Social and environmental accounting as symbolic and substantive means of legitimation: The case of HIV/AIDS reporting in South Africa

Abstract

We develop an interpretive framework which combines Suchman's (1995) work on the dynamics of organisational legitimacy and Ashforth and Gibbs ' (1990) concepts of symbolic and substantive management to investigate how and why public corporations rely on symbolic and substantive social disclosures. We apply this framework to the case of the HIV/AIDS health crisis in South Africa (SA) and examine the corporate disclosure behaviour of a sample of 75 SA-listed corporations from 2003 to 2009. We use content analysis procedures to codify the disclosures and devise a disclosure index based on the Global Reporting Initiative guidelines on HIV/AIDS to assess whether corporations have adopted a substantive management strategy. Our findings suggest that public corporations use a combination of substantive and symbolic disclosures in a bid to seek specific forms of moral legitimacy (structural, procedural, and consequential) and pragmatic legitimacy (dispositional, influence, and exchange). Our analysis reveals that the mix of substantive and symbolic disclosures is altered as a result of changes in stakeholder salience, societal attitudes and the corporation's current 'state' of legitimacy. Overall, the findings demonstrate that our analytical framework is useful in understanding how substantive and/or symbolic disclosures could be relied upon to achieve specific types of organisational legitimacy.

Community disclosures in a developing country: insights from a neo-pluralist perspective

“…A neo-pluralist perspective to the study of CSD In spite of the early exhortations by Gray et al (1995), a multi-theoretical perspective to the study of CSD has only started to emerge in the literature (Chen and Roberts, 2010;Mahadeo et al, 2011;Merk-Davies and Brennan, 2011;Ntim and Soobaroyen, 2013). For example, Chen and Roberts (2010) analyse the conceptual overlaps between legitimacy, stakeholder, resource dependence and institutional theories and argue that a multi-theoretical view of the CSD can provide a better understanding of the relationship between organisation and society, thereby addressing an inherent lack of precision and vagueness as to how the process by legitimacy is achieved.…”

“…For example, Chen and Roberts (2010) analyse the conceptual overlaps between legitimacy, stakeholder, resource dependence and institutional theories and argue that a multi-theoretical view of the CSD can provide a better understanding of the relationship between organisation and society, thereby addressing an inherent lack of precision and vagueness as to how the process by legitimacy is achieved. Relatedly, by relying on Suchman's (1995) work on the different types and dynamics of legitimacy and legitimation, Soobaroyen and Ntim (2013) argue that stakeholder management is akin to the process of achieving or maintaining pragmatic legitimacy by way of meeting the expectations of its most immediate audiences (exchange legitimacy), by demonstrating an organizational responsiveness to a given stakeholder issue (influence legitimacy), and/or by signaling its agreement and commitment to a set of values shared by a given audience (e.g. local community, referred to as dispositional legitimacy).…”

“…multinationals, foreign investors, international agencies, donors and buyers) who are the 'relevant publics' being 'targeted' rather than the local stakeholders and governmental institutions. In this regard, CSD are seen to be less concerned with meeting local demands for social accountability towards, and engagement with, community actors, and more imbued with impression management features such as symbolic management and rhetorical manipulation (Merkl-Davies and Brennan, 2007;Soobaroyen and Ntim, 2013) aimed at a so-called 'sophisticated' audience located away from the developing country. At the same time, Belal et al (2013) does recently acknowledge that specific local economic, political and social factors may have a predominant effect on corporate attitudes towards social disclosure practices.…”

Institutional pluralism, two publics theory and performance reporting practices in Zambia’s health sector

“…The influence of supranational institutions has equally been reported in the Pacific Islands such as Fiji where, for instance, new accounting and managerial technologies were imposed from outside constituencies but accommodated by internal management actors Sharma and Lawrence, 2005;2009). In many instances, such external tools and practices were adopted by governments in EEs in a more symbolic than substantive manner for purposes of maintaining legitimacy with funding institutions (Goddard and Assad, 2006;Mimba et al, 2013;Soobaroyen and Ntim, 2013;van Helden and Uddin, 2016). Under such circumstances, the adoption and implementation of accounting reforms based on external rationales reproduced an alien hegemony that did not increase local autonomy, democracy and accountability (Hopper et al, 2016).…”

“…Many public services in EEs depend on external funding and cannot ignore the institutional and administrative structures emerging from the providers of funding (Hopper et al, 2009). Funding and accounting agreements in such pluralistic environments often entail a restructuring in governance mechanisms and bring financial technologies that at times may not be conversant to EEs' practices but may reaffirm the expertise, legitimacy and dominance of external funding institutions (Goddard and Assad, 2006;Neu et al, 2006;Soobaroyen and Ntim, 2013).…”