IDEAS home Printed from https://ideas.repec.org/a/bla/bstrat/v27y2018i8p1609-1622.html
   My bibliography  Save this article

What drives voluntary corporate water disclosures? The effect of country‐level institutions

Author

Listed:
  • Walid Ben‐Amar
  • Mohamed Chelli

Abstract

The purpose of this cross‐country comparative research is twofold. First, it investigates the country‐level institutional factors that affect corporate incentives to voluntarily disclose water information. Second, it examines the way in which the interaction between formal and informal institutions affects corporate reporting decisions regarding water‐related risks. The results reveal that the country‐level legal system shapes the firm's propensity to voluntarily respond to the 2015 Carbon Disclosure Project water survey. Uncertainty avoidance and societal trust are negatively related to the propensity to provide voluntary water disclosures, whereas countries' future orientation is positively related to the likelihood of water reporting. More importantly, the results indicate that the effect of informal institutions on water disclosure practices is contingent on the strength of formal institutions at the country level. The paper contributes to the emerging water literature and provides insights on the effects of the interaction between formal and informal institutions on corporate behavior.

Suggested Citation

  • Walid Ben‐Amar & Mohamed Chelli, 2018. "What drives voluntary corporate water disclosures? The effect of country‐level institutions," Business Strategy and the Environment, Wiley Blackwell, vol. 27(8), pages 1609-1622, December.
    • Handle: RePEc:bla:bstrat:v:27:y:2018:i:8:p:1609-1622
    DOI: 10.1002/bse.2227
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/bse.2227
    Download Restriction: no
    File URL: https://libkey.io/10.1002/bse.2227?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Charl de Villiers & Ana Marques, 2016. "Corporate social responsibility, country-level predispositions, and the consequences of choosing a level of disclosure," Accounting and Business Research, Taylor & Francis Journals, vol. 46(2), pages 167-195, February.
    2. Mike W Peng & Denis Y L Wang & Yi Jiang, 2008. "An institution-based view of international business strategy: a focus on emerging economies," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 39(5), pages 920-936, July.
    3. Elizabeth Stanny, 2018. "Reliability and Comparability of GHG Disclosures to the CDP by US Electric Utilities," Social and Environmental Accountability Journal, Taylor & Francis Journals, vol. 38(2), pages 111-130, May.
    4. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
    5. Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert W. Vishny, 1998. "Law and Finance," Journal of Political Economy, University of Chicago Press, vol. 106(6), pages 1113-1155, December.
    6. Elizabeth Stanny & Kirsten Ely, 2008. "Corporate environmental disclosures about the effects of climate change," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 15(6), pages 338-348, November.
    7. Philippe Aghion & Yann Algan & Pierre Cahuc & Andrei Shleifer, 2010. "Regulation and Distrust," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(3), pages 1015-1049.
    8. Carl J. Kock & Byung S. Min, 2016. "Legal Origins, Corporate Governance, and Environmental Outcomes," Journal of Business Ethics, Springer, vol. 138(3), pages 507-524, October.
    9. Ans Kolk & David Levy & Jonatan Pinkse, 2008. "Corporate Responses in an Emerging Climate Regime: The Institutionalization and Commensuration of Carbon Disclosure," European Accounting Review, Taylor & Francis Journals, vol. 17(4), pages 719-745.
    10. Luigi Guiso & Paola Sapienza & Luigi Zingales, 2008. "Trusting the Stock Market," Journal of Finance, American Finance Association, vol. 63(6), pages 2557-2600, December.
    11. René Orij, 2010. "Corporate social disclosures in the context of national cultures and stakeholder theory," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 23(7), pages 868-889, September.
    12. Jan Bebbington & Colin Higgins & Bob Frame, 2009. "Initiating sustainable development reporting: evidence from New Zealand," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 22(4), pages 588-625, May.
