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Building Corporate Reputation Through Corporate Social Responsibility (CSR) Reports: The Case of Extractive Industries

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Abstract

Large corporations and industry groups have always used mass communication media to inform and educate important stakeholders and the general public on issues where corporate reputation and public trust are intertwined, and where any deterioration in the linkage can have significant negative consequences. An emerging trend in this direction has been the explosive growth in the voluntary publication of corporate social responsibility (CSR) reports. These reports, however, are vulnerable to corporate embellishments, which may erode their value as reputation-building instruments. To examine this situation, this paper provides a detailed and systematic analysis of 48 of the world’s largest corporations in the extractive industry (i.e., mining and minerals, oil and gas, and support services) that have published CSR reports in 2012. The extractive industry’s operations invariably raise important environmental, sociopolitical, and governance issues that are subject to heightened levels of public and regulatory scrutiny. Hence, their CSR reports carry a heavy burden of providing high-quality information that would engender public trust. Our examination of CSR reports of corporations is conducted through an analytical structure called the CSR-Sustainability Monitor® – the first system of its kind in the world that enables overall evaluations and comparisons of each CSR report with any other CSR report or group of CSR reports in our database. Our analysis shows that these companies’ CSR reports generally provide extensive information on major environmental, social, and governance issues. But they are less forthcoming on many controversial aspects of their operations that impact the public domain. This is unfortunate because it reduces public trust in the quality of these reports and undermines the value of one of the most important instruments of public communication available to the companies. Finally, we provide some suggestions that companies may incorporate into their CSR reports going forward.

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  1. Weissman Center for International Business, Zicklin School of Business, Baruch College, City University of New York, One Bernard Baruch Way, Box J-1034, New York, NY, 10010, USA

    S. Prakash Sethi & Mert Demir

  2. Weissman Center for International Business, Zicklin School of Business, Baruch College, City University of New York, One Bernard Baruch Way, Box J-0810, New York, NY, 10010, USA

    Terrence F. Martell

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  1. S. Prakash Sethi
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Correspondence to S. Prakash Sethi.

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Sethi, S.P., Martell, T.F. & Demir, M. Building Corporate Reputation Through Corporate Social Responsibility (CSR) Reports: The Case of Extractive Industries. Corp Reputation Rev 19, 219–243 (2016). https://doi.org/10.1057/s41299-016-0004-1

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