Ownership Structure in Determining CSR Disclosures: A Cross Country Analysis” by Professor Chris van Staden
Professor Chris van Staden
Professor of Accounting
AUT Business School
Auckland University of Technology
This paper has two objectives. The first is to investigate the effects of national culture, corporate governance and ownership structure on CSR reporting. The second is to examine if corporate governance and ownership moderates cultural influences on CSR reporting.
A total of 403 annual reports, corporate websites and CSR stand-alone reports of 203 companies in China, Malaysia, India and the UK was evaluated using a comprehensive checklist while cultural factors were based on country level indicators.
The results show CSR reporting is more prominent for companies in countries in which the society is individualistic and societies with low power distance. CSR reporting is enhanced by corporate governance in the form of CSR board committees and government ownership influences CSR reporting quality. Furthermore, corporate governance moderates some of the detrimental cultural influences on CSR reporting.
These findings have implications for implementing guidelines for CSR reporting (for example GRI guidelines) across countries in that culture will influence the application of these guidelines in practice, often detrimentally, while good corporate governance, could mitigate the cultural effects.
This study contributes to the literature by showing that corporate governance factors, and specifically a CSR committee, improves the quality and quantity of CSR reporting while government ownership improves the quality of CSR reporting. Furthermore, corporate governance has a moderating effect on some of the cultural influences and for example limited the negative effect of large power distance.