Islamic Social Reporting and Halal Business Performance

Islamic social reporting (ISR) is used to assess a company's social performance based on Islamic principles. Islamic social performance reports will influence investors' decisions in investing. This research is to analyze factors influencing the Islamic Corporate Social Responsibility report. Data is obtained from the annual reports of 44 companies in the halal industry sector from 2013-2018, and analyzed using the Random Effect Model (REM) method. In this research, interest on debt-based Sharia Screening (SS) is divided by total assets with a maximum tolerance of 45 percent; the companies’ net-based Profitability (PRV) is divided by the total assets (ROA), and total debt-based leverage (LEV) is divided by equity (DER). The result is that Sharia Screening, Profitability, and Leverage affect ISR reporting. Increasing sharia screening and leverage will decrease ISR reporting, while increasing profitability will increase ISR reporting. Thus, the increase and decrease in this variable affect the companies’ decision to report the ISR. Therefore, companies must improve their financial performance to improve corporate social responsibility disclosure quality, which is very important for stakeholders in investing. Keywords: Islamic Social Reporting, Random Effect Model, Sharia Screening, Profitability, Leverage Abstrak. Pelaporan sosial Islam digunakan untuk menilai kinerja sosial perusahaan berdasarkan prinsip-prinsip Islam. Laporan kinerja sosial Islam akan mempengaruhi keputusan investor dalam berinvestasi. Penelitian ini dilakukan untuk menganalisis faktor-faktor apa saja yang mempengaruhi laporan sosial Islam dengan menggunakan 44 perusahaan sektor industri halal, data tahunan tahun 2013-2018, dan menggunakan metode random effect model (REM). Syariah Screening (SS) berbasis pada hutang bunga dibagi total aset dengan toleransi maksimal 45 persen, Profitabilitas (PRV) berbasis pada laba bersih perusahaan dibagi total aset (ROA), dan leverage (LEV) berbasis pada total hutang dibagi ekuitas (DER). Hasilnya adalah syariah screening, profitabilitas, dan leverage mempengaruhi pelaporan sosial Islam. Peningkatan syariah screening dan leverage akan menurunkan pelaporan ISR, sedangkan peningkatan profitabilitas akan meningkatkan pelaporan ISR. Dengan demikian kenaikan dan penurunan variabel ini mempengaruhi keputusan perusahaan untuk melaporkan ISR. Oleh karena itu, perusahaan harus meningkatkan kinerja keuangannya untuk meningkatkan kualitas pelaporan sosial Islam yang sangat penting bagi stakeholders dalam berinvestasi. Kata kunci: Pelaporan Sosial Islam, Random Effect Model, Syaria Screening, Profitabilitas, Leverage

A Study of the Relationship between Corporate Social Responsibility Report and the Stock Market

This study mainly investigates the relationship between corporate social responsibility (CSR) reporting and the reaction in the stock market. Specifically, we utilize the data from Taiwanese stock market from 2012 to 2017 to examine whether the CSR report disclosed by the listed companies on the Taiwan Stock Exchange and the Taipei Exchange will cause abnormal returns on the short-, mid- or long-term horizon. The empirical results demonstrate that companies which disclose their CSR reports generate higher and more positive mid- to long-term abnormal returns than undisclosed companies. In addition to filling the gap of previous studies, this study also examines whether CSR reports mitigate the information asymmetry between management and stakeholders. Companies disclosing their CSR reports will boost the confidence of investors and lead to higher stock return valuations.

Corporate environmental responsibility in China: a strategic political perspective

