Online Corporate Environmental Reporting: Improvements and Innovation to Enhance Stakeholder Value

Corporate environmental/sustainability reporting is a growing trend among top global companies. In many cases, these reports have been made available online. Although the internet has provided reporting companies with a new channel to convey environmental information to the public, effective use of this media requires careful thought.Usability is a primary consideration that is not being addressed in many online corporate environmental/sustainability reports (CER). Often, these reports are difficult for users to locate from the corporate homepage, the search option does not render the correct page, some are only available in PDF format, and navigation within the report can be difficult. Current online reporting can also be ineffective if the technology is not oriented towards a framework of maximizing stakeholder value.If approached properly, internet technology allows for interactivity between a company and its stakeholders, provision of real-time updates of information and specialized information retrieval depending on the needs of users. This paper focuses on the current state of online CER reporting and suggests methods and practices for enhancing stakeholder value.     

利益相关者关系与企业财务绩效的实证研究——基于中国房地产上市公司的面板数据分析

本文采用2002-2008年中国26家房地产上市公司的面板数据,通过面板数据单位根检验、协整检验和误差修正模型,对利益相关者关系与企业财务绩效之间的长期和短期关系进行了实证研究。研究结果表明:利益相关者关系与企业财务绩效之间存在长期和短期均衡关系,企业应在不同时期对各利益相关者采取差异化管理策略,满足他们各自的利益需求,与利益相关者建立良好的关系,这是提升企业财务绩效的关键。     

The financial crisis,investor activists and corporate strategy: will this mean shareholders in the boardroom?

The concept of stakeholder engagement is gaining increasing attention in the mainstream media and may feature as part of a corporation’s strategy for corporate social responsibility. Not only are boards considering how they might engage with key stakeholders, but stakeholders are also pursuing greater participation in the strategic decisions of companies in which they invest. While this is an emerging concept in companies governed by unitary boards, as in North America, the issue of stakeholder engagement in various forms is also entering debate in other countries around the world. In general, however, the idea of shareholder or stakeholder representation on the boards of most UK and Commonwealth companies is anathema. Forces now influencing the development of strategies for stakeholder engagement and the rise of active investors include changing corporate governance rules which give investors more power in the election of directors, the increasing role of pension plans and hedge fund investment groups which have produced investors who keep a close eye on company performance and value, and a sluggish or turbulent stock market as a result of the financial crisis initiated by the credit crunch in the sub-prime mortgage markets. In this paper the phenomenon of stakeholder representation is examined and results of a recent survey conducted among a large sample of New Zealand directors are presented. The findings suggest that these traditionally oriented boards are increasingly inwardly focused and are without an agenda for building and managing shareholder and stakeholder relations. Accordingly, such boards are unlikely to regard stakeholder engagement as a serious strategic issue and are thus also likely to miss significant opportunities in the changed business environment to benefit from stakeholder support.     

How organizational logics shape trade-off decision-making in sustainability

Tensions between economic, environmental, and social performance are inherent to the practice of corporate sustainability. These sustainability tensions present the company with strategic choices. Using an organizational cognition perspective, we posit that companies interpret and respond to these tensions in ways that reflect an underlying collective sustainability logic. The purpose of this research is to explore this link, and to describe the logics that companies use when approaching sustainability tensions—and in doing so, explore what this reveals about the nature of the logics themselves. To achieve this, we perform a qualitative content analysis of interviews with sustainability managers, as well as archival documents. We find that all companies, regardless of their sustainability logic, encounter tensions in the practice of sustainability. In navigating these tensions, companies following a market-led logic tended to consider a narrow scope of stakeholder interests in their sustainability decision-making. These companies also followed a mutually-exclusive (and unintegrated) ‘if/then’ approach to sustainability tensions. On the other hand, companies that followed a holistic logic tended to consider a much wider scope of stakeholders and displayed a higher degree of integration in their logic (i.e., synergetic approach to decision-making around tensions).     

