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Abstract:

This article investigates the determinants of disclosure on corporate social responsibility (CSR) on the corporate websites of listed Western European companies. In order to measure the amount of CSR-disclosure a checklist is composed based on the Global Reporting Initiative (GRI) standard. The results indicate that larger firms disclose more information on CSR. This is in line with larger firms having more stakeholders and higher visibility, thus raising public pressure to behave responsibly. Second, less profitable firms exhibit lower CSR-disclosure indicating a focus on activities with a more direct impact on profits when resources are limited. Third, firms in polluting sectors disclose more CSR-information in order to anticipate environmental claims. Fourth, firms with more dispersed shareholders tend to disclose more information on CSR consistent with the fact that they need to maintain a positive image since they depend more on external markets. Fifth, firms located in countries with less developed financial markets disclose less information on CSR, suggesting that they face less pressure to report CSR-information. Overall, results seem to indicate that the amount of CSR-disclosure tends to be triggered by pressure from the outside world rather than being a voluntary decision of the firm.