Original Research

The association between corporate social responsibility reporting and firm value for South African firms

Riana Horn, Marna de Klerk, Charl de Villiers
South African Journal of Economic and Management Sciences | Vol 21, No 1 | a2236 | DOI: https://doi.org/10.4102/sajems.v21i1.2236 | © 2018 Riana Horn, Marna de Klerk, Charl de Villiers | This work is licensed under CC Attribution 4.0
Submitted: 05 December 2017 | Published: 28 August 2018

About the author(s)

Riana Horn, Department of Financial Accounting, University of South Africa, South Africa
Marna de Klerk, Department of Accounting, University of Pretoria, South Africa
Charl de Villiers, Department of Accounting, University of Pretoria, South Africa; Graduate School of Management, University of Auckland, New Zealand


Background: Corporate social responsibility (CSR) disclosure is widespread among the largest companies in South Africa due to the listing requirements of the Johannesburg Stock Exchange (JSE). These companies have also increasingly pursued external assurance of their CSR disclosures in recent years. The increased regulation of CSR disclosure and the increased rate of obtaining assurance of these disclosures motivated us to perform our study.

Aim: To examine the association between CSR reporting, including both CSR disclosure and CSR assurance, and firm value of large South African companies.

Setting: The JSE listing requirements place South Africa, the setting for our study, at the forefront of corporate governance and CSR reporting.

Method: Tobin’s Q is used as a measure of firm value. Three measures of CSR disclosure and three of CSR assurance are used in this study. The measures are based on data collected by Klynveld Peat Marwick Goerdeler (KPMG) International on the CSR reporting practices of large South African companies. The sample period for this study coincides with the sample period covered in the KPMG surveys conducted during 2008, 2011 and 2013.

Results: No significant association is found between CSR disclosure and firm value. However, a significant negative association is found between CSR assurance and firm value. Additional analysis found that the negative association between firm value and CSR assurance is more significant for companies that are not listed on the Socially Responsible Investment (SRI) index.

Conclusion: The results found between CSR disclosure and firm value may suggest that firm value is unaffected by CSR disclosures. Taken together, the findings on CSR assurance and firm value and the additional analysis may suggest that in South Africa managers with negative CSR issues are more likely to obtain assurance on their CSR disclosure. The findings may be of interest to regulators when considering current and future disclosure and assurance requirements for CSR reporting in South Africa, as well as other parts of the world, shareholders when considering investment options, and managers when considering the benefit of certain CSR reporting practices.


corporate social responsibility; Tobin’s Q; firm value


Total abstract views: 2726
Total article views: 3514

Crossref Citations

No related citations found.