    13. Ball, Ray & Kothari, S. P. & Robin, Ashok, 2000. "Corrigendum to "The effect of international institutional factors on properties of accounting earnings"; [Journal of Accounting and Economics 29 (2000) 1-51]," Journal of Accounting and Economics, Elsevier, vol. 30(2), pages 241-241, October.
    14. Rory Sullivan & Andy Gouldson, 2017. "The Governance of Corporate Responses to Climate Change: An International Comparison," Business Strategy and the Environment, Wiley Blackwell, vol. 26(4), pages 413-425, May.
    15. Matthew Egan, 2014. "Making water count: water accountability change within an Australian university," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 27(2), pages 259-282, February.
    16. Ball, Ray & Kothari, S. P. & Robin, Ashok, 2000. "The effect of international institutional factors on properties of accounting earnings," Journal of Accounting and Economics, Elsevier, vol. 29(1), pages 1-51, February.
    17. Matthias S. Fifka, 2013. "Corporate Responsibility Reporting and its Determinants in Comparative Perspective – a Review of the Empirical Literature and a Meta‐analysis," Business Strategy and the Environment, Wiley Blackwell, vol. 22(1), pages 1-35, January.
    18. Mohamed Chelli & Sylvain Durocher & Anne Fortin, 2018. "Normativity in Environmental Reporting: A Comparison of Three Regimes," Journal of Business Ethics, Springer, vol. 149(2), pages 285-311, May.
    19. Pevzner, Mikhail & Xie, Fei & Xin, Xiangang, 2015. "When firms talk, do investors listen? The role of trust in stock market reactions to corporate earnings announcements," Journal of Financial Economics, Elsevier, vol. 117(1), pages 190-223.
    20. Stephen Brammer & Stephen Pavelin, 2006. "Voluntary Environmental Disclosures by Large UK Companies," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 33(7-8), pages 1168-1188.
    21. Licht, Amir N. & Goldschmidt, Chanan & Schwartz, Shalom H., 2007. "Culture rules: The foundations of the rule of law and other norms of governance," Journal of Comparative Economics, Elsevier, vol. 35(4), pages 659-688, December.
    22. Stephen Brammer & Stephen Pavelin, 2006. "Voluntary Environmental Disclosures by Large UK Companies," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 33(7‐8), pages 1168-1188, September.
    23. James Hazelton, 2013. "Accounting as a human right: the case of water information," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 26(2), pages 267-311, February.
    24. Michael A Witt & Gordon Redding, 2009. "Culture, meaning, and institutions: Executive rationale in Germany and Japan," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 40(5), pages 859-885, June.
    25. Francesco Calza & Giorgia Profumo & Ilaria Tutore, 2016. "Corporate Ownership and Environmental Proactivity," Business Strategy and the Environment, Wiley Blackwell, vol. 25(6), pages 369-389, September.
    26. K. Parboteeah & Helena Addae & John Cullen, 2012. "Propensity to Support Sustainability Initiatives: A Cross-National Model," Journal of Business Ethics, Springer, vol. 105(3), pages 403-413, February.
    27. Elizabeth Stanny, 2013. "Voluntary Disclosures of Emissions by US Firms," Business Strategy and the Environment, Wiley Blackwell, vol. 22(3), pages 145-158, March.
    28. Christ, Katherine L., 2014. "Water management accounting and the wine supply chain: Empirical evidence from Australia," The British Accounting Review, Elsevier, vol. 46(4), pages 379-396.
    29. Edward Tello & James Hazelton & Lorne Cummings, 2016. "Potential users’ perceptions of general purpose water accounting reports," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 29(1), pages 80-110, January.
    30. repec:hal:spmain:info:hdl:2441/4km7l02j139aj8hl7kcccmqk9s is not listed on IDEAS
    31. Leuz, Christian & Nanda, Dhananjay & Wysocki, Peter D., 2003. "Earnings management and investor protection: an international comparison," Journal of Financial Economics, Elsevier, vol. 69(3), pages 505-527, September.
