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CORPORATE SOCIAL RESPONSIBILITY REPORTING

IN MALAYSIA: AN ANALYSIS OF WEBSITE REPORTING OF SECOND BOARD

COMPANIES LISTED IN BURSA MALAYSIA

Chan Shirley, Ang Gaik Suan, Chan Pau Leng,

Maurice O.A. Okoth and Ng Bee Fei

SEGi University College

9, JalanTeknologi, Taman Sains Selangor,

Kota Damansara PJU5,

47810 Petaling Jaya

E-mail: shirleychan@segi.edu.my

ABSTRACT

This paper focuses on Corporate Social Responsibility (CSR) web reporting made by 117

Second Board Companies listed in Bursa Malaysia (BM) across a representative cross-

section of the industrial sectors. Content analysis methodology was used. The purpose of the

study is to examine the incidence of CSR web reporting in companies’ websites. Studies on

CSR reporting is still lacking in the developing countries including Malaysia. CSR touches

every company irrespective of its size and industry where it operates. The present study fills

the gap in the literature by looking at the companies listed only in the Second Board of BM.

The statistical tests carried out to analyse the data collected are Chi-Square, ANOVA and

Correlation Coefficient. Findings from the study suggest that CSR web reporting among

companies listed in the Second Board of BM focuses more on the Community than any other

areas like Marketplace. This is inconsistent with the previous study done on the companies

listed in the Main Board of Kuala Lumpur Stock Exchange (KLSE) and also studies done in

other developing countries. Finally, it discusses its limitations, implications and some

recommendations for any intended future study.

1.0 INTRODUCTION

CSR encompasses a wide spectrum of issues ranging from business ethics, corporate

governance and socially responsible investing (SRI) to environmental sustainability and

community investment. CSR envisages the ideal whereby enterprises integrate social and

environmental concerns in their business operations and their interaction with their stakeholders

usually on a voluntary basis. CSR is about the behaviour of businesses over and above what is

ordinarily required by regulatory bodies and legal requirements, not least because it is

voluntarily practiced but because businesses deem it to be in their long-term interest to do so.

CSR is also about maintaining an enterprise's "license to operate". This concept whereby the

society in which a business operates frames their view on how the activities and the offerings of

the business affect them. Their subsequent appraisal of the impact will then determine their

reaction to the business in terms of "allowing" the business to operate in the manner that they

have been and hence the concept of "license to operate". CSR is also about the contribution of

businesses towards sustainable development.

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The Securities Commission (SC) views CSR as a natural progression of its ongoing work in

relation to the development of a strong framework for good corporate governance, under which

companies look beyond the shareholder value and take into account the wider interests of other

stakeholders, such as employees, creditors and the society at large. In addition, the SC is keen to

see more Malaysian companies incorporate CSR into their corporate governance agenda, not

only to develop better corporate citizens, but also to enhance the recognition and profile of

domestic companies in the eyes of international and domestic institutional investors.

Furthermore, the push towards a better CSR is consistent with the overall national agenda,

particularly in relation to achieving Malaysian Vision 2020, meeting the objectives of the

National Integrity Plan and generating greater economic and capital market growth.

Malaysian Vision 2020 is geared towards pushing to rank the country among the fully

developed nations. In the effort to realise this dream, the country has ensured a strict

implementation of its development plan the latest being the 9th

Malaysian Development Plan

(9MP). As a developing nation, Malaysia has many challenges and deadlines to beat to cross

over to the other side of the world. These include the famous Millennium Development Goals

(MDGs) introduced by the UN in the recent years. The onus of realising the country’s dream

should not be left to the Government alone. Every Malaysian and every sector of the economy

of the nation have a role to play. The contribution of the business community will not only be

measured by the taxes they pay to the Government, but also by their contribution to the

preservation and protection of the environment and the social welfare of the communities in

which they operate. Ironically, studies done in Malaysia and other developing countries show a

slower response to the issues of CSR. Nik Nazsli bt Nik Ahmad, Maliah bt Sulaiman, and

Dodik Siswantoro (IIUM Journal of Economics and Management 11, no.1 (2003)) while

quoting the earlier research done by (Abu-Baker and Naser, 2000; Belal, 2001; Imam, 2000;

and Tsang, 1998), note that developing countries are slower in responding to the increased

concern about the issue of CSR. That despite increase in research studies in this area in the

developing countries is still scarce.

The present paper focuses on CSR reporting in the websites of the Second Board Companies

listed in the BM. A lot of information is available on CSR reporting in the developed countries

which is not the case of the developing nations, Malaysia, in particular. The most recent

published studies done in the Malaysian context are the works of Teoh and Thong (1984),

Andrew (1989) and Nik Nazli bt Nik Ahmad, Maliah bt Sulaiman and Dodik Siswantoro

(2003). For instance, recent research focused on the companies listed in the Main Board of

KLSE by Ahmad N. N, Sulaiman M., and Siswantoro D., 2003.

However, the country has undergone tremendous development in this area. The Government of

Malaysia in its 2007/2008 Budget outlined incentives for companies with CSR programmes and

also introduced the need for public listed companies to disclose their CSR activities. Such

support from the Government also plays a role in pushing through the CSR agenda among

companies in Malaysia. Companies are beginning to move beyond just philanthropy efforts.

However, much is yet to be done as most companies particularly in the Second Board are yet to

design CSR activities in line with their corporate philosophies that create a win-win situation

for both the business sector and the communities around them. The findings of Teoh and Thong

(1984), Andrew (1989) and Nazli, Maliah, and Siswantoro (2003) may now have been over

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taken by many events with these social and economic changes that have taken place in the

country.

For the past few years, CSR development in Malaysia has grown. The call for the adoption of

good CSR leadership and practices are frequently heard in the form of various speeches made

by the members of the public through the authorities. CSR aspirations in Malaysia are also

evident in the 9MP and the Capital Market Masterplan. CSR development received a significant

boost when the Prime Minister (PM) who was also the Finance Minister in Budget 2007/2008

speech announced the requirements for Public Listed Companies to report on their CSR

initiatives. The PM’s call was really an opportunity for the logical thinking about CSR and for

the companies to become more engaged in being socially responsible in the way they normally

work and think.

This was followed by BM’s launch of its CSR framework for the Malaysian Public Listed

Companies (PLCs) and its directive to the PLCs to adopt CSR reporting. Also, Khazanah

Nasional Berhad, as part of its Government License Companies (GLCs) transformation

programme released the Silver Book which contains CSR guidelines for the GLCs. These

initiatives are timely as we seek to position Malaysian companies in the global market using the

CSR platform.

