NOTHING TO REPORT? MOTIVATIONS FOR NON-DISCLOSURE OF SOCIAL ISSUES BY INDONESIAN LISTED COMPANIES

Authors

  • Fitra Roman Cahaya Curtin University of Technology
  • Stacey A Porter Curtin University of Technology
  • Alistair M Brown Curtin University of Technology

Abstract

A study based on the extent of voluntary social disclosure practices of Indonesian listed entities using Global Reporting Initiatives as a simplified social disclosure index found that all Jakarta Stock Exchange listed entities voluntarily disclose some social information in their annual reports, but at a low level (14.15%). Stakeholder theory partially explains the disclosures but does not explain why some issues such as Child Labour, Forced and Compulsory Labour, Bribery and Corruption and Political Contributions are not disclosed by any listed companies. This paper examines the motivations for these non-disclosures and suggests that one of the more likely reasons that companies do not disclose certain items is to avoid scrutiny, particularly on issues where they are not performing or where it is evident that they are in breach of government regulations.

References

Adams, C. (2004) The ethical, social & environmental reporting: Performance portrayal gap. Accounting, Auditing & Accountability Journal, 17 (5) pp 731-757.

Adams, C., Hill, W. and Roberts, C. (1998) Corporate social reporting practises in Western Europe: Legitimating corporate behaviour The British Accounting Review, 30 (1) pp 1-21.

Ali, N. (2006) Pemerintahan (berbasis) antikorupsi. Retrieved: 2 October 2006 from www.suaramerdeka.com/harian/0601/17/opi4.htm.

Ardianto, E. (2003) Komunikasi iklan di era multikrisis. Retrieved: 5 October 2006 from www.pikiran-rakyat.com/cetak/0603/23/0801.htm.

Bank Dunia cekal perusahaan Indonesia (2006). Retrieved: 23 May 2006 from www.republika.co.id/koran_detail.aspid=243492&kat_id=3.

Bank Mandiri (2006) Cara mudah dan aman menggunakan SMS banking Mandiri. Retrieved: 6October2006fromwww.bankmandiri.co.id/article/437033778214.asp?article_id=437033778214.

BAPEPAM (2006) Retrieved: 13 January 2006 from http://bapepam.go.id.

Belal, A. (2001) A study of corporate social disclosure in Bangladesh. Managerial Auditing Journal, 6 (5) pp 274-289.

Booth, A. (1999) The social impact of the Asian crisis: What do we know two years on Asian-Pacific Economic Literature, 13 (2) pp 16-29.

Brammer, S. and Pavelin, S. (2004) Voluntary social disclosures by large UK companies. Business Ethics: A European Review, 13 (2/3) pp 86-99.

Brown, A., Tower, G. and Taplin, R. (2004) A study of the provision of natural environmental disclosures in the annual reports of Pacific Island countries' entities and user/preparer needs. In Karim, E. and Rutledge, R. (Eds) Environmental disclosure practices and financial performance. Praeger Publishers, Westport, CT. 21-48.

Brown, N. and Deegan, C. (1998) The public disclosure of environmental performance information: A dual test of media agenda setting theory and legitimacy theory. Accounting and Business Research, 29 (1) pp 21-41.

Burritt, R. and Welch, S. (1997) Accountability for environmental performance of the Australian Commonwealth public sector. Accounting, Auditing & Accountability Journal, 10 (4) pp 532-561.

Can, E. (2004) Terdakwa korupsi BRI keberatan tuntutan jasa. Retrieved: 4 October 2006, from www.tempointeraktif.com/hg/hukum/2004/06/03/brk,20040603-06,id.html.

Choi, J. (1999) An investigation of the initial voluntary environmental disclosures made in Korean semi-annual financial reports. Pacific Accounting Review, 11 (1) pp 73-102.

Cooke, T. (1991) An assessment of voluntary disclosure in the annual reports of Japanese corporations. The International Journal of Accounting, 26 (3) pp 147-189.

Cooke, T. and Wallace, R. (1989) Global Surveys of Corporate Disclosure Practices and Audit Firms: A Review Essay. Accounting and Business Research, 20 (77) pp 47-57.

Downloads

Published

2006-06-30

How to Cite

Roman Cahaya , F. ., A Porter , S. ., & M Brown, A. . (2006). NOTHING TO REPORT? MOTIVATIONS FOR NON-DISCLOSURE OF SOCIAL ISSUES BY INDONESIAN LISTED COMPANIES. The Journal of Contemporary Issues in Business and Government, 12(1), 43–61. Retrieved from https://cibgp.com/au/index.php/1323-6903/article/view/9

Issue

Vol. 12 No. 1 (2006): The journal of contemporary issues in business and government

Section

Articles

License

Copyright (c) 2006 The journal of contemporary issues in business and government

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

You are free to:

  1. Share — copy and redistribute the material in any medium or format for any purpose, even commercially.
  2. Adapt — remix, transform, and build upon the material for any purpose, even commercially.
  3. The licensor cannot revoke these freedoms as long as you follow the license terms.

Under the following terms:

  1. Attribution — You must give appropriate credit , provide a link to the license, and indicate if changes were made . You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use.
  2. No additional restrictions — You may not apply legal terms or technological measures that legally restrict others from doing anything the license permits.

Notices:

You do not have to comply with the license for elements of the material in the public domain or where your use is permitted by an applicable exception or limitation .

No warranties are given. The license may not give you all of the permissions necessary for your intended use. For example, other rights such as publicity, privacy, or moral rights may limit how you use the material.