The Challenges of Socially Responsible Investment Among Institutional Investors: Exploring the Links Between Corporate Pension Funds and Corporate Governance

During the last few decades, globalization of finance markets has come under increasing pressure to manage the many risks that companies face due to the negative impact that certain financial crises have had on securities quoted on the stock exchange. Simultaneously, there is a growing tendency among different institutional investors to take into account nonfinancial aspects—social, environmental, and ethical values—of company management. In this respect, increasing numbers of asset managers are aware of the importance of nonfinancial aspects of company management for finance markets. Asset managers integrate corporate social responsibility, sustainability policies and corporate governance strategies as indicators in risk management and the search for long‐term investments. The largest segment of socially responsible investment (SRI) screened and mutual funds are portfolios that are privately managed on behalf of institutions. Socially responsible investors include private and public pension funds, mutual funds, and private accounts that are managed on behalf of institutional investors such as corporations, universities, hospitals, religious institutions, and nonprofit organizations, among others. The aim of this paper is to analyze the development of SRI‐screened management corporate pension plans in the Spanish finance market. Spain is one of the European countries with a less developed SRI institutional market. Since SRI is still at the fledgling stage in the Spanish institutional market, this analysis is restricted to the awareness of SRI among a sample of the total number of corporate pension funds or schemes in Spain. The paper concludes with some proposals to encourage wider SRI acceptance and practice in Spain.     

基于社会网络视角的企业社会责任行为相似性研究

本文利用国泰安数据库和锐思数据库中2010年-2012年的我国上市公司管理层数据、公司财务数据,以及润灵环球责任评级2010年-2012年我国A股上市公司的企业社会责任评级数据,从社会网络的角度出发,探索我国上市公司社会责任履行行为的相似性。研究结果发现,公司之间存在的社会网络会造成企业社会责任履行行为具有一定的相似性。当企业越是处于核心地位,越是容易传播信息,控制能力越强的时候,该公司同与之相关联的公司在社会责任履行行为方面越是具有相似性。这一结论为改善我国企业社会责任履行现状提供了一个全新的思考方向。     

Maximizing Business Returns to Corporate Social Responsibility (CSR): The Role of CSR Communication

By engaging in corporate social responsibility (CSR) activities, companies can not only generate favorable stakeholder attitudes and better support behaviors (e.g. purchase, seeking employment, investing in the company), but also, over the long run, build corporate image, strengthen stakeholder–company relationships, and enhance stakeholders' advocacy behaviors. However, stakeholders' low awareness of and unfavorable attributions towards companies' CSR activities remain critical impediments in companies' attempts to maximize business benefits from their CSR activities, highlighting a need for companies to communicate CSR more effectively to stakeholders. In light of these challenges, a conceptual framework of CSR communication is presented and its different aspects are analyzed, from message content and communication channels to company- and stakeholder-specific factors that influence the effectiveness of CSR communication.     

The Social Dimensions of Business Excellence

In an era of dynamic markets, globalisation, telecommunication and volatile stock markets, the board of directors of listed companies have grown familiar with the pressure of shareholders. Nowadays CEO's discus corporate responsible behaviour and sustainability more often. They feel the pressure of external stakeholders. They are aware of the increasing vulnerability of their corporate reputation, an increasing number of financial institutions start demanding social and environmental criteria — and it is more and more difficult to attract new talented people and at the same time, keeping existing employees satisfied. These developments make companies aware of the social dimensions of their organisation, their corporate identity, their role within society and their duty towards future generations.The business environment is beginning to accept that prosperity, profitability and shareholder value alone do not represent the value of the company. The companies’ ability to grow and to improve continuously is also determined by its social competences, ethical responsibility and environmental contributions. This shift of focus leads to a reorientation of the concept of business excellence. At first, quality management focused on the quality improvement of products and services, later on the processes providing these products. Quality was renamed into business excellence when corporations oriented themselves on the quality of the organisation and the chain (or network or hub) in which it operates. With the present challenges at hand, companies are beginning to focus on the quality of society while taking care of their core businesses, an objective that transcends and includes the former quality orientations.This article first introduces the European Business Excellence Model (EFQM model), which have facilitated the transformation toward an integral management approach, including openings to corporate social responsibility (CSR). We will than elaborate on the cultural context of companies engaged in CSR and social responsible investing (SRI) activities. We will end this article with an overview of CSR activities, structured according the EFQM model.     

