An Empirical study of corporate social responsibility and its disclosure in Islamic financial institutions.

Aribi, Zakaria Ali (2009) An Empirical study of corporate social responsibility and its disclosure in Islamic financial institutions. PhD thesis, Edinburgh Napier University.

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Corporate Social Responsibility (CSR) and Corporate Social Responsibility
Disclosure (CSRD) have received much attention in the literature. However, a
review of previous studies has revealed that the current discussions on CSR and
CSRD do not go beyond the disciplinary perspective (e. g. management,
accounting, and ethics) and ignore the possibility of conceptualisation of CSR
and CSRD based on other values, such as religion. Many of these studies have
proposed different theories to explain why corporations disclose or do not
disclose social responsibility information. The various CSRD theories exclude
religion as a foundation in explaining why organisations should disclose social
responsibility information, and also in making assessment of the performance of
organisations in terms of fulfilling their obligation to God. These theories have
been developed mainly in the context of the liberal market, and may not offer full
justification of CSR and CSRD practices in a dissimilar socio-culture, such as the
case of Islamic financial institutions (IFIs).
While values and principles that have been central to Islamic teaching and
philosophy are directly related to the notion of CSR, there are some empirical
studies that have attempted to investigate the relationships between those Values
and CSR and CSRD. The mainstream of existing studies has tended to examine
the gap between the expectation of social disclosure and the actual disclosure
practice in Islamic business organisations such as IFIs. In order to understand
the practice of CSR and CSRD by IFIs, it is also important to investigate the
perception of the managers who are in charge of producing corporate reports,
and to understand the reasons and rationales behind disclosing or non-disclosing
social responsibility information. In addition, there is a lack of comprehensive
studies comparing the practice of CSRD in IFIs with its conventional
counterparts, as such a comparison offers an insight into the nature of CSRD in
IFIs, which are influenced by the value of Islam.
To achieve this objective, this study conducted a mix of qualitative and
quantitative research. On the quantitative part, 42 financial institutions, divided
equally between IFIs and conventional financial institutions (CFls), were studied.
The content analysis method was utilised to compare the extent and level of
CSRD in the annual reports between IFIs and CFIs. On the qualitative research
side, interviews were utilised to seek the perspectives, attitudes and opinions of
IFIs'managers on CSR and CSRD.
This study presents evidence that Islamic values have driven the business
practice of IFIs and consequently influenced CSR and CSRD. The principle of
accountability to Almighty Allah was found as the prominent driver for CSR and
CSRD in IFIs. This accountability is based on the relationship between
individuals and businesses, and Almighty Allah. Accountability in this context
means not only a duty to report performance, but performing ethically in the first
place. This notion of accountability from an Islamic perspective provides a
different dimension to the concept of CSR and CSRD, which was not identified in
the existing framework and literature. This study has therefore contributed to our
understanding and knowledge of CSR, and CSRD in particular, in the business
environment of IFIs.

Item Type: Thesis (PhD)
Uncontrolled Keywords: corporate social rsponsibility; disclosure; conceptualisation; religion; financial isntitutions; Iran;
University Divisions/Research Centres: The Business School > School of Accounting, Economics and Statistics
Dewey Decimal Subjects: 600 Technology > 650 Management & public relations > 658 General management
Library of Congress Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Item ID: 3797
Depositing User: Mrs Lyn Gibson
Date Deposited: 08 Jul 2010 09:02
Last Modified: 12 Jan 2011 04:55

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