CSR Malaysia, a unique network of corporate and academic institutions, committed to

advancing responsible business strategy and practices was launched in November 2006. The

body is expected to have a triple bottom line impact - people, environment, and economies. Its

strategies are built to raise the level of CSR consciousness amongst corporate Malaysia,

increase the capacity and capability to combat environmental and social concerns to promote

responsible businesses are part of the solution towards sustainable development. A number of

companies who share similar beliefs and aspirations have become corporate members of CSR

Malaysia and others have indicated to follow suit. They already members include Nestle

Malaysia, BP Malaysia, BAT Malaysia, Shell Malaysia, YTL Corp, HSBC, Standard Chartered

Bank, Maxis Communication, Digi, TNB and Telekom Malaysia among others. While among

the key areas of immediate concern is raising awareness and building capacity on responsible

business, CSR Malaysia also aims to encourage Malaysia companies to adopt global CSR

Principles and best practices such as signing up to the UN Global Compact

(http://www.undp.org.my/uploads/files).

The BM has provided a framework for the PLCs to help them in the practice of CSR. However,

the organisation has confessed that it neither provides the complete story about CSR nor the

answer. It has called it as “a one size fits all”. The criterion provided does not apply uniformly

to all companies as each has to choose on the one relevant to its field of business in order to

gain competitive advantage. The framework focuses on 4 dimensions:

• Environment: Climate Change, Energy (Renewable Energy, Energy

Efficiency, Biofuel), Waste Management, Biodiversity, and Endangered Wildlife;

• Community: Employee Volunteerism, Education (Schools Adoption

Scheme), Youth Development, Underprivileged, Graduate Employment and Children;

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• Marketplace: Green Products, Stakeholder Engagement, Ethical Procurement, Supplier

Management, Vendor Development, Social Branding and Corporate Governance; and

• Workplace: Employee Involvement, Workplace Diversity, Gender Issues, Human

Capital Development, Quality of Life, Labour Rights, Human Rights and Health &

Safety.

In Malaysia, there are presently no accounting standards for disclosing CSR information. In the

absence of such standards, CSR disclosures in Malaysia would be entirely voluntary in nature.

Thus, companies have full discretion as to the annual report disclosure. It is feared that this

slack of standards may mean that any existing CSR disclosures will be very much public-

relations oriented. It is, therefore, the purpose of the present study to document evidence of

current CSR reporting in Malaysia, including the nature and type of such reporting. The SC of

Malaysia’s Chairperson, Datuk Zarinah Anwar while addressing a UNDP Development

programme in Malaysia Seminar stated that CSR is about doing business and not only building

schools and providing scholarships. She noted that CSR provides organisations with better

reputation, brand value, sales and customer loyalty (The Star, Friday, 28th

July 2006).

Today’s Society

The prosperity enjoyed by human beings is in fact a result of a harmonious relation between

mankind and nature. In the process of development, there is a tendency among human beings to

manipulate and exploit nature excessively by using science and technology, thus resulting in an

imbalance of nature. Hence, in facing the current challenges of globalisation, integrated

knowledge, science and technology advancements, image and reputation play an increasingly

important role in the business competitive environment. Greater concern and scrutiny about

corporate practices related to sustainable development are being carried out.

Companies are aware that ensuring environmental protection and promoting social

responsibility, including consumer interests are essential to achieve sustainable business success

and shareholders’ value instead of maximising short-term profit only. In response to the

demand, a wide range of CSR initiatives has emerged in recent years. Some of major

international CSR initiatives are as follows:

• Voluntary codes and standards for corporate behaviour;

• Voluntary reporting guidelines;

• Auditing/verification of reports, production processes, supply chain

standards or products;

• Policy frameworks, including reporting requirements, tax incentives and

enabling legislation;

• Multi-stakeholder partnerships;

• Work with supply chains;

• Dissemination of best practice.

The PM of Malaysia mentioned in the 2006 budget speech the requirement for all PLCs to

disclose their CSR activities. The directive from the PM is really an opportunity for logical

thinking about CSR and for the companies to become more engaged in being socially

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responsible, and to harmonise their approach in the process of CSR with the way they normally

work and think. This may also mean considering CSR as part of their core business.

2.0 LITERATURE REVIEW

2.1 Definition of CSR

Concern about CSR has grown significantly in the recent past among the academicians,

governments and general public. Even so, it is still not clear whether it is ethical for the

corporations to disclose whether they are socially responsible, or not. There is also limited

knowledge on what constitutes CSR. Despite all the interest on the debate about CSR, there is

no universal definition on the term. The World Business Council for Sustainable

Development states that ‘CSR is the continuing commitment by business to behave ethically

and contribute to economic development while improving the quality of life of the workforce

and their families as well as of the local community and society at large.’ It is the activities

carried out by members in an organisation beyond the bottom line for the interest of the public

as a whole. South China Morning Post, 2002 defines CSR as ‘The notion of companies

looking beyond profits to their role in society is generally termed corporate social responsibility

(CSR)….It refers to a company linking itself with ethical values, transparency, employee

relations, compliance with legal requirements and overall respect for the communities in which

they operate. It goes beyond the occasional community service action, however, as CSR is a

corporate philosophy that drives strategic decision-making, partner selection, hiring practices

and, ultimately, brand development.’ The Institute of Directors, UK, 2002 puts it as ‘CSR is

about businesses and other organisations going beyond the legal obligations to manage the

impact they have on the environment and society. In particular, this could include how

organisations interact with their employees, suppliers, customers and the communities in which

they operate, as well as the extent they attempt to protect the environment.’

2.2 CSR Disclosure Practices

The disclosures of CSR have been the interest among the academic researchers which may be

attributed to the increasing recognition in the business community of the importance major

stakeholders attach to socially and environmentally responsible corporate behaviour (Zadek,

1998). A number of definitions of CSR disclosures have been given by various i.e. Deegan and

Rankin (1996, 51), for instance, describe such disclosures as: “. . . disclosures relating to the

interaction between an organisation and its physical and social environment inclusive of

disclosures relating to human resources, community involvement, the natural environment,

energy and product safety.” As mentioned earlier, most empirical studies in this field have been

undertaken to examine the content of annual reports for CSR disclosures in developed countries

like the U.K., Canada, the U.S., Australia and Western Europe (Guthrie and Parker, 1990; and

Roberts, 1992). Only handful of studies have examined CSR disclosure practices in the

developing countries, e.g., Bangladesh, Jordan, Malaysia and Singapore (Nazli, Maliah, and

Siswantoro, 2003; Belal, 2001; Imam, 2000; Abu Baker and Naser, 2000; Teoh and Thong,

1984; Andrew, 1989; and Tsang, 1998).