Why ownership matters

The main argument of this article is that corporate planners have tended to concentrate on subjects such as control of business strategies, financial management and global economic assessment; they have paid too little attention to the ownership of corporate entities. Apart from the overwhelming economic and social arguments in favour of dispersed ownership, there is increasing evidence that companies which adopt a positive planning approach to the ownership of their business will derive wider benefits. Much more statistical and attitudinal evaluation is required; individual companies need to support the macro-work of academic research with detailed micro-studies at the company level. If these studies continue to support the basic argument, there are positive steps which each company will be able to take to support the cause of wider ownership.     

Corporate governance and management practices: stakeholder involvement, quality and sustainability tools adoption

Local public services are the field in which New Public Management (NPM) and Public Governance issues are most in evidence. The local public services are characterized by the rethinking of the role played by local government in the provision of services. An evolution has taken place. From a traditional configuration in which local public services were managed by local governments they moved to a configuration where a separation has taken place between the local government role (which continues to be the guarantor of the satisfaction of public needs) and the role of local public utilities (LPUs) (responsible for delivering the services). This transformation implies both the delegation of resources and authority to lower organisational levels within the public sector and the reconfiguration of accountability chains between the state institutions and the society. In recent years, an intense debate has developed regarding the introduction of new tools and control systems. Particular attention has been paid to planning and control systems, human resources management systems, and performance management systems, leaving a few pioneers to develop their analysis on corporate governance mechanisms with regard their relationships with both the external (stakeholders) actors and the internal (management) ones. On one hand, the OECD wrote guidelines in order to ensure good corporate governance practices, focusing on relations with stakeholders. On the other hand, the dialogue between corporate governance and stakeholders has been already tackled by a number of International organizations guidelines or principles, following a debate on corporate governance that has progressively combined a stakeholder perspective with a more classic shareholder-maximizing model of governance. This article contributes to the debate on the stakeholder involvement process. By means of both a theoretical discussion and an empirical research conducted on 37 Italian LPUs, this paper attempts to analyse specific management tools which can be used to improve the quality of corporate governance in LPUs, by extending the stakeholder involvement. Some NPM’s tools, such as quality standards and sustainability tools imply an effort to offer new forms of organizational behaviour in the decision-making processes (i.e. the choice of the performance indicators and the reporting tools) and to create a dialogue between the enterprise and its stakeholders. In particular, in our study we focus on the adoption of quality standards (ISO 9000 and Customer Satisfaction) and sustainability tools (sustainability reports and ISO 14000 standard) as NPM’s tools to facilitate the stakeholder involvement practices.     

An Integrated Approach for Modeling Sustainability Risks in Freight Transportation Systems

Integrating sustainability into freight transportation systems (FTSs) is a complex and challenging task due to the sheer number of inherent sustainability risks. Sustainability risks disrupt the economic, social and environmental objectives of freight operations and act as impediments in the development of sustainable freight transportation systems. The area of sustainability risk management is still unexplored and immature in the operational research domain. This study addresses these research gaps and contributes in a threefold manner. First, a total of 36 potential sustainability risks related to FTSs are identified and uniquely classified into seven categories using a rigourous approach. Second, the research proposes two prominent perspectives, namely, ontological and epistemological perspectives to understand risks and develops a novel framework for managing sustainability risks in FTSs. Third, a novel approach by integrating fuzzy evidential reasoning algorithm (FERA) with expected utility theory is developed to quantitatively model and profile sustainability risk for different risk preferences, namely, risk-averse, risk-neutral, and risk-taking scenarios. The proposed FERA is a flexible and robust approach, which transforms the experts’ inputs into belief structures and aggregates them using the evidence combination rule proposed in Dempster–Shafer theory to overcome the problem of imprecise results caused by average scoring in existing models. A sensitivity analysis is conducted to demonstrate the robustness of the proposed model. Unlike conventional perception, our study suggests that most of the high priority sustainability risks are behaviorally and socially induced rather than financially driven. The results provide significant managerial implications including a focus on skills development, and on social and behavioral dimensions while managing risks in FTSs.     

