The effects of business ethics and corporate social responsibility on intellectual capital voluntary disclosure

Abstract

PurposeThis study aims to examine the potential effect that business ethics (BE) in general and corporate social responsibility (CSR) more specifically can exert on the voluntary disclosure (VD) of intellectual capital (IC) for the ethically most engaged firms in the world.Design/methodology/approachThe research design is based on an inductive approach. As part of the global quantitative investigation, the authors have analyzed the impact of BE and CSR on the transparent communication of the IC. The data under analysis have been investigated using multiple linear regression.FindingsBased on a sample of 83 enterprises emerging as the most ethical companies in the world, the results have revealed that the adoption of ethical and socially responsible approach is positively associated with the extent of VD about IC. This finding may help attenuating the asymmetry of information and the conflict of interest potentially arising with corporate partners. Hence, IC-VD may stand as an evidence of ethical and socially responsible behaviors.Practical implicationsGlobal and national regulators and policymakers can be involved by these results when setting social reporting standards because they suggest that institutional and/or cultural factors affect top management's social reporting behavior in the publication of the IC information.Social implicationsDirect and indirect stakeholders, if supported by ethical and socially responsible behaviors of the company, could assess more in detail the quality of the disclosed information concerning the IC.Originality/valueMost of the studies that have been conducted in this field have examined the effect of BE and CSR on the firm's overall transparency, neglecting their potential effect on IC disclosure. This study is designed to fill in this gap through testing the impact of ethical and socially responsible approaches specifically on IC-VD.

Social and ethical practices and firm value: the moderating effect of green innovation: evidence from international ESG data

“…All this improves the competitive position of the company and manages the uncertainty of the market. Besides, these studies show that practices related to ethical behavior are effective ways for companies to improve the environment and restore investor confidence in times of crisis (Giannarakis and Theotokas, 2011;Cherian and Jacob, 2012;Rossi et al, 2021). It is, therefore, necessary that the commitment to business ethics helps to maximize the expected profit, which determines the price of securities.…”

Managerial ability and intellectual capital disclosure

“…Companies have been generating value not only from securities and financial assets but also from intangible assets, such as the skills of employees (human capital), technological innovation and breakthroughs (structural capital) and relationships with customers (direct relational capital), all of which are forms of potential intellectual capital (IC) (Su, 2014;Cruz-Gonz alez et al, 2014;Rossi et al, 2021). The existing literature suggests that IC plays a significant role in improving the efficiency of both capital and labor markets (Petty and Guthrie, 2000;Bismuth and Tojo, 2008) and increasing the performance and wealth of organizations (Dumay and Roslender, 2013;Muttakin et al, 2015).…”

The effect of corporate social responsibility practices on tax avoidance: an empirical study in the French context

“…An investigation has been grounded on the Ethisphere Institute database, which considers more than 100 criteria; the most important are social responsibility, good governance, environmental impact, implementation of code of good behavior, commitment of the direction to questions of ethics and CSR, setting up of internal monitoring indicators, citizen investment and so on (it also considers negative criteria, such as the existence of disputes or infringements to sector regulations). This database provides a global overview, and the list of elected representatives reveals a real geographical diversity with several companies located outside the USA, such as the UK, Australia, Sweden, Germany, India, Guatemala, Poland, Switzerland, Saudi Arabia, Portugal and Belgium (Rossi et al , 2020b; Rossi et al , 2021).…”