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Nazli, Maliah, and Siswantoro (2003) using content analysis examined CSR disclosures related

information in the annual reports of 98 listed in KLSE across the industries. The results showed

that 84% of the companies in the sample had some form of CSR disclosures. This was a

significant increase of up to 26% from the earlier study undertaken in Andrew (1989). On

content category 72.4% of the companies in the sample made disclosure in the area of products

and consumers and the theme on Employee came second with 62.2%. Declarative Statements

was the most preferred method of disclosure with 86%. This was consistent with studies done in

the developing countries (Abu Baker and Naser, 2000; Tsang, 1998; and Belal, 2001).

Surprisingly, only 23.4% of the sample companies made monetary disclosures.

Research done in South Africa on the extent of CSR disclosures in annual reports among 115

companies revealed that as many as 50 % of the companies had some CSR disclosures, with

human resource disclosures being the most popular followed by disclosures on community

involvement and environmental performance (Savage 1994). The extent of disclosure, however,

is considerably low compared the developed countries. Tsang (1998) in a study of 33 public

listed companies in Singapore, in the banking, food and beverages and hotel industries revealed

that CSR disclosures were mainly in the area of human resources and community involvement.

Though the study found some increases in the amount of CSR disclosures over the ten-year

period, the extent of disclosure is still low.

However, a survey done in Bangladesh by Imam (2000) and Belal (2001) found that the level of

such disclosures was very poor and inadequate. Belal examined the annual reports of 30

companies listed on the Dhaka Stock Exchange. He found that though 97% of companies made

some form of CSR disclosure, the volume disclosed was very low. The disclosures were largely

descriptive in nature, and emphasized ‘good news’. Only one instance of ‘bad news’ disclosure

was found (Belal, 2001).

While also using content analysis to examine the annual report in 143 of Jordanian listed

companies on the Amman Financial market focusing on the content-category themes, methods

and location of CSR disclosures, Abu Baker and Naser (2000) found human resources and

community involvement as the predominant themes for CSR disclosure. The extent of CSR

disclosure was also noted to be very low (Abu Baker and Naser, 2000). This finding was

consistent with the results of prior studies done in other developing countries (Andrew, 1989;

Savage, 1994; and Teoh and Thong, 1984).

In Malaysia, there are a few major empirical studies that have been published on CSR practices.

These include a personal interview questionnaire survey by Teoh and Thong (1984) which

surveyed a combination of one hundred foreign and locally owned companies in Malaysia. The

study focused on three issues namely, the concept of CSR, the nature and extent of corporate

involvement in such activities and corporate social reporting. The results found that only 29%

of the companies in the sample reported on social performance in their annual report. The rest

constituting 71% did not. The study also revealed that foreign-owned companies made more

CSR disclosures than local Malaysian companies. The areas reported on most frequently were

human resources and products or services to companies. The study however, did not examine

the extent of CSR disclosures. The major limitation of this study is that it was based solely on

personal interviews with no attempt to examine other major means like content analysis

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approach. Thus, this present study seeks to provide a more detailed description of CSR

reporting by employing a content analysis methodology. Meanwhile, Andrew (1989) examined

119 annual reports of publicly listed companies in Malaysia and Singapore in 1983 found that

only 26% of the companies had some CSR disclosures. They also found that a higher number of

large and medium size companies disclosed social information as compared to smaller sized

ones. As if it was the order of the day, human resource was also the dominant theme. The

industry that had the highest proportion of companies with CSR disclosures in their annual

reports is the banking and finance industry. On the whole, the study clearly showed that the

level of CSR disclosures, then, was very low, ranging from less than a quarter of a page to

slightly more than one page. The authors, however, did not make any distinction between

Malaysian and Singaporean companies. As a result, one is unable to get a complete picture of

the CSR disclosures in each individual country.

Another study done to explore how attributes of chief executives in Malaysia may affect the

formulation and

implementation of socially responsible policies and programmes

of

organisations found that companies with Malay chief executives demonstrate higher corporate

social performance levels than companies with Chinese chief executives; and that

the age of

chief executives is a significant predictor of the socially responsibility level. However, the

education background of the chief executives has no noticeable effect on it (Ramasamy B.,

2007). A research done to examine social responsibility information disclosure on the internet

by Portuguese banks in 2004 and compared the internet and 2003 annual reports as disclosure

media using content analysis found that banks with a higher visibility among consumers seem

to exhibit greater concern to improve the corporate image through social responsibility

information disclosure (Branco M. C., and Rodrigues L. L., 2006).

It is also important to note that Teoh and Thong (1984) used a personal interview survey,

whereas Andrew (1989) examined annual reports. Hence, it is difficult to compare the findings

of these two studies due to difference in methodology. Furthermore the studies were based on

all the listed companies in KLSE. The present study is scaling down to Second Board

Companies listed in the BM. The study also undertakes the content analysis on the CSR

reporting within the companies’ websites. This study notes the increased levels of education

particularly in IT related subjects and heightened awareness on issues related to the social and

environmental responsibilities of businesses. There is, therefore, a gap in knowledge on current

CSR reporting practices in Malaysia. Hence, the present study intends to fill this gap.

3.0 PURPOSE OF THE STUDY

The study undertaken by Nazli, Maliah, and Siswantoro (2003) focused on the selected

Companies from the entire PLCs under KLSE and focused on the disclosures of CSR in their

Annual Reports.

This paper focuses on the CSR web reporting of the Second Board Companies in the BM. This

paper seeks to contribute to the literature by reviewing and documenting CSR reporting of a

relatively select or second tier of the listed Malaysian companies. The present study will also

extend the literature as no recent studies have provided any published report in this area.

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The study comprises a cross-section of the largest 235 companies listed on the Second Board of

the BM. This would be a meaningful contribution given that similar studies on social

disclosures have basically focused on the main-board and the analysis was on the Annual

Reports, which limits the generalization of the findings. This study will also provide an

opportunity for inter-industry comparisons as in the work of Nazli (2003).