Corporate sustainability and risk

This study analyses the relationship between corporate sustainability and corporate risk. Different grades of sustainability are constructed from the inclusion of companies into sustainability indices and the number of years included. The grades are measured against variables of expected and unexpected risk and drivers of a sustainable company’s risk (sustainability risk). Based on the assumption that the level of sustainability impacts upon the dimension of risk, a sample of 167 European companies and different subsamples are assessed on available accounting data. However, the findings do not provide any clear evidence, suggesting that companies, once rated as sustainable, display similar patterns of risk and that a high degree of sustainability may be achieved without adverse impacts on risk and risk-adjusted return.     

Information security governance: pending legal responsibilities of non-executive boards

The study shows that a structural conflict of interest in non-executive boards exists due to missing corporate governance structures and a lack of awareness for legal issues with regard to information security risks. Non-executive boards receive information on strategic security threats as a part of their oversight function to fulfill investor interest in transparency. At the same time, they act as representatives of company stakeholders and have an interest to counteract to information security risks based on the stakeholder’s risk disposition. If not properly structured by corporate governance rules, these different interests may lead to regulatory aberrations on non-executive board level. The study analyses a Deutsche Telekom AG case where non-executive board members, employees, and journalists fell victim to a spying scandal subject to the German telecommunications secrecy law in 2005–2006. The analysis demonstrates how the handling of information security on non-executive board level bears governance risks as well as legal risks that are insufficiently addressed in corporate governance research. The paper contributes to avoid a reproduction of events in the future, by suggesting the principle of a segregation of duties on non-executive boards as well as providing an overview of relevant legislative requirements that clarify tasks of non-executive board members with regard to information security. The study therefore helps protecting corporations and their stakeholders from similar consequences of missing corporate security governance.     

The sweet spot in sustainability: a framework for corporate assessment in sugar manufacturing

The assessment of corporate sustainability has become an increasingly important topic, both within academia and in industry. For manufacturing companies to conform to their commitments to sustainable development, a standard and reliable measurement framework is required. There is, however, a lack of sector-specific and empirical research in many areas, including the sugar industry. This paper presents an empirically developed framework for the assessment of corporate sustainability within the Thai sugar industry. Multiple case studies were conducted, and a survey using questionnaires was also employed to enhance the power of generalisation. The developed framework is an accurate and reliable measurement instrument of corporate sustainability, and guidelines to assess qualitative criteria are put forward. The proposed framework can be used for a company’s self-assessment and for guiding practitioners in performance improvement and policy decision-making.     

Stakeholder Reporting: The Role of Intermediaries

Corporate social responsibility encompasses a multiplicity of different concepts, such that its nature is confused, and it remains difficult to operationalize because opening dialogue with and responding to the various expectations of diverse stakeholders is beyond the capacity of many companies. This paper adapts Mayston's normative “information beneficiaries” framework and focuses on intermediaries who might potentially use published financial information to open a restricted form of dialogue with companies, which might benefit unsophisticated stakeholders. The paper examines the Mayston framework using interviews conducted in organizations that might act on behalf of three stakeholder groups associated with gas and electricity suppliers in the United Kingdom, these being: consumers, employees, and the environment. While a long chain of communication exists between utility company and stakeholder, and many organizations do not fulfill their full potential as information intermediaries, there is some evidence that Mayston's framework might well operate in practice.     

