Corporate Social Responsibility and Financial Statements Comparability
Asian Tax Journal Vol. 23 No. 5 (2022), pp. 161-181
Abstract
This study examines the association between the level of corporate social responsibility (CSR) and the financial statements comparability. The level of CSR is measured as a dummy variable with a value of 1 when the firm is included in the top 200 companies released by the Korea Economic Justice Institute. As a result of analyzing listed companies on the Korea Exchange’s securities market during the period from 2011 to 2019, it shows that firms that actively carry out CSR are more likely to exhibit higher financial statements comparability. This result suggests that firms that recognize social responsibility and actively contribute to it provide reliable and useful accounting information to interested parties. This study expands prior studies by analyzing the relationship with CSR activities using financial statements comparability that have not been reported so far. This study also provides important implications that financial reporting quality can be predicted through the level of CSR at a time when the reliability and usefulness of accounting information are emphasized.
Keywords
- corporate social responsibility
- KEJI index
- financial statements comparability
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