    32. Walid Ben‐Amar & Philip McIlkenny, 2015. "Board Effectiveness and the Voluntary Disclosure of Climate Change Information," Business Strategy and the Environment, Wiley Blackwell, vol. 24(8), pages 704-719, December.
    33. Gregory Jackson & Androniki Apostolakou, 2010. "Corporate Social Responsibility in Western Europe: An Institutional Mirror or Substitute?," Journal of Business Ethics, Springer, vol. 94(3), pages 371-394, July.
    34. Irani, Rustom M. & Oesch, David, 2013. "Monitoring and corporate disclosure: Evidence from a natural experiment," Journal of Financial Economics, Elsevier, vol. 109(2), pages 398-418.
    35. Clarkson, Peter M. & Li, Yue & Richardson, Gordon D. & Vasvari, Florin P., 2008. "Revisiting the relation between environmental performance and environmental disclosure: An empirical analysis," Accounting, Organizations and Society, Elsevier, vol. 33(4-5), pages 303-327.
    36. Keryn Chalmers & Jayne M. Godfrey & Barbara Lynch, 2012. "Regulatory theory insights into the past, present and future of general purpose water accounting standard setting," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 25(6), pages 1001-1024, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jérôme Caby & Ydriss Ziane & Eric Lamarque, 2020. "The determinants of voluntary climate change disclosure commitment and quality in the banking industry," Post-Print hal-02927623, HAL.
    2. Camélia Radu & Nadia Smaili, 2022. "Alignment Versus Monitoring: An Examination of the Effect of the CSR Committee and CSR-Linked Executive Compensation on CSR Performance," Journal of Business Ethics, Springer, vol. 180(1), pages 145-163, September.
    3. Zhang, Linhan & Tang, Qingliang & Huang, Robin Hui, 2021. "Mind the Gap: Is Water Disclosure a Missing Component of Corporate Social Responsibility?," The British Accounting Review, Elsevier, vol. 53(1).
    4. Huixiang Zeng & Tao Zhang & Zhifang Zhou & Yang Zhao & Xiaohong Chen, 2020. "Water disclosure and firm risk: Empirical evidence from highly water‐sensitive industries in China," Business Strategy and the Environment, Wiley Blackwell, vol. 29(1), pages 17-38, January.
    5. Jeanne, Amar & Demaria, Samira & Rigot, Sandra, 2023. "What are the drivers of corporates' climate transparency? Evidence from the S&P 1200 index," Ecological Economics, Elsevier, vol. 213(C).
    6. Pei‐Chi Kelly Hsiao & Charl de Villiers & Claire Horner & Hein Oosthuizen, 2022. "A review and synthesis of contemporary sustainability accounting research and the development of a research agenda," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(4), pages 4453-4483, December.
    7. Lily Hsueh, 2019. "Opening up the firm: What explains participation and effort in voluntary carbon disclosure by global businesses? An analysis of internal firm factors and dynamics," Business Strategy and the Environment, Wiley Blackwell, vol. 28(7), pages 1302-1322, November.
    8. Caby, Jérôme & Ziane, Ydriss & Lamarque, Eric, 2022. "The impact of climate change management on banks profitability," Journal of Business Research, Elsevier, vol. 142(C), pages 412-422.
    9. Kamalesh Kumar & Rishtee Batra & Giacomo Boesso, 2021. "Difference in stakeholder engagement approach of small & medium enterprises and large companies and its performance implications," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(3), pages 992-1001, May.
    10. Kamalesh Kumar & Giacomo Boesso & Rishtee Batra & Jun Yao, 2019. "Explicit and implicit corporate social responsibility: Differences in the approach to stakeholder engagement activities of U.S. and Japanese companies," Business Strategy and the Environment, Wiley Blackwell, vol. 28(6), pages 1121-1130, September.
    11. Liu, Chengyun & Su, Kun & Zhang, Miaomiao, 2021. "Water disclosure and financial reporting quality for social changes: Empirical evidence from China," Technological Forecasting and Social Change, Elsevier, vol. 166(C).