More specifically, the objectives of the present study are as follows:

• To examine the CSR web reporting practices of a sample of Second Board Companies

listed in the BM across different industries;

• To examine the theme of CSR web reporting, i.e., environment, community,

marketplace and workplace;

• To determine the extent of CSR web reporting, as measured by the number of sentences;

and

• To determine the locations of CSR web reporting within the annual report, i.e.,

Chairman’s Statement, Operations Review, Corporate Diary or other sections and

website.

4.0 THEORETICAL FRAMEWORK

4.1 Companies’ Background

Type of Industry: Businesses can not exist in isolation. It depends on the society within which

it operates for its resources such as manpower, infrastructure and the environment. The more

business entity draws from the society, the more it needs to contribute to the community

benefits in order to sustain growth. Moreover, CSR goes hand-in-hand with the culture of

industry within the society. Hence, we hypothesised that CSR web reporting of Second Board

Companies is dependent on the industry in which the company operates.

Firm Size: CSR is a function of economic wealth. In general term, the larger a corporation, the

wealthier a corporation is. This will, in turn, generate a higher profit from its business. With the

combination of a corporation’s wealth and its competency, it will be able and thus is more

willing to contribute to the society’s well being.

COMPANIES’ BACKGROUND

Type of Industry; Firm Size;

THEME OF CSR WEB REPORTING

Environment; Community;

Marketplace; Workplace

EXTENT OF CSR WEB

REPORTING

No. of Sentences

LOCATIONS OF CSR WEB

REPORTING

Annual Reports; Website

Corporate Social

Responsibility

Reporting

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4.2 Theme of CSR Web Reporting

Based on the framework laid out by BM as explained earlier, it comprises environment,

community, marketplace and workplace. This is in tandem with the previous researches done by

(Nik, Maliah and Siswantoro, 2003, Ernst & Ernst, 1972-1978; Gray, 1987; Mathews, 1993;

Perks, 1993).

It is assumed that CSR web reporting of Second Board Companies focuses more on

Marketplace dimension for two reasons. First, it is no secret that the most sustainable way for

any businesses to remain competitive is to persistently improve its products and service

delivery. This is to ensure that they can remain absolutely relevant to the target market and to

do so in a manner which differentiates themselves from their competitors. Second, consumers of

today are better informed and are able to put their beliefs into action. With today’s rapid

technology advancement, e.g. the internet, it enables the consumers to spread their messages

quickly to coordinate and take collective actions. Hence, to be in a business, companies need to

inform their customers or rather highlight to them that the product they buy are produced by a

company which cares for them and their environment.

4.3 Extent of CSR Web Reporting

Consistent with other studies, our group also measured the volume of CSR web reporting based

on the number of sentences. The reason being as it is easily identifiable, less subject to inter-

coder variations. Furthermore, this method was used and tested by a number of researchers

previously to be reliable (Nik, Maliah and Siswantoro, 2003).

4.4 Locations of CSR Web Reporting

References to corporate social disclosure in its various forms in both developed and developing

economies are readily available nowadays. These references can be found in a company's

annual report, press releases, media news, academic articles and even political speeches (Singh

& Ahuja, 1983; Teoh & Thong, 1984; Gray, 1987; Maunders, 1987; Mathews, 1993; Perks,

1993). Researchers indicate that corporate social disclosure and reporting are expected to

become increasingly more important in the future. Our objective is to investigate whether

companies emphasise their CSR involvements on their respective website.

5.0 RESEARCH METHODOLOGY

5.1 Sample Selection and Data Collection

Basically, there are 235 companies listed on Second Board of BM. Only 117 of 235 Second

Board Companies listed in the BM were found with online website as of September 2007. It

results in an approximately 50% response rate. The name of companies in the sample are listed

from different industrial sectors of the BM, namely, consumer products, industrial products,

technology, construction, trading/services, properties and plantations as shown in Appendix A

(i). Distribution of the sample of companies according to industrial sector of the BM and their

proportion to the population are shown in Appendix A (ii). Although the total sample size

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represents only 50% of the total number of companies listed on the BM, it can be seen from

Appendix A that the sample is quite well distributed across the industrial sectors. Besides, the

annual reports 2006 of 117 Second Board Companies listed in the BM are studied as well.

Companies that are without an annual report 2006 were removed from the study sample.

5.2 Content Analysis Methodology

As in the case with most studies on social and environmental disclosures, a content analysis

approach is used (see, for example, Abbot and Monsen, 1979; Abu Baker and Naser, 2000;

Andrew, 1989; Belal, 2001; Imam, 2000; Ernst and Ernst, 1978). Content analysis is defined by

Krippendorf (1980, 21) as “a research technique for making replicable and valid inferences

from data according to their context.” Our present study goes beyond those previous studies

which were limited to the analysis of the annual reports (Freedman and Jaggi, 1988; Gray,

Kouhy and Lavers, 1995; Hackston and Milne, 1996; Neu, Wasame and Pedwell, 1998). Rather,

content analysis technique was applied in examining the annual report 2006 and also the online

website of 117 second tier companies listed in the BM. Hughes, Andersen and Golden (2001)

also cited the frequent use of annual reports in CSR disclosure studies. They argued that this is

due to “. . . their wide availability and the perception that this is the medium most often used by

corporations to communicate in a systematic manner with shareholders” (Hughes, Anderson

and Golden, 2001, 224). According to Milne and Adler (1999), the construction of a

categorisation scheme is an essential stage in content analysis research. This involves the

selection and development of categories into which content units can be classified (Tilt, 2000).

The measurement instrument in this study is a modified version from Hackston and Milne’s

(1996) study that contains 17 content categories within five testable dimensions (see Appendix

B). The measurement instrument follows BM’s framework as summarised below:

• Environment: Climate Change, Energy (Renewable Energy, Energy

Efficiency, Biofuel), Waste Management, Biodiversity, and Endangered Wildlife;

• Community: Employee Volunteerism, Education (Schools Adoption

Scheme), Youth Development, Underprivileged, Graduate Employment and Children;

• Marketplace: Green Products, Stakeholder Engagement, Ethical

Procurement, Supplier Management, Vendor Development, Social Branding and

Corporate Governance; and

• Workplace: Employee Involvement, Workplace Diversity, Gender Issues, Human

Capital Development, Quality of Life, Labour Rights, Human Rights and Health &

Safety.

To ensure that the coding process is reliable, definitions of what comprised each category of

CSR reporting were detailed out in a separate sheet. These were drawn from a review of the

literature, notably the works of Williams and Ho (1999) and Hackston and Milne (1996, see

Appendix C). In addition, the same coding rules used by Hackston and Milne (1996) were

adopted in the present study (see Appendix D). These three instruments helped making the

coding process simpler and also reduced much of the subjectivity in deciding what actually

constituted CSR reporting and how to categorise them. The use of these decision categories and

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decision rules improve the reliability of the coding process (Milne and Adler, 1999). Consistent

with other studies, the unit of analysis for the present study was the sentence.

