Author:Mamun, Mohammed Abdullah


Corporate social responsibility (CSR) has swept across the world and has become one of the buzzwords of the new millennium (Pedersen, 2006). Over the last few decades, corporate social responsibility (CSR) has received a large amount of attention in research and in practice. Evidences from empirical studies indicate that consumers are influenced by CSR initiatives by businesses, when they are aware of CSR communications. As a response to the growing awareness of and concern about social and environmental issues, an increasing number of companies are proactively publishing their CSR-related principles and activities (Kilian and Hennigs, 2014). Along with the public's increased demand for businesses to actually operate responsibly, stakeholders want to be informed about what companies do right and what they do wrong (Kilian and Hennigs, 2014). Because, in recent times, corporations have been pressured by non-governmental organizations (NGOs), activists, communities, governments, media and other institutional forces. These groups demand what they consider to responsible corporate practices (Garriga and Mele, 2004).

Corporate social responsibility in Malaysia was formally instituted by several companies in the 1970s. At the turn of the century, it expanded along lines similar to the CSR movements in other Asian countries (Ismail, Alias and Rasdi, 2015). In fact, the number of companies reporting increased dramatically in 2006, almost doubling the number of reports produced in previous years. This growth is attributed to increasing government and regulatory involvement, heightened awareness of sustainability concerns amongst local media and civil society, and the private sector becoming more engaged with corporate responsibility (Lopez, 2010). Among the ASEAN countries, Malaysia showed remarkable progress in sustainability reporting due to the increase of government and regulatory requirements in this case. Within the five ASEAN countries surveyed, Malaysia has the distinction of having the highest number of reporters with a total of forty-nine companies overall producing ninety-seven Sustainability Reports in the past eight years (Lopez, 2010).

This research examines the disclosure of the Malaysian business organization to describe its CSR activities as strategic philanthropy responsibility towards the stakeholder of the company.

First section, follows the introduction, is the reviewing the literature to find the issue of this research to understand the disclosure requirements and quality of the same. Second, methodology of the research gives the nature of sample companies of which sustainability reports are used for analysis and also the models of the analysis. Third, CSR reporting practice of the sample Malaysian business has been analyzed to examine its quality of disclosure. Finally, the research recommends the future research direction from the concluding remark.


Despite the decades-old focus of CSR on business research, the environment and education, the relevant dimensions of CSR in the community is still unclear. It is argued that not much attention has been given to the characteristics of the CSR recipients, types of corporations involved, perceptions of participants to the orientations of CSR and the types of provisions extended to the community (Ismail, et. al., 2015).

Many business firms choose a CSR agenda that conforms to the traditional approach by selecting projects and meeting social obligations and objectives irrespective of firm interest. Projects are approved because there is a budget for them. Should there be competitive benefits, they are simply the result of doing good things. In contrast, a strategic approach to corporate social activity, as opposed to simply doing well by doing well, requires that companies create and implement social projects that seek competitive advantage and economic value (Husted, Allen and Kock, 2015).

How companies attempt to position CSR in their own organizational structure and reflect it in their own norms and values has received relatively little attention until now. Here it is assumed that every company needs to give its own individual meaning to the concept of CSR, 'with current and emerging values, acting as brakes, gearboxes or accelerators (Cramer, Van Der Heijden & Jonkere, 2006).

The opportunity for companies' gaining competitive advantage from environmental management systems and other pollution prevention activities increasingly depends on their ability to communicate attitudes and performance to stakeholders. The publication of an index of corporate environmental disclosures on the internet could enforce the reputation mechanism and provide a competitive advantage to companies that are actively fostering social and ecological values. This would provide other companies with a strong incentive to integrate corporate social responsibility into their strategies (Bolivar, 2009).

The two distinct phases of CSR integration into an organization which can be earmarked are- successful adoption and implementation of CSR, and effective communication of the same to the respective stakeholders (Tewari and Dave, 2012). Following the rising social and environmental challenges around the world, the increasing trend of CSR reporting has been apparent. CSR Asia, an advocate of sustainable economic, social and environmental development across the Asia Pacific region, reports on ten major social and environmental issues: labor and human resources, corporate governance, environmental issues, climate change, partnerships with stakeholders, regulation and leadership from governments, bribery and corruption, community investment and pro-poor development, product responsibility and the professionalization of CSR (Zainal, Zulkifli and Saleh, 2013).

There is no clear legislative control for CSR reporting in many countries around the world, especially in the Asia-Pacific region. However, concerns relating to the extent and quality of disclosures have led to calls for the introduction of mandatory reporting requirements. The introduction of a number of international standards and global benchmarks has answered some of these reservations and provided a timely interface between voluntary and compulsory disclosure regimes (Jain, Keneley and Thompson 2015).

CSR disclosure is referred to as "a public report by companies to provide internal and external stakeholders with a picture of the corporate position and activities on economic, environmental and social dimensions" (Giannarakis and Grigoris, 2014). Social Reporting is one of the branches of Social Accounting as such firms will use communication mediums such as annual reports, social reports, promotional material, and web sites, to report their CSR activities. These reports are important to other users (such as employees, consumers, community, government and NGOs,) other than solely for financial analysts and fund managers (Zakimi and Atan, 2011). However, the extent of CSR information appearing in the annual report is varied over time, regions and countries economic development status. A number of researchers emphasized that business is under pressure from their stakeholders to report its social activities because these parties want to protect their long-term interests in the firms (Zakimi and Atan, 2011).

Of the various forms of CSR communication the most recent one is the use of sustainability report. They have evolved over a decade and have had various nomenclatures attached to them ranging from corporate social responsibility report, global citizenship report or sustainability report. But irrespective of the name under which these reports are released, provides a platform for firms to demonstrate to people at large the positive responsible corporate citizenship (Tewari and Dave, 2012).

Sustainability reports or social reports are released by the companies for the stakeholders and present the sustainability accountability of the corporate. Sustainable development reports have been defined by The World Business Council for Sustainable Development (WBCSB) as 'public reports by companies to provide internal and external stakeholders with a picture of corporate position on activities on economic, environmental and social dimensions'. Sustainability Accountability has emerged for a period of time and has its roots both in philosophical accounting discussion and developments in accounting. There is a mixed pattern in the release of sustainability reports because certain organizations include the sustainable report as a section in their annual reports while others release it as a separate report (Tewari and Dave, 2012).

The sustainability reports unlike the annual reports, websites and press releases have a more structured format of reporting with guidelines, templates and ranking provided by several international agencies like Global Reporting Initiatives (GRI), Global Compact, CSR Assessment Tool, Conference Board of Canada in partnership with Imagine, CSR Insight TM Five Winds International, etc., of which GRI is the most popular one (Tewari and Dave, 2012).

Another example that supports the changing on corporate social behaviors is a study undertaken by the US magazine Fortune of the Fortune 500 companies in 1977 and 1990. In 1977 less than half of these companies embraced CSR as an essential component in their annual reports. However, at the end of 1990, it was discovered that nearly 90 percent of the Fortune 500 companies listed CSR as one of the basic elements of their organizational goals, actively reporting the CSR events held by these corporations in their annual reports (Moura Leite and Padgett, 2011).

A variety of models or frameworks such as the GRI, the ISO 14001 (Internationally Standards Organization), and the 2000 World Resources Institute (WRI) for reporting on corporate social responsibility are nowadays in place to report a corporation's social responsibility...

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