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Voluntarily Disclosing Prosocial Behaviors in Korean Firms

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Abstract

Instrumental CSR perspectives suggest that selective investments in prosocial, voluntary behaviors are largely profit-driven, whereas institutional theory emphasizes legitimacy-seeking as a significant mechanism for explicit CSR disclosure. We test both profit-seeking and legitimacy-seeking mechanisms, derived from empirical findings of Western-oriented firms, in a unique setting to understand voluntary CSR disclosure in an Eastern context: South Korea. By examining voluntary disclosure of the 500 largest South Korean firms’ social contributions from 2006 to 2012, a time period purposefully encompassing the global financial crisis (GFC), we highlight the limitations of corporate social responsibility (CSR) theorizing when East meets West. Our findings suggest profitability is not significantly related to voluntary disclosure as predicted by Western, instrumental CSR literature. Overall, we found support for legitimacy-seeking mechanisms as the likelihood of disclosure increased for publicly listed firms and those employing a larger number of workers for all years between 2006 and 2012. Further, firms affiliated with chaebols (Korean business groups) are more likely to disclose prosocial behaviors prior to, and after, the GFC compared to firms that are not affiliated with chaebols regardless of profitability further suggesting that legitimacy-seeking mechanisms may underlie CSR reporting in Korean firms.

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Notes

  1. Korea Fair Trade Commission (http://www.ftc.go.kr/eng/index.jsp).

  2. Maeil Business News is one of the national daily business newspapers in South Korea.

  3. http://www.ftc.go.kr/eng/index.jsp.

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Authors and Affiliations

  1. Quinlan School of Business, Loyola University Chicago, 16 E. Pearson Street #529, Chicago, IL, 60611, USA

    Jennifer J. Griffin

  2. Quinlan School of Business, Loyola University Chicago, 16 E. Pearson Street, Chicago, IL, 60611, USA

    Yoo Na Youm

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  1. Jennifer J. Griffin
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Correspondence to Jennifer J. Griffin.

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Jennifer J. Griffin declares that she has no conflict of interest. Yoo Na Youm declares that she has no conflict of interest.

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Appendix: Excerpt from the “Activities Regarding Corporations’ Social Contributions” Survey

Appendix: Excerpt from the “Activities Regarding Corporations’ Social Contributions” Survey

5. Please fill out in detail information regarding your company’s most representative social contributions programs. If there are no representative programs, please provide your answer based on the most recent program.

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Griffin, J.J., Youm, Y.N. Voluntarily Disclosing Prosocial Behaviors in Korean Firms. J Bus Ethics 153, 1017–1030 (2018). https://doi.org/10.1007/s10551-018-3915-1

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