    12. Giacomo Boesso & Barbara Fryzel & Marco Ghitti, 2023. "Corporate social responsibility and comparative capitalism frameworks: Evidence from the United States, Poland, and Italy," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(2), pages 531-547, March.
    13. Caby, Jérôme & Ziane, Ydriss & Lamarque, Eric, 2020. "The determinants of voluntary climate change disclosure commitment and quality in the banking industry," Technological Forecasting and Social Change, Elsevier, vol. 161(C).
    14. Yu‐Lin Chen & Mei‐Chu Huang, 2023. "Water usage reduction and CSR committees: Taiwan evidence," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(3), pages 1070-1081, May.
    15. Akrum Helfaya & Mark Whittington, 2019. "Does designing environmental sustainability disclosure quality measures make a difference?," Business Strategy and the Environment, Wiley Blackwell, vol. 28(4), pages 525-541, May.
    16. Yawen Gao & Jibao Gu & Hefu Liu, 2019. "Interactive effects of various institutional pressures on corporate environmental responsibility: Institutional theory and multilevel analysis," Business Strategy and the Environment, Wiley Blackwell, vol. 28(5), pages 724-736, July.
    17. Jiahao Gu & Liyuan Zheng & Changgao Cheng & Mengjiao Wang, 2023. "The Configuration Effect of Institutional Environment, Organizational Slack Resources, and Managerial Perceptions on the Corporate Water Responsibility of Small- and Medium-Sized Corporations," Sustainability, MDPI, vol. 15(10), pages 1-16, May.
    18. Sadiye Oktay & Serdar Bozkurt & Kübra Yazıcı, 2021. "The Relationship Between Carbon Disclosure Project Scores and Global 500 Companies: A Perspective From National Culture," SAGE Open, , vol. 11(2), pages 21582440211, May.
    19. Kamalesh Kumar & Giacomo Boesso & Rishtee Batra & Jun Yao, 2021. "Cross‐national differences in stakeholder management: Applying institutional theory and comparative capitalism framework," Business Strategy and the Environment, Wiley Blackwell, vol. 30(5), pages 2354-2366, July.
    20. Indah Fajarini Sri Wahyuningrum & Amin Chegenizadeh & Ain Hajawiyah & Sriningsih Sriningsih & Sri Utami & Mochamad Arief Budihardjo & Hamid Nikraz, 2023. "Determinants of Corporate Water Disclosure in Indonesia," Sustainability, MDPI, vol. 15(14), pages 1-17, July.
    21. Melsa Ararat & Borhan Sayedy, 2019. "Gender and Climate Change Disclosure: An Interdimensional Policy Approach," Sustainability, MDPI, vol. 11(24), pages 1-19, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fan, Hanlu & Tang, Qingliang & Pan, Lipeng, 2021. "An international study of carbon information asymmetry and independent carbon assurance," The British Accounting Review, Elsevier, vol. 53(1).
    2. Walid Ben‐Amar & Philip McIlkenny, 2015. "Board Effectiveness and the Voluntary Disclosure of Climate Change Information," Business Strategy and the Environment, Wiley Blackwell, vol. 24(8), pages 704-719, December.
    3. Le Luo & Qingliang Tang & Juan Peng, 2018. "The direct and moderating effects of power distance on carbon transparency: An international investigation of cultural value and corporate social responsibility," Business Strategy and the Environment, Wiley Blackwell, vol. 27(8), pages 1546-1557, December.
    4. Le Luo & Qingliang Tang & Hanlu Fan & Jamie Ayers, 2023. "Corporate carbon assurance and the quality of carbon disclosure," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 63(1), pages 657-690, March.
    5. Mumtaheena Anwar & Sohanur Rahman & Md. Nurul Kabir, 2021. "Does national carbon pricing policy affect voluntary environmental disclosures? A global evidence," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 23(2), pages 211-244, April.
