Author

S.Chen, P.Bouvain.

Date

May 2009

Region/Country

US/UK/ Australia/Germany

Description

This study aims to move beyond the superficiality of previous analyses of CSR reports by using textual analysis software and a more robust statistical method to more objectively and reliably compare the CSR reports of firms in different industries and countries.
The sample comprises leading companies (based on national stock market indices) from the US, UK, Australia and Germany. The analysis examines whether or not membership of the Global Compact makes a difference to CSR reporting and is overcoming industry and country specific factors that limit standardization.
Businesses from different countries differ significantly in the extent to which they promote CSR and the CSR issues they choose to emphasise in their reports.

Key findings

• In US company reports, a relatively high importance is placed on community and employee-related issues.
• In UK company reports employee and community-related issues remain significant, but are related to health and safety issues.
• The UK, which has a strong consumer awareness of ethical sourcing issues, displays much greater emphasis on customer and supplier-related issues in their CSR reports.
• In Australian company reports communities are discussed in connection with customers.
• German company reports are shown to be quite clearly distinct from US, UK, and Australian company reports. While employees remain central, there is a much clearer emphasis on social and environmental issues.
• In an examination of the relative importance (as measured by frequency of mention in the CSR reports) of each of the six areas of CSR (workers, customers, suppliers, community, environment, and society), countries showed significant differences in the mention of society, community, and customer issues.
• There was some overlap in the use of the terms ‘social’ and ‘community’ with German companies preferring the use of the word ‘social’ while US, UK, and Australian companies preferring the use of the word ‘community’ to describe similar activities.
• However, the differences appear to be more than semantic. For instance, one issue that was discussed at length by several German companies, but rarely by companies in the other countries was political dialogue and actively participating in the political process in their home country to bring about social change.
• Another significant difference between countries was in the use of third-party assurance of CSR reports. Here the UK stood out clearly as the country where third-party assurance was most frequently used and the US as the country where third-party assurance was least frequently used.
• There were few significant differences among industries. Industry made a significant difference only to frequency of mention of the environment.
• Multinationality of the company also had a significant effect on mention of the environment.
• Global Compact membership was shown to make a significant difference in mention of environmental and worker-related issues but not for mention of society, community, suppliers, and customer issues.
• Global Compact membership was also shown to have a significant effect on the inclusion of measured CSR performance statistics in the report.

More information

Journal of Business Ethics (2009), 87, 299-317