The Relationship Among Institutional Background, Corporate Governance And Corporate Social Disclosure

With enhanced understanding of the concept of sustainable development, corporate social responsibility (CSR) has been paid more attention to. The disclosure of CSR information is conducive to the public understanding of the fulfillment of CSR, and is also an important or even a vital issue of the development of the capital market, which has become research focus among academia. In general, the disclosure of information is constrained both internally and externally. Although the literature has studied the disclosure of CSR and its influencing factors, however it is mainly from a unilateral perspective and a comprehensive analysis on both internal and external system is lacking. In addition, the literature has not discussed the nature and the underlying mechanism of the disclosure of CSR, and a clear theoretical analysis on its influencing factors is missing.Currently, China is in the process of economic transition, due to historical and institutional reasons, there is a particular system background. As a protection of the interests of shareholders and other stakeholders, corporate governance is essentially a "fiduciary" responsibility. Therefore, particular external system background, internal corporate governance, and their interaction effect on the disclosure of CSR and its influencing mechanism, are of strong theoretical and practical value.This research builds on the review of the influencing factors of the disclosure of CSR, The theoretical foundation is from Stakeholder Theory, Legitimacy Theory, External Pressure Theory, Theory of Strategic Resources, Compliance Theory, Upper Echelons Theory, etc,and literature on the relationship between system background, corporate governance and the disclosure of CSR to propose the hypothesis and conceptual model. Based on the system change of the disclosure of CSR in 2008, the sample of this research is from listed companies of "Shenzhen 100 Index" and "SSE Corporate Governance Sector". We use traditional pairing method to select a set of paired samples from 2005 to 2010, and use descriptive analysis, correlation analysis, principal component factor analysis, multiple regression analysis and statistical software such as SPSS and AMOS research methods, and attempt to explore the external system background and the internal corporate governance and their interaction on the disclosure of CSR of listed companies in China based on lateral system environment, longitudinal system changes, as well as corporate governance. Further selecting media attention as a non-legislation system factor, incorporating characteristics of company executives and Reputation Theory, Impression Management Theory, we study on the influencing path and mechanism that system background and corporate governance affect the disclosure of CSR.The results of this research suggest that:(1) The system environment, especially the development of market intermediaries and legal environment, as well as media attention has contributed significantly to the disclosure of CSR; the disclosure of CSR with market competition positively (however insignificantly) correlates; mandatory regulation on disclosure of external social responsibility information is an important reason for the disclosure of CSR, and plays a guiding and exemplary role for other listed companies’voluntary disclose.(2) The top five shareholders positively affect the disclosure of CSR; there is a non-linear relation (an inverted U-shaped relation) between board size and the disclosure of CSR information; the audit committee contributes to the disclosure of CSR; independent directors, Chair-CEO duality improves the disclosure of CSR; supervisory committee positively and limitedly affect the disclosure of CSR; older, highly educated executives to some extent, can improve the level of the disclosure of CSR; the establishment of political association will promote the disclosure of CSR, but the deeper level of political association would play an adverse role; the moral level of executives is an important factor to promote the disclosure of CSR.(3) A higher stake of the top five shareholders can compensate for poor external system environment to promote the disclosure of CSR; the improvement of external system environment will increase the effectiveness of board governance, and thus improve the disclosure of CSR; with enhanced supervision, the supervisory committee will compensate for poor external system environment to promote the disclosure of CSR; when external system environment is poor, an appropriate structure of executive team that is highly educated, with high moral consciousness and political association can replace system environment, and actively make decision on the disclosure of CSR. In general, the results suggest that improved internal corporate governance can replace poor system environment to promote the disclosure of CSR, and improved external system environment to some extent enhances the effectiveness of corporate governance and increase the level of the disclosure of CSR.(4) The influence of media attention on the disclosure of CSR is partly through reputation mechanism of executives, other mechanisms need to be further studied.This research provides a new research perspective, in particular, non-legislation system, system environment, and corporate governance perspective of the disclosure of CSR. The results provide a theoretical basis and empirical evidence and contribute to improving system environment of the disclosure of CSR and corporate governance, accelerating system change, enhancing the level of the disclosure of CSR, and promoting the sustainable development of companies and society.