Disclosures of corporate political donations: an Australian evidence

Edward Tello Melendez, James Hazelton

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Motivated by the controversy surrounding corporate lobbying and corporate political donations, this study considers voluntary Australian corporate political donation disclosures. The frequency, quality, location and motivation of disclosures are investigated from a Legitimacy Theory perspective. While Australian corporations must disclose political donations to the Australian Electoral Commission (AEC) annually, they are not compelled to disclose this information in either annual reports, or stand-alone reports, or websites. Voluntary disclosures of a sample comprising 164 companies which donated $40,000 or more during the fiscal years 2004, 2005 and 2006 were analysed. In addition, the disclosure practices of all companies within the ASX top 50 were investigated. For the donor companies, findings were low frequency and quality of voluntary political donation disclosures. Most disclosures were made in annual reports. Evidence supporting Legitimacy theory, is mixed. While the narrative of disclosures and industry characteristics of disclosing companies were consistent with the theory, the lack of disclosure overall suggested that voluntary disclosures of corporate political donations were not a prevalent legitimating device. For the ASX top 50, higher proportions of disclosures were observed. Interestingly, however, for 2004 and 2005, more companies who did not make political donations disclosed this fact compared to donor companies. This suggests that donations may not be considered ‘good news’ by companies.
Original languageEnglish
Title of host publicationCritical Perspectives on Accounting
Subtitle of host publicationan international conference at Baruch College April 25-26, 2008
EditorsTony Tinker
Place of PublicationNew York
PublisherCity University of New York
Number of pages33
Publication statusPublished - 2008
EventCritical Perspectives on Accounting Conference - New York
Duration: 24 Apr 200828 Apr 2008


ConferenceCritical Perspectives on Accounting Conference
CityNew York


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