Implicit Versus Explicit Corporate Social Responsibility Disclosure: A Textual Analysis

54 Pages Posted: 26 Dec 2017

See all articles by Katrin Hummel

Katrin Hummel

University of Zurich

Stephanie Mittelbach-Hoermanseder

WU Vienna

Charles H. Cho

York University - Schulich School of Business

Dirk Matten

York University - Schulich School of Business

Date Written: December 20, 2017

Abstract

This study draws on the implicit-explicit framework of Matten and Moon (2008) and investigates differences in both the language and the topics of voluntary corporate social responsibility (CSR) disclosure between firms located in liberal market economies (LMEs) and firms located in coordinated market economies (CMEs). According to the framework, LMEs are characterized by a gap on CSR issues and firms react to it through explicit disclosure. In CMEs, on the other hand, CSR issues are strongly institutionalized through policies and legislation and consequently firms more implicitly report on these issues. We use computer-based textual analysis to measure the explicitness of voluntary CSR disclosure. Concerning language, we argue that CSR disclosure by firms in LMEs is more readable and more positive in tone. With respect to topics, we expect CSR disclosure by firms in LMEs to be more explicit about education, philanthropy and parental leave policies. Our results are based on a sample of 973 reports over a period of eight years. We find evidence that voluntary CSR disclosure provided by firms in LMEs is more positive in tone and more explicit with regard to educational, philanthropic and parental issues compared to the disclosure provided by firms in CMEs. With respect to the readability of the disclosure, the findings are ambiguous and heavily dependent on the underlying measure of readability.

Keywords: CSR disclosure, implicit CSR, explicit CSR, readability, textual analysis, tone

Suggested Citation

Hummel, Katrin and Mittelbach-Hoermanseder, Stephanie and Cho, Charles H. and Matten, Dirk, Implicit Versus Explicit Corporate Social Responsibility Disclosure: A Textual Analysis (December 20, 2017). Available at SSRN: https://ssrn.com/abstract=3090976 or http://dx.doi.org/10.2139/ssrn.3090976

Katrin Hummel (Contact Author)

University of Zurich ( email )

Rämistrasse 71
Zurich, CH-8006
Switzerland

Stephanie Mittelbach-Hoermanseder

WU Vienna ( email )

Welthandelsplatz 1
Vienna, Wien 1020
Austria

Charles H. Cho

York University - Schulich School of Business ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

HOME PAGE: http://schulich.yorku.ca/faculty/charles-cho

Dirk Matten

York University - Schulich School of Business ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

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