    6. Isabel Gallego‐Álvarez & María Consuelo Pucheta‐Martínez, 2020. "How cultural dimensions, legal systems, and industry affect environmental reporting? Empirical evidence from an international perspective," Business Strategy and the Environment, Wiley Blackwell, vol. 29(5), pages 2037-2057, July.
    7. Isabel Gallego‐Alvarez & Eduardo Ortas & José Luis Vicente‐Villardón & Igor Álvarez Etxeberria, 2017. "Institutional Constraints, Stakeholder Pressure and Corporate Environmental Reporting Policies," Business Strategy and the Environment, Wiley Blackwell, vol. 26(6), pages 807-825, September.
    8. Daniela Coluccia & Stefano Fontana & Silvia Solimene, 2018. "Does Institutional Context Affect CSR Disclosure? A Study on Eurostoxx 50," Sustainability, MDPI, vol. 10(8), pages 1-20, August.
    9. Luo, Le & Tang, Qingliang, 2016. "Determinants of the Quality of Corporate Carbon Management Systems: An International Study," The International Journal of Accounting, Elsevier, vol. 51(2), pages 275-305.
    10. Mitzi Isabel Cubilla‐Montilla & Purificación Galindo‐Villardón & Ana Belén Nieto‐Librero & María Purificación Vicente Galindo & Isabel María García‐Sánchez, 2020. "What companies do not disclose about their environmental policy and what institutional pressures may do to respect," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(3), pages 1181-1197, May.
    11. Melsa Ararat & Borhan Sayedy, 2019. "Gender and Climate Change Disclosure: An Interdimensional Policy Approach," Sustainability, MDPI, vol. 11(24), pages 1-19, December.
    12. Ishmael Tingbani & Lyton Chithambo & Venancio Tauringana & Nikolaos Papanikolaou, 2020. "Board gender diversity, environmental committee and greenhouse gas voluntary disclosures," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2194-2210, September.
    13. Ding, Yuan & Hope, Ole-Kristian & Jeanjean, Thomas & Stolowy, Herve, 2007. "Differences between domestic accounting standards and IAS: Measurement, determinants and implications," Journal of Accounting and Public Policy, Elsevier, vol. 26(1), pages 1-38.
    14. Tobias Steindl, 2021. "Cultural rule orientation, legal institutions, and the credibility of corporate social responsibility reports," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(1), pages 310-332, January.
    15. María Consuelo Pucheta‐Martínez & Isabel Gallego‐Álvarez, 2018. "Environmental reporting policy and corporate structures: An international analysis," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 25(5), pages 788-798, September.
    16. Tsalavoutas, Ioannis & André, Paul & Evans, Lisa, 2012. "The transition to IFRS and the value relevance of financial statements in Greece," The British Accounting Review, Elsevier, vol. 44(4), pages 262-277.
    17. In‐Mu Haw & Bingbing Hu & Lee‐Seok Hwang & Woody Wu, 2004. "Ultimate Ownership, Income Management, and Legal and Extra‐Legal Institutions," Journal of Accounting Research, Wiley Blackwell, vol. 42(2), pages 423-462, May.
    18. Isabel‐María García‐Sánchez & Jennifer Martínez‐Ferrero & María‐Antonia Garcia‐Benau, 2019. "Integrated reporting: The mediating role of the board of directors and investor protection on managerial discretion in munificent environments," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(1), pages 29-45, January.
    19. Emerald Edem Welbeck & Godfred Matthew Yaw Owusu & Rita Amoah Bekoe & John Amoah Kusi, 2017. "Determinants of environmental disclosures of listed firms in Ghana," International Journal of Corporate Social Responsibility, Springer, vol. 2(1), pages 1-12, December.
    20. van der Laan Smith, Joyce & Gouldman, Andrea L. & Tondkar, Rasoul H., 2014. "Does the adoption of IFRS affect corporate social disclosure in annual reports?," Advances in accounting, Elsevier, vol. 30(2), pages 402-412.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:bstrat:v:27:y:2018:i:8:p:1609-1622. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1099-0836 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.