Corporate Social Responsibility Disclosures in Group-Affiliated Firms and Politically Connected Family-Firms: Empirical Evidence From a Traditional Society

Published Online: 15 April, 2022 || Published in Print: 30 November, 2022

Abstract

This paper explores whether the political connections of Group-affiliated firms and family firms have any impact on the corporate social responsibility disclosure (CSRD) practices in a traditional society. Using a panel data of 792 company year observations of 88 companies from the Dhaka Stock Exchange (DSE) from 2010-2018, this paper documents that the firms, which are group affiliated and which are family controlled, are positively significant to CSRD, indicating more disclosure of CSR information. However, when the family firms are politically connected, the CSRD is negatively significant. Without denying the benefits of alternative theoretical lenses adopted in disclosure studies , this paper tries to  identify whether elements of "traditionalism" such as display of loyalty to master, public display of loyalty, as characterized by Weber (1978), can be used to explain the determinants of CSRD in a developing economy. This paper contributes to the CSR literature by providing an alternative theoretical perspective for traditionalist societies and connecting political affiliation and ties with CSR disclosure. It provides a deeper insight into the dynamics of Group-affiliated firms and family-controlled firms, their ownership structures and  governance mechanism with the disclosure practices in a traditional setting .