Unerman (2000) argues that the method of measurement is one crucial factor in content analysis

research. Unerman is in favor of using the number of sentences to measure the volume of

disclosure as he claims that this may be done with less use of judgment. Ingram and Frazier

(1980) supported the use of sentences for several reasons. They argue that a sentence is easily

identifiable, less subject to inter-coder variations, and has been selected as an appropriate unit in

similar studies. Hackston and Milne (1996) also attest to the reliability of the sentence as a unit

of analysis. They feel that the use of sentences avoids the problems of allocating a portion of a

page and removes the need to standardise the number of words. Other researchers who support

the use of the number of sentences to measure volume include Milne and Adler (1999) and

Tsang (1998).

6.0 HYPOTHESES

Hypothesis 1

Corporate Social Responsibility Web Reporting in Second Board Companies listed in Bursa

Malaysia is dependent on the industry in which the company operates.

Hypothesis 2

Corporate Social Responsibility Web Reporting in Second Board Companies listed in Bursa

Malaysia is dependent on the firm size.

Hypothesis 3

Corporate Social Responsibility Web Reporting in Second Board Companies listed in Bursa

Malaysia focuses more on Marketplace dimension.

7.0 RESULTS AND DISCUSSION

7.1 Incidence of CSR Web Reporting

Figure 1 and Table 1a summarise the distribution across industrial sectors of Second Board

Companies listed in the BM, the sample (companies with websites), and companies with CSR

reporting in their websites. The table reveals that there are 117 or almost 50% (our sample) of

the companies that have their own websites. However, only 23.1% of these companies in the

sample have some form of CSR reporting in their website either directly or indirectly via their

Annual Reports. This could be due the fact that “CSR is a function of economic wealth” argued

by Eleanor (2003).

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Figure 1

Table 1a

Sample CSR REPORTING BY SECTORS

Profile Population Frequency Frequency %

Industrial Sector

Consumer Products 46 27 5 18.5

Industrial Products 122 57 12 21.1

Construction 13 6 2 33.3

Trading / Services 39 22 7 31.8

Properties 3 0 0 -

Plantation 4 1 0 -

Technology 6 4 1 25.0

Unknown 2

235 117 27 23.1

Hypothesis 1 requires an evaluation of the CSR web reporting in Second Board Companies

against the industrial sectors in which the company operates. The evaluation was carried out

using Chi-Square Test as well as one way ANOVA. The significance values in both tests shown

in Table 1b and Table 1c are more than alpha level (0.05) i.e. 0.841 and 0.850 respectively

indicating that there was no statistical significance in CSR web reporting among the sectors at 5

% confidence level.

Table 1b

Chi-Square TestsChi-Square TestsChi-Square TestsChi-Square Tests

2.058a 5 .841

2.204 5 .820

.680 1 .410

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Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.(2-sided)

6 cells (50.0%) have expected count less than 5. Theminimum expected count is .23.

a.

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Table 1c

7.2 The Effect of Firm Size on CSR Web Reporting

In this section, the sample size of the companies was examined. Firstly, they are differentiated

by their paid-up capital, their revenue and their profit for the year 2006. The correlations test

was conducted. The results of the test as shown in Table 2a revealed that the paid-up capital,

revenue and profit of the company do not have any influence on CSR web reporting of the

Second Board companies. Another test was conducted by combining the paid-up capital,

revenue and profit of the companies. Once more, the significant value of – 0.073 was more than

alpha value of 0.05 (see Table 2b). The result ejected the null hypothesis and concluded that

there was no statistical significant difference between the size of the companies and CSR web

reporting. These results reveal that CSR web reporting was not influenced by the size of the

firm. Therefore, Hypothesis 2 – CSR web reporting in Second Board Companies is dependent

on the firm size is false statistically at confidence level 0.05.

Table 2a

Correlations

1.000 -.055 .031 -.121

. .553 .742 .195

117 117 117 117

-.055 1.000 .127 .455 **

.553 . .173 .000

117 117 117 117

.031 .127 1.000 .070

.742 .173 . .451

117 117 117 117

-.121 .455 ** .070 1.000

.195 .000 .451 .

117 117 117 117

Pearson Correlation

Sig. (2-tailed)

N

Pearson Correlation

Sig. (2-tailed)

N

Pearson Correlation

Sig. (2-tailed)

N

Pearson Correlation

Sig. (2-tailed)

N

CSRR

REVENUE

CAPITAL

PROFIT

CSRR REVENUE CAPITAL PROFIT

Correlation is significant at the 0.01 level (2-tailed). **.

ANOVA

CSRR

.365 5 7.308E-02 .398 .850

20.404 111 .184

20.769 116

Between Groups

Within Groups

Total

Sum of

Squares df F Sig. Mean Square

98

Table 2b

7.3 Content-Category Themes of CSR Web Reporting

Nik Nazli (2003)’s approach was followed in distinguishing the four waves of CSR themes. The

detail breakdown of the number of companies in the sample making CSR web reporting in

various content category themes by industrial sectors is exhibited in Table 3a. On the whole, it

can be seen from the table that community involvement tops the list followed by environment.

Figure 2 and Table 3b disapprove our Hypothesis 3 (CSR web reporting in Second Board

companies focuses more on Marketplace dimension). Marketplace is the least favourable theme

among the four categories.

Table 3a

Industrial

Sector

Environment Community Marketplace Workplace No CSR

Reporting

Total

Consumer 5 22 27

Industrial 5 5 1 1 45 57

Construction 1 1 4 6

Trading /

Services

4 3 15 22

Plantation 1 1

Technology 1 3 4

Total 6 15 1 5 90 117

% of Total 5.1% 12.8 % 0.9% 4.3% 76.9% 100%

Figure 2

0

2

4

6

8

10

12

14

16

Environment Community Marketplace Workplace

6

15

1

5 Total

Correlations

1.000 -.073

. .432

117 117

-.073 1.000

.432 .

117 117

Pearson Correlation

Sig. (2-tailed)

N

Pearson Correlation

Sig. (2-tailed)

N

CSRR

SIZE

CSRR SIZE

99

Table 3b

Chi-Square Tests

117.000a 4 .000

126.408 4 .000

112.947 1 .000

117

Pearson Chi-Square

Likelihood Ratio

Linear-by-Linear

Association

N of Valid Cases

Value df

Asymp. Sig.

