The relationship between the commitment of companies in corporate social responsibility and accounting policies
- Autores: Khayria Amarna
- Directores de la Tesis: Raquel Garde Sánchez (codir. tes.), María Victoria López Pérez (codir. tes.)
- Lectura: En la Universidad de Granada ( España ) en 2024
- Idioma: inglés
- ISBN: 9788411955263
- Número de páginas: 302
- Tribunal Calificador de la Tesis: Ana Zorio Grima (presid.), Lázaro Rodríguez Ariza (secret.), Inna Inna Choban de Sousa Paiva (voc.)
- Programa de doctorado: Programa de Doctorado en Ciencias Económicas y Empresariales por la Universidad de Granada
- Materias:
- Enlaces
- Tesis en acceso abierto en: DIGIBUG
- Resumen
The environmental social and governance (ESG) commitments assumed by the company imply greater transparency and reliability of information, involve a reduction of information asymmetries between managers and users, may have effects on financial and non-financial performance indicators and may lead us to contrast the quality and consistency and coherence of the policies taken, mainly in relation to misleading accounting and tax avoidance practices. The effort required for long-term sustainability demands that the measures taken by companies should not be mere policies to legitimize their actions but should be aimed at achieving the objectives set out in the mission and vision of almost all companies today, which should be consistent with ethical principles.
The joint analysis of financial and non-financial aspects will make it possible to see new paths for improvement, which can serve as a reference for institutions to set standards that can serve as a guide for entities. The improvement of information and its analysis constitute a necessary support for decision making in which resources are scarce. It will also make it possible to analyse the coherence of the policies adopted, providing stakeholders with more information for decision-making.
While environmental, social, and corporate governance commitments have become strategic elements alongside other corporate policies, they may also be used to legitimize company performance and mitigate the effects of bad practices or financial scandals potentially serving as greenwashing tools. This requires analyzing the consistency of business practices to determine if CSR and financial policies address stakeholder needs and their effects on various stakeholders. This research contributes to the literature by addressing the financial aspects of CSR, analyzing the relationship between ESG disclosure and real earnings management through operating cash flows, working capital, and discretionary expenses. It also examines whether financial indicators moderate the effect of ESG disclosure on real earnings management.
The other type of accounting practices is corporate tax avoidance. Tax laws promoting practices for tax deductions or deferrals related to ESG disclosures are considered, distinguishing between temporary and permanent tax differences, an area not deeply studied. Consistency in actions across the company is facilitated by financial and sustainability indicators. Managers may use ESG disclosures to mask real earnings management, but linking these indicators can align ethical commitments with stakeholder demands. We focused on how the company should use the ESG disclosure to benefit the society and it should avoid any accounting manipulating practices.
Companies also apply ESG initiatives to get advantages in return not only spending money. One of essential benefit the companies look for is financing cost. The decision on how to finance is so imperative for the companies, and any factors influence this decision is also important. These stakeholders need financial and non-financial disclosure. ESG reports are the most requested non-financial information. They reduce information asymmetry, help analyse environmental, social, and governance risks, and demonstrate accountability to stakeholders, society, and the environment. Thus, it is crucial to determine if stakeholders (creditors and investors) value ESG information as much as ESG disclosure and how they use this information when lending or investing.
The findings indicate that while ESG disclosure reduces real earnings management, it can also legitimize corporate activities rather than benefit stakeholders. ESG disclosures are linked to permanent tax differences from philanthropic activities and negatively to temporary tax differences, suggesting less tax avoidance by genuinely ESG-committed companies. In terms of financing, lenders favor ESG disclosures, lowering the cost of debt, while investors raise the cost of equity. This discrepancy grows with real earnings management, reducing the positive effect on debt costs and increasing investor concerns over financial manipulation.
