IIMS Journal of Management Science
Search
1Dr. Sumita J. Shroff is an Assistant Professor at the Maharaja Sayajirao University, Baroda. She has 10 publications to her credit and has won the Best Paper Award at various national/international conferences. She can be reached at sumitashroff@gmail.com.
In the light of global warming and environmental concerns across the globe, environmental accounting and reporting has now become an emerging reality and necessity of the corporate world. Considering the same, the present paper is based on an exploratory study carried out to have an understanding of the nature and extent of environmental reporting practices followed by the market leaders (MLs). An attempt has been made to analyse the annual reports of the selected companies in order to examine their environmental disclosure practices with reference to the type of the disclosure, section where such disclosure is made and the extent of mandatory and voluntary disclosures made. An index of environmental disclosure, listing 23 items of information, was constructed after surveying the literature to find out the nature of disclosure practices in these companies. This index was further sub-divided into three groups to find out the thrust of environmental disclosures by the sample companies. It was found that majority of the MLs reported the mandatory environmental information in the ‘Director’s Report’, whereas the voluntary information was disclosed either in the ‘Highlights’ or in the ‘Dedicated Section’ of the annual report, followed by the ‘Management Discussion Analysis’ and the ‘Corporate Governance Report’ sections. A growing trend of reporting environmental information voluntarily was observed. Almost all the MLs have had environmental management systems in place by 2013. All except one ML prepared the business responsibility report, as mandated by the Securities Exchange Board of India. Further, neither the firm nor the governance characteristics had any significant impact on the environmental performance of the MLs. Hence, it was concluded that steps taken by the MLs towards environmental conservation was independent of board independence, size, leverage or profitability and that MLs were committed to the cause of environmental sustainability.
Environmental reporting, Mandatory disclosure, Voluntary disclosure, Market leaders, Energy conservation, Environmental performance
JEL Classification: M14, Q51, Q53, Q56, Q57
Alin, I., Victor, M. and Dumitru, M. (2011). ‘Environmental reporting within the Romanian companies’, International Journal of Energy and Environment, Vol. 5, Issue 1, pp. 123-131.
Clarkson, P., Li, Y., Richardson, G. and Vasvari, F.P. (2006). ‘Revisiting the relation between environmental performance and environmental disclosure: An empirical analysis’. Rotman School of Management Working Paper No. 07-07. Presented at the CAAA 2006.
Annual Conference, Hamilton 5 April 2006. Crowther, D. (2002). A Social Critique of Corporate Reporting: A Semiotic Analysis of Corporate Financial and Environmental Reporting. Ashgate Publishing, Hampshire (as cited in Yussoff (2006)).
Deegan, C., Rankin, M. and Tobin, J. (2002). ‘An examination of the corporate social and environmental disclosures of BHP from 1983-1997: A test of legitimacy theory’, Accounting, Auditing & Accountability Journal, Vol. 15, No. 3, pp. 312-343.
Gupta, V.K. Environmental Accounting and Reporting – An Analysis of Indian Corporate Sector. World Business Institute Conference Proceedings. wbiconpro.com/110-Gupta.pdf
Hughes, S.B. and Anderson, A. (2001). ‘Corporate environmental disclosures: Are they useful in determining environmental performance?’, Journal of Accounting and Public Policy, Vol. 20, No. 3, pp. 217-240.
Malarvizhi, P. and Yadav, S. (2008). ‘Corporate environmental reporting on the internet – An insight into Indian practices’. The 11th Annual Convention of the Strategic Management Forum, Indian Institute of Technology, Kanpur, India, 8–10 May 2008.
Nilipour, A. and Nilipour, A. (2012). ‘Survey of the association between financial performance and corporate sustainability performance (Case study: Cement companies accepted at Tehran stock exchange)’, Interdisciplinary Journal of Contemporary Research in Business, Vol. 3, No. 9, pp. 1084-1092.
Papaspyropoulos, K.G., Blioumis, V. and Christodoulou, A.S. (2010). ‘Environmental reporting in Greece: The Athens stock exchange’, African Journal of Business Management, Vol. 4, No. 13, pp. 2693-2704.
Riffe, D., Lacy, S. and Fico, F.G. (2008). Analyzing Media Messages: Using Quantitative Content Analysis in Research (2nd edition). Lawrence Erlbaum Associates, New Jersey (cited in Papaspyropoulos et al. (2010)).
Rouf, A. (2010). ‘Corporate characteristics, governance attributes and the extent of voluntary disclosure in Bangladesh’, Asian Journal of Management Research, Vol. 1 No. 1, pp. 166-183.
Shroff, S.J. (2012). ‘Environmental reporting practices of Indian pharmaceutical industry’, AIMS – A Journal of Management Sciences, Vol. 4, No. 2, pp. 102-120.
Tilt, C.A. (1994). ‘The influence of external pressure groups on corporate social disclosure’, Accounting, Auditing & Accountability Journal, Vol. 7, No. 4, pp. 47-72.
Wiseman, J. (1982). ‘An evaluation of environmental disclosures made in corporate annual reports’. Accounting, Organizations and Society, Vol. 7, No. 1, pp. 53-63 (cited in Yussoff and Lehman (2006)).
Yusoff, H. and Lehman, G. (2006). ‘International differences on corporate environmental disclosure practices: A comparison between Malaysia and Australia’. ICAFT 2006, University of South Australia, Adelaide, 10-12 April 2006.
Yusoff, H., Yatim, N. and Nasir, N. (2005). ‘Analysis on the development of environmental disclosure practices by selected Malaysian companies from 1999 to 2002’, Malaysian Accounting Review, Vol. 4, No. 1, pp. 49-73.