(2-sided)

7 cells (70.0%) have expected count less than 5. The

minimum expected count is .23.

a.

The amount of CSR reports was measured by the number of sentences. Figure 3 demonstrates

that majority of the companies have less than 20 sentences in their reports. Figure 4 further

indicates that most of the CSR reporting was found in the Annual Report under the Chairman’s

statement.

Figure 3: Amount of CSR reporting – Number of sentences

02468

10

1 - 10 10 - 20 20 - 50 50 -100 >100

108

4 4

1

1 - 10 10 - 20 20 - 50

Figure 4

7.4 Summary of the Results of Hypotheses Testing

Hypothesis Statistical Results

Test P value α = 0.05 Reject/Accept

Hypothesis 1 Chi-Square 0.841 Reject H0 - Not significant

Hypothesis 2 Correlations 0.432 Reject H0 - Not significant

Hypothesis 3 Chi-Square 0.000 Accept H0 - Significant

0

5

10

15

Charimans Operation review

Corp Govn Vision & Mission

Others Co Websites

13

1 1 1

65

Location of CSR reports

CSR Reporting

100

8.0 SUMMARY AND CONCLUSIONS

This paper examines the incidence of CSR web reporting of 117 of 235 Second Board

companies listed in the BM.

This study is certainly subject to several limitations. Firstly, the study relates to the annual

reports of a single year only, which was 2006. Besides, some of the companies’ website was not

being updated. Secondly, owing to the small sample and the minimal amount of CSR web

reporting, it was not possible to run the statistical tests accurately in examining if there were

significant differences in the nature and extent of CSR web reporting across industrial sectors.

Thirdly, the discrepancy in the population of Second Board companies between the newspaper

and website which resulted that the population from the website was selected i.e. 235 instead of

241 Second Board companies listed in the BM. One possible reason to explain this is the

possible upgrade of some Second Board companies to the Main Board. Finally, due to the

content analysis method applied in this study, there is some amount of subjectivity. This

limitation, however, applies to all content analysis studies and has been noted in previous

studies (Gamble, 1996).

The findings have quite a few implications too. It appears that without some form of regulatory

intervention, reliance on voluntary reporting alone is unlikely to result in either a high quality of

reporting or sufficient levels of reporting. From 14th December 2006, all PLCs are encouraged

to include a statement of their CSR performance in their annual reports as a consequence of

changes announced in the 2007 Budget Statement in September last year. CSR reporting will be

mandatory for companies with financial years ending on or after December 31st 2007 but

voluntary reporting is being promoted by BM before the mandatory period begins. As such, it is

perceived that the absence of CSR reporting standards in Malaysia prior to this perhaps resulted

in the lack of CSR reporting of the sample. By making CSR reporting mandatory, it benefits the

stakeholders as the annual reports and website will be more consistent and comparable. At

present, investors often have difficulty in determining if a public listed company is socially

responsible.

To strengthen the findings of the present study, some areas for improvements maybe undertaken

in future studies. First, a longitudinal study may provide further insights into some reporting

patterns, if any. Second, the research can be replicated with a bigger sample size to enable a

more accurate application of the statistical tests in identifying the differences across industrial

sectors. Third, it is recommended that future researchers use WordStat5.1 which is the software

for Content Analysis for a much reliable and professional result. On top of that, different

research methods can also be applied to determine if the previously suggested frameworks

explained the CSR reporting practices of Malaysian public listed companies. Fourth, surveys

and interviews may be conducted with those who prepare annual reports and website to elicit

their views on the reasons for companies not reporting CSR information or to see their

influences on companies’ decisions to report or not to report CSR information in the two

mentioned locations. Lastly, research determining whether stakeholders need CSR information

would provide useful insights on the necessity of CSR reporting in the annual reports and

website.

