scholarly journals Enhancing transparency through company law reform in China

2018 ◽  
Vol 66 (1) ◽  
pp. 43-69
Author(s):  
Jingchen Zhao

A growing awareness of corporate social responsibility (CSR) is always reflected by an increase in the number of CSR or sustainability reports published, as well as in the provision of CSR-related information. The growing importance of socially responsible investment and of the media are converging, and an increasing awareness of companies’ social, ethical and environmental performance calls for greater transparency in reporting. Corporate disclosure is one of the most common means of ensuring adherence to corporate governance principles such as fairness and transparency. This issue is particularly important for China, where guanxi and government control are regarded as key elements for business transactions. This article sets out to explore the emerging practice of CSR reporting in China to examine whether current practice is motivated by the purpose of discharging accountability to relevant stakeholders, and also whether it is helpful to transplant the UK’s ‘strategic report’ system to China. It is salient to discuss why the CSR reporting system is important to China in order to promote CSR and a harmonious society, and how to enforce the scheme by mandatory regulations and voluntary guidelines. If a CSR reporting system is established, there is likely to be resistance to major regulatory changes. It would be desirable to maintain a balance between efficient disclosure and increased burdens for companies in order to achieve the ultimate purpose of boosting the competitive advantages of companies through increased transparency via corporate disclosure.

2018 ◽  
Vol 31 (1) ◽  
pp. 22-45
Author(s):  
Zhongtian Li ◽  
Shamima Haque ◽  
Ellie (Larelle) Chapple

Purpose This paper aims to examine changes of non-financial voluntary reporting practices over time in response to episodes of employee-related distress. It investigates employee-related disclosures by the four largest electronic manufacturing services firms in China between 2008 and 2013 during a series of employment-related incidents, to investigate how the firms re-legitimate their reputation in response to the media coverage on those incidents. Design/methodology/approach A series of employee-related incidents that occurred in 2010-2012 is selected as the focus of this study, with total coverage of employee-related disclosures between 2008 and 2013. These incidents are directly linked to three of the four sample companies: Foxconn, Pegatron and Compal Electronics. Employee-related disclosures in corporate social responsibility (CSR) stand-alone reports are coded by a set of specifically designed instructions, and newspaper articles about employee-related incidents are coded for sentiment. Results are interpreted through two theoretical lenses: the media agenda setting theory and the legitimacy theory. Findings Newspapers reported the employee-related incidents in a way detrimental to the legitimacy of firms that directly involved in the selected industry. In the process of legitimation, firms switch between disclosing more employee-related information and reducing disclosures. The self-expectation on organizational legitimacy also affects how CSR reporting is used in legitimation. The employee-related disclosure analysed is closer to symbolic legitimation than substantive legitimation. Originality/value This study contributes to reporting practice by showing that employee-related disclosure is largely vacuous and to a greater extent is used as symbolic legitimation. The quality of disclosure requires significant improvement. This study contributes to the literature by using the legitimacy theory to interpret employee-related disclosure in China, addressing inadequate research efforts in the context of social and human rights dimensions of CSR reporting.


2019 ◽  
Vol 7 (1) ◽  
pp. 1
Author(s):  
Mohd Nizam Barom

Understanding Socially Responsible Investing and Its Implications for Islamic Investment Industry // // // // // Social, ethical and environmental concerns have been used as important consideration for investment decision by an increasing number of investors. This can be seen by the size and growth of the socially responsible investment (SRI) industry in the developed economies. At the same time, scholars and commentators of Islamic finance have also called for Islamic investment industry to learn from the experience of SRI in incorporating social responsibility issues in the investment process, in line with the ethical principles of Islam and the overall objective of the Shari’ah (Maqasid al-Shari’ah). This would require Islamic investment sector to have a clear understanding of the SRI industry in order to effectively benefit from its experience. This is particularly critical due to the significant diversity of investors and complexity in the issues and strategies adopted in the SRI industry. Hence, this paper adds to the Islamic investment literature by providing an extensive  and systematic survey of SRI industry in terms of its (i) underlying motivations and values; (ii) issues of concerns; (iii) types of investors; and (iv) screening strategies. It then synthesizes these components within the context of the ‘value-based’ investors. This synthesized framework offers a useful tool for Islamic investment practitioners to understand the theoretical and practical aspects of SRI. Subsequently, the paper highlights important implications of the findings for Islamic investment industry in terms of the issues that it needs to consider in emulating SRI practices and a number of lessons that it can learn from the SRI experience.  


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