Managing legitimacy through increased corporate environmental reporting: an exploratory study
by Gary O'Donovan
Interdisciplinary Environmental Review (IER), Vol. 1, No. 1, 1999

Abstract: During the last fifteen years, corporations have increased the amount of information being disclosed in the corporate annual report. Research why this increase has occurred has spawned a number of theories embracing the increasing social and environmental responsibilities of business. One such theory is legitimacy theory. This theory is based on the idea that in order to continue operating successfully, corporations must act within the bounds of what society identifies as socially acceptable behaviour. If a corporation acts outside these bounds, its future profitability and existence could be threatened. Proponents of this theory argue that a corporation can (and does) legitimise itself in the eyes of the public by voluntarily disclosing information about its social activities in the corporate annual report. The main aim of the exploratory research reported in this paper was to discover to what extent legitimacy theory may explain the presence of environmental disclosures in the annual report. In a departure from content analysis methods used in prior research on environmental disclosures and legitimacy theory, a case study approach using semi-structured interviews with senior corporate personnel from three large public corporations identified as operating in environmentally sensitive industries, was adopted. Results suggest that corporations in the study will increase environmental disclosures if a need to defend or justify negative environmental activities with which the company or industry has been associated with had been identified. The incentive to disclose increased if these environmental activities had been brought to public notice via mainstream media. Management also views that the inclusion of environmental information in the annual report may help the corporation shape public opinion. These findings are consistent with the broad thrust of legitimacy theory.

Online publication date: Mon, 13-May-2013

The full text of this article is only available to individual subscribers or to users at subscribing institutions.

 
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.

Pay per view:
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.

Complimentary Subscribers, Editors or Members of the Editorial Board of the Interdisciplinary Environmental Review (IER):
Login with your Inderscience username and password:

Username:        Password:          Forgotten your password?

Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.

If you still need assistance, please email subs@inderscience.com