Paper Number
2287
Paper Type
Completed
Description
A corporate social responsibility (CSR) report is an important tool for disseminating a company’s sustainability efforts. The informativeness of CSR reports in relation to key performance indicators (KPIs) of companies is not well studied. We define eight different attributes to characterize textual disclosure and identify six topic distributions across 1233 CSR reports submitted by 196 major US firms during 2005-2017. We analyze the association of these attributes and topics with firm performance and firm value using hierarchical Bayesian modeling. Our results show that while multiple topics and textual attributes are related to firm value, only word length is significantly linked to the performance of firms in general. Our study informs firms about best practices in sustainability reporting and notifies investors and regulators about present practices in CSR reporting.
Recommended Citation
Srinivasan, Karthik; Rao, Sunita; and juma, Norma A., "Are Sustainability Reports Informative About Firm Value and Performance? A Text Mining Approach" (2023). ICIS 2023 Proceedings. 6.
https://aisel.aisnet.org/icis2023/soc_impactIS/soc_impactIS/6
Are Sustainability Reports Informative About Firm Value and Performance? A Text Mining Approach
A corporate social responsibility (CSR) report is an important tool for disseminating a company’s sustainability efforts. The informativeness of CSR reports in relation to key performance indicators (KPIs) of companies is not well studied. We define eight different attributes to characterize textual disclosure and identify six topic distributions across 1233 CSR reports submitted by 196 major US firms during 2005-2017. We analyze the association of these attributes and topics with firm performance and firm value using hierarchical Bayesian modeling. Our results show that while multiple topics and textual attributes are related to firm value, only word length is significantly linked to the performance of firms in general. Our study informs firms about best practices in sustainability reporting and notifies investors and regulators about present practices in CSR reporting.
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Comments
05-SocImpact