Local Management Response to Corporative Restructuring: A Case Study of a Company Town

This is a case study of top management in a Swedish pulp industry at Skutskär. After decades of proactive response to change, starting in 1976 the pulp industry experienced a rapid and significant restructuring. In 1992, and after a prolonged hold on local investments, came a large‐scale investment with major labor reductions, which created a local crisis. The aim of this study is to analyze how top managers of a local business plant perceive and explain their citizenship relationship to the community of the company town during a transition period from 1976 to 2007. Our study shows that too much reliance on top management cost reduction requirements and not caring, or underscoring, local social concerns created gaps and local stakeholder distrust. We discuss how prolonged distrust of the company to bear social responsibility ended up in a broken relationship between the company and the local community. Our case indicates at least two problems that must be handled for successful corporate citizenship. First, the traditional control‐oriented management view is too narrow and not adjusted to today's citizenship reality, including how to handle corporate social responsibility. Second, we can see a possibility where the conceived needs on a global corporate level may lead to situations to obscure local needs and consequences.     

Sustainability in the Internal Operations of Companies

This paper¹ examines the issue of sustainability in the internal operations of companies. It examines what sustainability means in the business context, looks at how the concept can be measured with an example applied to companies in Brazil and examines the economics of corporate sustainability. It briefly explores the business case and raises a number of issues and questions that need to be discussed further. The paper ends with a suggested memo of concrete actions that a forward looking CEO could write to the company's senior managers.     

The impact of organisational alignment on the effectiveness of firms’ sustainability strategic performance measurement systems: an empirical analysis

Sustainability is becoming a mainstream issue for many organisations. A limited number of studies exist, however, on integrating sustainability into daily practices. Indeed, most of the research to date addresses only the definition and motivation for companies’ interest in environmental and social concerns. This paper contributes to the research on integrating sustainability into companies’ daily activities both directly and indirectly. It analyses the extent to which top management’s commitment to sustainability directly affects structural and social alignment and the effectiveness of measurement systems that monitor sustainability strategic performance and indirectly impacts firms’ social and environmental performance. Based on a quantitative analysis of survey responses from 405 large European companies, this paper documents the limited impact of social alignment to firms’ social and environmental performance. More specifically, the results challenge the diffuse belief that the alignment and commitment of middle managers to sustainability strategies as defined by the upper echelons have a relevant impact on the company’s social and environmental performance.     

Sustaining the Financial Value of Global CSR: Reconciling Corporate and Stakeholder Interests in a Less Regulated Environment

In this article we examine the association between corporate social responsibility (CSR) and firm value. This line of research is important since firms continue to invest in CSR even though past studies reveal a limited linkage between financial value and CSR. However, the business case for CSR or “doing good while making a profit,” appears to be advancing within the business ethics literature as a preferred conception of CSR. We conjecture that the greater unification and refinement of both profit maximization and stakeholder interests through corporate acts, not statements alone, will sustain the financial value of CSR in a less regulated global business environment. We study the triangle of what companies say, what companies do, and firm financial performance. We analyze Fortune 250 firms and find a positive association between what companies do based on KLD Research and Analytics, Inc. (KLD) ratings, and what companies state about ethics in their CSR statements. We then employ regression analysis and find that companies’ socially responsible acts are positively associated with overall firm value and financial performance. Yet we do not find a statistically significant association between what companies say regarding ethics in their CSR statements and their financial outcomes. These results suggest that firm value and financial performance is associated with what companies do and not what they say. Our results seem to be driven by multinational corporations (MNCs) and not by non‐MNCs. This is possibly because MNCs generally operate in a less regulated global business environment that often necessitates strong ethical corporate leadership to further stakeholder interests. Overall, these results help reconcile corporate and stakeholder objectives since evidence of a link between financial performance and doing good sustains global CSR.