101

APPENDICES

Appendix A (i) – List of the sample of 117 2nd

Board Companies according to Industrial Sector of the BM

No 2nd Board Company Name Industrial

Sector

1 ABRIC BHD IP

2 ADVANCED PACKAGING TECHNOLOGY (M) BHD

IP

3 ARK RESOURCES BHD C

4 ATLAN HOLDINGS BHD IP

5 ASIA BRANDS CORPORATION BHD

CP

6 AUTOAIR HOLDINGS BHD IP

7 AWC FACILITY SOLUTIONS BHD

TS

8 B.I.G. INDUSTRIES BHD IP

9 BASWELL RESOURCES BHD CP

10 CAM RESOURCES BHD CP

11 CCK CONSOLIDATED HOLDINGS BHD

CP

12 CENTRAL INDUSTRIAL CORPORATION BHD

IP

13 CENTURY LOGISTICS HOLDINGS BHD

TS

14 CHANGHUAT CORPORATION BHD

IP

15 CHASE PERDANA BHD C

16 CHEE WAH CORPORATION BHD

CP

17 CHIN FOH BHD TS

18 CHUAN HUAT RESOURCES BHD

IP

19 CME GROUP BHD TS

20 CN ASIA CORPORATION BHD

IP

21 CNLT (FAR EAST) BHD IP

22 CONCRETE ENGINEERING PRODUCTS BHD

IP

23 DATAPREP HOLDINGS BHD T

24 EDEN INC BHD TS

25 EG INDUSTRIES BHD IP

26 EMICO HOLDINGS BHD CP

27 EUROSPAN HOLDINGS BHD CP

28 FARM'S BEST BHD CP

29 FEDERAL FURNITURE HOLDINGS (M) BHD

CP

30 FORMIS RESOURCES BHD T

31 FSBM HOLDINGS BHD TS

32 FURNIWEB INDUSTRIAL PRODUCTS BHD

IP

33 FUTUTECH BHD IP

34 GADANG HOLDINGS BHD C

35 GOLDEN FRONTIER BHD IP

36 GOODWAY INTEGRATED INDUSTRIES BHD

IP

37 GSB GROUP BHD IP

38 HAI-O ENTERPRISE BHD TS

39 HAISAN RESOURCES BHD TS

40 HARVEST COURT INDUSTRIES BHD

IP

41 HEXAGON HOLDINGS BHD TS

42 HI-CITY BIOSCIENCE GROUP BHD

CP

43 HING YIAP KNITTING INDUSTRIES BHD

CP

44 HUAT LAI RESOURCES BHD CP

45 HUNZA CONSOLIDATION BHD

CP

46 HWA TAI INDUSTRIES BHD CP

47 INDUSTRONICS BHD T

48 JASA KITA BHD IP

49 JOTECH HOLDINGS BHD IP

50 KAWAN FOOD BHD CP

51 KEIN HING INTERNATIONAL BHD

IP

52 KEJURUTERAAN SAMUDRA TIMUR BHD

TS

53 KESM INDUSTRIES BHD T

54 KHIND HOLDINGS BHD CP

55 KOMARKCORP BHD IP

56 KOSMO TECHNOLOGY INDUSTRIAL BHD

IP

57 KUANTAN FLOUR MILLS BHD

CP

58 KUMPULAN BELTON BHD IP

59 KUMPULAN H&L HIGH-TECH BHD

IP

60 KUMPULAN JETSON BHD C

61 LATEXX PARTNERS BHD IP

62 LAY HONG BHD CP

63 LFE CORPORATION BHD TS

64 LIMAHSOON BHD IP

65 LTKM BHD CP

66 LYSAGHT GALVANIZED STEEL BHD

IP

67 MAGNA PRIMA BHD C

68 MALAYSIA PACKAGING INDUSTRY BHD

IP

69 MESB BHD TS

70 METAL RECLAMATION BHD IP

71 METECH GROUP BHD IP

72 MITHRIL BHD IP

73 MULTI-USAGE HOLDINGS BHD

IP

74 NI HSIN RESOURCES BHD CP

75 OCI BHD IP

76 PAHANCO CORPORATION BHD

IP

77 PARADE SEASON BHD IP

78 PARAGON UNION BHD CP

79 PELANGI PUBLISHING GROUP BHD

IP

80 PENSONIC HOLDINGS BHD IP

81 POLY GLASS FIBRE (M) BHD IP

82 PREMIUM NUTRIENTS BHD IP

83 PROLEXUS BHD CP

84 PUBLIC PACKAGES HOLDINGS BHD

IP

85 RALCO CORPORATION BHD IP

86 RAMUNIA HOLDINGS BHD TS

87 RHYTHM CONSOLIDATED BHD

TS

102

88 SAAG CONSOLIDATED (M) BHD

TS

89 SARAWAK CONCRETE INDUSTRIES BHD

IP

90 SATANG HOLDING BHD TS

91 SCIENTEX PACKAGING BHD IP

92 SDKM FIBRES, WIRES & CABLES BHD

IP

93 SEACERA TILES BHD IP

94 SELOGA HOLDINGS BHD CP

95 SHH RESOURCES HOLDINGS BHD

CP

96 SKB SHUTTERS CORPORATION BHD

IP

97 SPRITZER BHD CP

98 STAMFORD COLLEGE BHD TS

99 SUNCHIRIN INDUSTRIES (M) BHD

IP

100 TAI KWONG YOKOHAMA BHD

IP

101 TAKASO RESOURCES BHD CP

102 TAMADAM BONDED WAREHOUSE BHD

TS

103 TANAH EMAS CORPORATION BHD

P

104 TIEN WAH PRESS IP

HOLDINGS BHD

105 TOMYPAK HOLDINGS BHD IP

106 TOYO INK GROUP BHD IP

107 TOYOCHEM CORPORATION BHD

IP

108 TRANSOCEAN HOLDINGS BHD

TS

109 UMS HOLDINGS BHD TS

110 UNITED BINTANG BHD IP

111 VTI VINTAGE BHD IP

112 WONG ENGINEERING CORPORATION BHD

IP

113 WOODLANDOR HOLDINGS BHD

IP

114 WWE HOLDINGS BHD TS

115 YIKON CORPORATION BHD CP

116 YINSON HOLDINGS BHD TS

117 ZECON BHD C

Notes: Consumer Products – CP Industrial Products – IP Technology – T Construction – C Trading / Services – TS Properties – P Plantations - PT

Appendix A (ii) – Distribution of the sample of 2nd

Board Companies according to Industrial Sector

of the BM and their Proportion to the Population

INDUSTRIAL SECTOR POPULATION SAMPLE SAMPLE AS A % OF POPULATION

Consumer Products 46 27 59%

Industrial Products 122 57 47%

Technology 6 4 67%

Construction 13 6 46%

Trading / Services 39 22 56%

Properties 3 1 33%

Plantation 4 0 0

Unknown 2 0 0

TTOOTTAALL 223355 111177 5500%%

103

Appendix B - Hackston and Milne’s (1996) study that contains 17 content categories within five

testable dimensions

Appendix C Categories and Decision Rules for Environmental and Social Accounting Disclosure by Companies A.1 Category One – Environment A.1.1 General Environmental Considerations Statement of the corporation’s business operations on environmental pollution pertaining to Noise Air Water Visual quality A.1.2 Environmental Pollution Pollution control in the conduct of business operations, capital operating and research and

development expenditures for pollution abasement;

Statements indicating that pollution laws and regulations are non-polluting or that they are in compliance with pollution laws and regulations;

Statements indicating that pollution from operations has been or will be reduced; Prevention or repair of damage to the environment resulting from processing or natural

resources, e.g., recycling glass, metal, oil, water and paper; Using recycle materials; Efficiently using materials resources in the manufacturing process; Supporting anti-litter campaigns; Receiving an award relating to the company’s environmental programs or policies; Preventing waste.

104

A.1.3 Environmental Aesthetics Designing facilities that are harmonious with the environment; Contributions in terms of cash or art/sculptures to beautify the environment; Restoring historical buildings and structures; Landscaping. Corporate Social Responsibility Disclosure in Malaysia 31 A.1.4 Environmental Policy Actual statement of policy; Statements of formal intentions; Statements indicating that the company will undertake certain measures to curb environmental

pollution and other such damage of what the company does. A.1.5 Environmental Audit Reference to environmental review, scoping, audit, and assessment including independent

attestation. A.1.6 Environmental – Product and Process-Related Wastage(s); Packaging; Recycling; Product and product development; Land contamination and mediation. A.1.7 Environmental – Financially Related Data Reference to financial/economic impact; Investment and investment appraisal; Discussion of areas with financial/economic impact; Discussion of environmental-economic interaction. A.1.8 Sustainability Any mention of sustainability; Any mention of sustainable development. A.1.9 Environmental-Other Involvement in schemes; Undertaking environmental impact studies to monitor the company’s impact on the

environment; Wildlife conservation; Protection of the environment, e.g., pest controls; Environment education; (Note: All the classifications are undertaken with care so as to ensure that the disclosure is not part of the business (e.g., waste disposal or environmental technology). IIUM Journal of Economics & Management 11, no.1 (2003) 32 A.2.0 Energy Conservation of energy in the conduct of business operations; Using energy more efficiently during the manufacturing process; Utilizing waste material for energy production; Disclosing energy savings resulting from product recycling; Discussing the company’s effort to reduce energy consumption; Disclosing increased energy efficiency of products; Research aimed at improving energy efficiency of products; Receiving an award for an energy conservation programme; Voicing the company’s concern about the energy shortage;

