Corporate Social Disclosure Characteristics and the Role of Ethical Investment Trusts

Lorne S. Cummings, Roger L. Burritt

Research output: Contribution to journalReview articleResearchpeer-review

Abstract

To attract funding from ethical investment trusts, it is expected that investee companies will need to undertake corporate social disclosure (CSD) in annual reports. This paper first explores the notion that companies included within the portfolio of ethical investment trusts (ETIs), are likely to provide a greater quantity of CSD than companies in which ethical trusts have not invested (NETIs). Second, the paper examines the characteristics of companies that undertake CSD, and their relationship to the ETI/NETI classification. Results from the examination of a sample of 300 Australian annual reports for 147 companies over a five-year period (1990–1994), indicate that CSD is related to size, industry visibility, and company presence in both foreign countries and foreign stock exchanges. The significance of this paper, in addition to building upon empirical research into CSD, is that, in a range of circumstances, companies with an ethical investor as a shareholder, provide greater transparency about their social and environmental activities, than companies without an ethical investor. As a result, case can be made for the direct regulation and monitoring of ETI companies to be reduced, relative to NETIs, given that ethical investment may fulfil a market based regulatory function.

LanguageEnglish
Pages20-42
Number of pages23
JournalAsian Review of Accounting
Volume7
Issue number1
DOIs
Publication statusPublished - 1 Jan 1999

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Ethical investment
Disclosure
Investment trusts
Annual reports
Investors
Shareholders
Transparency
Stock exchange
Empirical research
Monitoring
Visibility
Funding
Industry

Cite this

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Corporate Social Disclosure Characteristics and the Role of Ethical Investment Trusts. / Cummings, Lorne S.; Burritt, Roger L.

In: Asian Review of Accounting, Vol. 7, No. 1, 01.01.1999, p. 20-42.

Research output: Contribution to journalReview articleResearchpeer-review

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