Quality reporting of Corporate Philanthropy

Abstract

Purpose The purpose of this paper is twofold: to outline a framework for corporate philanthropy (CP) reporting that could help differentiate between symbolic and substantive reporting and to test whether the reporting practices of large corporate donors are symbolic or substantive. Design/methodology/approach First, to construct a framework for CP reporting, we draw from research on CSR communication, CP and reputational capital-building. Second, the philanthropy disclosures found in non-financial reports of the largest donors from the list of Fortune 100 corporations were examined using content analysis. Findings The theoretical framework identifies key ingredients of disclosure quality such as goals, causes, support, partners and impacts. The empirical findings show that disclosures regarding CP are more symbolic than meaningful. The largest donors provide descriptive information regarding the CP plan that primarily focuses on projects and causes. However, they fail to provide an explicit account of their decisions and the results of their philanthropic activities. Research limitations/implications The framework could also be applied with small changes to other communication outlets including social media and corporate websites. Originality/value - This paper addresses an important gap in non-financial reporting research: the lack of a CP accounting model. To our knowledge, the framework developed in this paper represents the first conceptualization of the quality of CP disclosure that may enable scholars to differentiate symbolic from substantive CP and in this way advances the debate on CP communication. This framework can also help companies sincerely engaged in philanthropy to benefit from these activities.

Purpose The purpose of this paper is twofold: to outline a framework for corporate philanthropy (CP) reporting that could help differentiate between symbolic and substantive reporting and to test whether the reporting practices of large corporate donors are symbolic or substantive. Design/methodology/approach First, to construct a framework for CP reporting, we draw from research on CSR communication, CP and reputational capital-building. Second, the philanthropy disclosures found in non-financial reports of the largest donors from the list of Fortune 100 corporations were examined using content analysis. Findings The theoretical framework identifies key ingredients of disclosure quality such as goals, causes, support, partners and impacts. The empirical findings show that disclosures regarding CP are more symbolic than meaningful. The largest donors provide descriptive information regarding the CP plan that primarily focuses on projects and causes. However, they fail to provide an explicit account of their decisions and the results of their philanthropic activities. Research limitations/implications The framework could also be applied with small changes to other communication outlets including social media and corporate websites. Originality/value - This paper addresses an important gap in non-financial reporting research: the lack of a CP accounting model. To our knowledge, the framework developed in this paper represents the first conceptualization of the quality of CP disclosure that may enable scholars to differentiate symbolic from substantive CP and in this way advances the debate on CP communication. This framework can also help companies sincerely engaged in philanthropy to benefit from these activities.