Effect of Financial Information and Corporate Social Responsibility Disclosure on Investment Decision: Evidence from an Experimental Study

Rokhayati, Hijroh; Nahartyo, Ertambang; Haryono, H

doi:10.22452/ajba.vol12no1.5

Cited by 10 publications

(5 citation statements)

References 58 publications

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“…Furthermore, the complementary measurement is more effective to drive managers to make CSR decisions (Merriman et al, 2016). The effectiveness of information with a prevention frame increases CSR investment (Rokhayati et al, 2019). This study predicts managers will be more motivated to make CSR investment decisions when performance measurements are complementary instead of substitute.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 85%

The effect of regulatory focus and performance measurement on corporate social responsibility investment decisions

Rokhayati

Sholihin

Supriyadi

et al. 2021

SRJ

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Purpose This paper aims to investigate the relationship between regulatory focus, performance measurement and corporate social responsibility (CSR) investment decisions. Design/methodology/approach Using an experimental method with a 2 × 2 between-subjects factorial design involving 144 participants, the data were analyzed using t-test and contrast test. In the experiment, the authors assigned participants into prevention focus or promotion focus group and complementary performance measurement or substitute performance measurement condition. Findings The results show that CSR investment is more preferable for managers in prevention focus instead of those in promotion focus group. Additionally, CSR investment is more preferable for managers in complementary performance measurement condition compared to those in substitute performance measurement condition. This study also provides evidence that the greatest CSR investment is reached when managers are in both prevention focus group and complementary performance measurement conditions. Practical implications Companies need to activate the prevention focus for managers to motivate CSR investment. Additionally, companies need to use complementary performance measurements, which consist of CSR measurement and financial measurements. Originality/value CSR research is dominated by theories explaining the external models which trigger companies to perform CSR. Existing research related to the internal models is limited to psychological aspects that are not directly related to company performance. This study investigates the motivational attributes that have a direct and strong influence on managers behavior. This research shows that regulatory focus is better at predicting CSR investment and is more motivational for individuals to perform well at work.

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Section: Literature Review and Hypothesis Developmentmentioning

confidence: 85%

The effect of regulatory focus and performance measurement on corporate social responsibility investment decisions

Rokhayati

Sholihin

Supriyadi

et al. 2021

SRJ

Self Cite

View full text Add to dashboard Cite

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“…According to the position of the theory, the quality of the information provided and distributed to stakeholders provide positive information about the organization, and elicit positive response from the stakeholders (Uyar et al, 2021;Husnaint & Basuki, 2020;Endiana et al, 2022). In line with this, one of the more effective ways for organization to create value for itself, and build the trust of stakeholders is through sustainability reporting practices (Rokhayati et al, 2019;Chen et al, 2021). Thus organization through full and responsive disclosure can bridge the expectations gap of the stakeholders.…”

Section: Stakeholder Theorymentioning

confidence: 99%

Bridging Stakeholders’ Expectations Gap: The Role of Sustainability Reporting of Listed Firms in Nigeria

Omotilewa,

Akintoye,

Adegbie

et al. 2024

EJBIR

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Studies have shown that expectation gaps among stakeholders have resulted into information asymmetry. In view of this, this study investigated the role of sustainability reporting in bridging the stakeholders’ expectation gaps in Nigeria. The study adopted cross sectional survey research design, and used online structured questionnaire to collect primary data. 150 copies of questionnaire were distributed, out of which 138 copies were returned. Data obtained from the respondent were analysed using descriptive and inferential statistics. The regression result from hypothesis one revealed that sustainability reporting practices has significant role in improving the disclosure of information regarding business activities in Nigeria (Adj. R2 =0.545; F = 58. 176; p =0.001<0.05 ), while that of hypothesis two showed that sustainability reporting practices is an effective tool for effectively bridging the gaps in stakeholder expectations within Nigerian businesses ( Adj.R2 =0.565; F = 75.112; p = 0.001 <0.05 ).The regression result from hypothesis one revealed that sustainability reporting practices has significant role in improving the disclosure of information regarding business activities in Nigeria, while that of hypothesis two showed that sustainability reporting practices is an effective tool for effectively bridging the gaps in stakeholder expectations within Nigerian businesses. Hence, the study concluded that adoption of sustainability reporting can significantly strengthen the trust of the stakeholders thereby contributing to bridge their expectation’s gap. The study recommended that corporate organizations should regard sustainability reporting as a strategic instrument for promoting transparency and accountability.

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“…According to signal theory, investors will respond to company announcements by buying shares if they see excellent potential. One of the more effective ways for companies to notify that the company can create and maximize investor wealth is through SRD [53,54]. Thus, companies use their activities as a positive signal to stakeholders [13,14,26,48].…”

Section: Signaling Theorymentioning

confidence: 99%

Bridging the Gap between Sustainability Disclosure and Firm Performance in Indonesian Firms: The Moderating Effect of the Family Firm

2022

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This study investigates the impact of sustainability reporting on firm performance. This paper also examines the moderating effect of family ownership on the relationship between sustainability disclosure and firm performance. The research sample consists of 850 primary and secondary sector companies listed on the Indonesian stock exchange between 2014 and 2020. This study generates its results using a panel model with Generalized Least Square (GLS) regression. This study concludes that sustainability disclosure has a positive impact on the financial performance of market- and accounting-based companies. Additionally, family businesses strengthen the link between sustainability disclosure and firm performance. The findings of this paper provide unique and useful information for company stakeholders and managers seeking to improve sustainability disclosure for optimal performance. In addition, it can be advantageous for the policymaker to establish the policy. This study contributes to the literature by providing comprehensive examination of the relationship between sustainability disclosure and company performance.

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Effect of Financial Information and Corporate Social Responsibility Disclosure on Investment Decision: Evidence from an Experimental Study

Cited by 10 publications

References 58 publications

The effect of regulatory focus and performance measurement on corporate social responsibility investment decisions

The effect of regulatory focus and performance measurement on corporate social responsibility investment decisions

Bridging Stakeholders’ Expectations Gap: The Role of Sustainability Reporting of Listed Firms in Nigeria

Bridging the Gap between Sustainability Disclosure and Firm Performance in Indonesian Firms: The Moderating Effect of the Family Firm

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