105

Disclosing the company’s energy polices. Note: care in classifying is taken if it is part of the business (e.g., oil exploration companies) A.2 Category Two – Community Donations of cash, products or employee services to support established community activities,

events, organisations, education and the arts; IIUM Journal of Economics & Management 11, no.1 (2003) 36

Summer or part-time employment of students or the disabled; Sponsoring public health or recreational projects; Aiding medical research; Sponsoring educational conferences, seminars or art exhibits; Funding scholarship programs or activities; Other special community-related activities, e.g., opening the company’s facilities to the

public; Supporting national pride/government-sponsored campaigns; Supporting the development of local industries or community programs and activities. A.3 Category Three – Marketplace A.3.1 Product Development Information on developments related to the company’s products, including its packaging, e.g.,

making containers reusable; The amount/%age figures of research and development expenditure and/or its

benefits; Information on any research project set up by the company to improve its products in any

way. A.3.2 Product Safety Disclosing that products meet applicable safety standards; Making products safer for consumers; Conducting safety research on the company’s products; Disclosing improved or more sanitary procedures in the processing and preparation of products; Information on the safety of the firm’s product. A.3.3 Product Quality Information on the quality of the firm’s products as reflected in the prizes/awards received; Verifiable information that the quality of the firm’s products has increased (e.g. ISO9000). A.3.4 Consumer Information Disclosing of customer safety practices; Customer complaints; Specific consumer relations (over and beyond “our duty to the consumer”); Provision for the disabled, aged, etc., customers; Provision for difficult-to-reach customers. A.4 Category Four – Workplace A.4.1 Employee Health and Safety Reducing or eliminating pollutants, irritants, or hazards in the work environment; Promoting employee safety and physical or mental health; Disclosing accident statistics; Compliance with health and safety standards and regulations; Receiving a health and safety award; Establishment of a safety department/committee/ policy;

106

Conducting research to improve work safety; Information/education/training of employees on safety and health related matters; Providing low cost health care for employees; Reference to health and safety law and/or inspectorate. A.4.2 Employee Training Training employee through in-house programs; Corporate Social Responsibility Disclosure in Malaysia 33 Giving financial assistance to employees in educational institutions; continuing education

courses; Establishing training centres. A.4.3 Employee Assistance/Benefits Providing assistance or guidance to employees who are in the process of retiring or who have

been made redundant; Providing staff accommodation or ownership schemes; Provision of low health care services; Providing recreational activities/facilities. A.4.4 Employee Remuneration Providing amount and/or %age figures for salaries, wages. PAYE taxes super-annuation; Any policy/objective/reason for the company’s remuneration package/schemes. A.4.5 Employee Profiles Providing the number of employees in the company and/or at each branch/subsidiary; Providing the occupations/managerial levels involved; Providing the disposition of staff – where the staff are stationed and the number involved; Providing statistics on the number of staff members, the length of service in the company and

their age groups; Providing per employee statistics, e.g., asset per employee and sales per employee; Providing detailed information on the qualifications and experience of employees recruited; Providing the geographical disposition of staff. A.4.6 Employee Share Purchase Schemes Providing information on the existence of, or the amount and value of shares offered to

employees under a share purchase scheme or pension program; Providing any other profit-sharing schemes. A.4.7 Employee Morale and Relations Providing information on the company/management’s relationships with the employees, and

efforts to improve job satisfaction and employee motivation; IIUM Journal of Economics & Management 11, no.1 (2003) 34

Providing information on the stability of the worker’s jobs and the company’s future. Providing information on the availability of a separate employee report; Providing information about any award for effective communication with employees; Providing information about communication with employees on management styles and

management programs which may directly affect the employees. A.4.8 Industrial Relations Reporting on the company’s relationship with trade union and/or workers; Reporting on any strikes, industrial actions/ activities and the resultant losses in terms of time and

productivity; Providing information on how industrial action was reduced/negotiated. A.4.9 Employee – Other Employment of minorities or women;

107

Recruiting or employing minorities and/or women; Disclosing the %age or number of minority and/or women employees in the workforce and/or in

the various managerial levels; Establishing goals for minority representation in the workforce; Program for the advancement of minorities in the workplace; Employment of other special interest groups, e.g., the handicapped, ex-convicts or former drug

addicts; Disclosures about internal advancement statistics; Proposals, plans or initiated actions for equal opportunity, racial equality and sexual equality; Improving the general working conditions – both in the factories and in the office; Information on the re-organisation of the company/ divisions/branches, which affect the staff in

any way; The closing down of any part of the organisation, the resultant redundancies created, and any

relocation/ retraining effort, made by the company to retain staff; Information and statistics on employee turnover Corporate Social Responsibility Disclosure in Malaysia 35 Information about support for day-care, maternity and paternity leaves. Notes: Adapted and modified from Hackston and Milne (1996) and Williams and Ho (1999). Appendix D Decision Rules for Social Disclosures Discussions of directors’ activities are not to be included as a discussion on employees. All sponsorship activity is to be included no matter how much it is advertising All disclosures must be specifically stated and they cannot be implied. Good/neutral/bad classifications to be determined from perspectives of the stakeholder groups

involved. If any sentence has more than one possible classification; the sentence should be classified as

the activity most emphasized in the sentence. Tables (monetary and non-monetary), which provide information, which is on the checklist, should

be interpreted as one line equals one sentence and classified accordingly. Innovations in products or service should not be included unless they are beyond what is

necessary to compete in the market place or attract business. Any discussion of pension funds or employee share schemes would be classified as good news

unless it was clearly to the contrary, e.g., that the schemes had been scrapped. Corporate Social Responsibility Disclosure in Malaysia 37

Any disclosure which is repeated shall be recorded as a CSR sentence each time it is discussed. Discussions relating to the quality of goods and services will not be a CSR unless it contains

notice of a verifiable change in quality, e.g., accreditation to the International Standards Organisation ISO 9000 quality series standard.

Source: Hackston and Milne (1996)

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