Purpose Against the background of the enormous economic transition China is undertaking, government intervention over corporate behavior is a frequent and, arguably, necessary measure. Among the most serious problems facing China, economically and reputationally, are environmental issues. So, how is the government intervening in the environmental performance of Chinese enterprises? And how are Chinese enterprises responding? These are the questions to be answered in this study. Design/methodology/approach This paper sampled listed companies on China’s Shanghai and Shenzhen Stock Exchanges. The data were collected from the HeXun corporate social responsibility report, CSMAR and WIND databases. A Tobit model was used to conduct the main 2SLS regression analysis, and the robustness tests followed the propensity score matching method. Findings The analysis shows that environmental performance is positively related to the government subsidies a company receives. The “Eight-point Regulation of the Centre” crack-down on social corruption introduced in 2012 has weakened rent-seeking overall, but rent-seeking behavior through the cloak of corporate environmental performance has become more serious. As a result, non-polluting and state-owned enterprises are significantly less concerned about their environmental performance, while polluting and private enterprises are more motivated to become good environmental citizens. Practical implications This research provides a greater understanding of the drivers behind environmentally-responsible behavior in Chinese companies. These insights can be used by policymakers and environmental regulators to incentivize a more widespread ground-swell of change across the gamut of Chinese business. Social implications Environmental policy and practice informed by research-driven recommendations can not only make valuable contributions to the health and well-being of Chinese society but also, as a significant contributor to climate change, environmental reforms have global benefits. Originality/value This study explores the motivations behind rent-seeking associated with environmental investment. The findings expand the research horizon of relevant literature on corporate political rent-seeking and deepen the understandings of the economic consequences of corporate investment into environmental practice. The results provide empirical evidence for the Chinese government to implement environmental regulations based on incentives beyond simple profit-making.

BENEFITS OF APPLYING CSR CONCEPTS IN THE FIELD OF HUMAN CAPITAL MANAGEMENT. PROVIDENT POLSKA CASE STUDY

Over the past few years, the importance of the concept of corporate social responsibility (CSR), which has a strong impact on the relationship between the organization and its stakeholders, has been increasing. The purpose of the article is to verify the benefits that the implementation of CSR tools can generate for an enterprise in the field of human resources management. Based on the example of Provident Polska, using in-depth interview methods and analysis of the content of the Provident Polska Corporate Social Responsibility report for 2016-2017, it has been shown that actions taken in relation to employees under the CSR concept affect the extension of the employment period, and the increase in the quality of work, improving work organization and employee satisfaction.

Corporate Sustainability Disclosure: A Leather Industry Perspective

This study aims to identify and compare the key social, economic and environmental sustainability practices in the leather industry. Content analysis was used to analyse extracted sustainability information from either the website, annual report, sustainability report or corporate social responsibility report of six leather-related companies. Review of existing literature assisted in categorising different practices under social, economic and environmental sustainability, while an identification of patterns among practices followed. Findings reveal that companies are observing a good practice of either dedicating a section of their website to revealing their sustainability activities or utilising their sustainability reports or annual reports. Energy efficiency, waste management and reduction of greenhouse gases emission were the most occurring environmental sustainability practices. Health and safety occurred as the dominant social sustainability practice, while economic sustainability practices have not been well defined, providing an opportunity for future research. The study provides a useful resource for managers and companies in the leather supply chain to learn from brands that have been embarking on sustainability efforts and assist them to a better understanding of the concept, in readiness for strategy formulation, implementation and reporting.

The determinants of Islamic social reporting disclosure and its impact on the profitability of sharia banks

Purpose - This study aims to determine of disclosure level of Islamic Social Reporting (ISR) and its impact on profitability at Sharia Commercial Bank in Indonesia.Method - This study uses Good Corporate Governance (GCG), which is proxied with self-assessment, number of commissioners, and number of Sharia Supervisory Board (DPS), financial is proxied with company size, company age, DER, Social Cost, BOPO, FDR, and NPF. Profitability is proxied with ROA and ROE. The sampling technique used a purposive sampling method. There are 12 Sharia Banks that meet the criteria of the study sample period 2013-2017.The result - The results showed that: first, GCG hurt ISR. Second, financial factors have a positive effect on ISR. Third, GCG negative affects profitability; the greater the number of commissioners and DPS will have an impact on the material costs of the Bank. Fourth, financial factors have a positive effect on profitability. Fifth, ISR hurts profitability. Sixth, ISR mediates the relationship between GCG and financial factors with profitability.Implication - This study helps sharia banks to maintain Islamic Social Reporting as a tool to get stakeholders’ trustOriginality - This study uses a corporate social responsibility report, which also presents the aspect of religiosity.