Exploring the factors and effects of Corporate Social Responsibility Disclosure in Saudi Arabia (in the area of accounting and finance)

• Main Author: Alhazmi, Anas
• Published: Nottingham Trent University 2017
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.728851

CSR (Corporate Social Responsibility) has attracted widespread attention in recent years a matter that has led international efforts to provide global standards and guidelines for reporting on CSR issues. The objective of the current research study is to explore whether corporate governance and firm-specific factors would influence CSRD (Corporate Social Responsibility Disclosure) practices in Saudi Arabia, and whether CSRD practices have effects on firms' market value. The research study data was collected using a content analysis method and measured CSRD by word count. The data analysis was conducted using econometrics regression models based on a sample of unbalanced panel of 545 annual reports over a five-year period. The findings provided evidence of CSR engagement and improvement over the period of the study among Saudi listed firms. In terms of factors, the study found that ownership structure, firm size, environmental sensitivity and firm age had a significant influence on CSRD practices. Finally, CSRD practices had a significant positive benefit on firm value in terms of the aggregated level of CSRD generally and Saudization specifically. These findings provide policy-makers (for example, the Saudi government) with an understanding of how firms adopt CSR issues, thus helping to improve policy formulation. In terms of the literature, the current research study extends the limited CSRD literature in developing countries in general and Saudi Arabia in particular where there is a dearth of studies that examined the relationship between CSRD practices and corporate governance factors. Further, the current research study contributes to the literature by examining the benefits of CSRD practices, an area that lacks empirical investigations in both developed and developing countries.