Disclosure Pattern of Labour Practices and Decent Work and Its Impact on Corporate Financial Performance: Evidence from Asia

Abstract

Productive employment and decent work are the key elements for achieving fair globalization and poverty reduction as indicated in the International Labour Organization (ILO) Decent work agenda. The ILO adopted core labour standards to examine the labour practices all over the world, with the aim of making a balance between procedural justice and social rights. Further, Global Reporting Initiative (GRI) framework provides guidelines for reporting labour practices and decent work (LA) performance in the sustainability reporting framework. The purpose of this study is to contribute to the empirical literature by providing information about quantity and quality of disclosure on LA of four Asian countries, namely Japan, South Korea, India and Indonesia, during the period 2009–2017. Using content analysis based on GRI framework, this study finds that Japanese firms disclose more information relating to quantity and quality of LA. On the other hand, firms from Indonesia disclose least information on LA in the annual reports as compared to others. Further, the gap between quantity and quality of LA disclosure is found to be the highest in Indonesia followed by India and South Korea. Regarding the components, our results indicate that firms from Indonesia and India provide less information about the quality aspects of ‘equal remuneration for women and men’ and ‘training and education’. On the other hand, the average quality disclosure on ‘diversity and equal opportunity’ is relatively less for all the four countries. However, our results of quantile regression reveal that the positive impact of LA performance increases as we move from the lower quantile to the upper quantile of corporate financial performance. However, we find insignificant impact of LA on financial performance of firms from Indonesia.

Impact of carbon productivity on firm performance: moderating role of industry type and firm size

“…LEV is also found to have a negative impact on ROA, which possibly indicates the detrimental impact of increasing leverage in the form of curving operational flexibility of management and underinvestment problems. The negative relationship between leverage and firm performance in the case of Indian firms is consistent with the findings of prior empirical studies (Jaisinghani, 2016a; Maji, 2019). GROW is seen to have an insignificant effect on firm performance in the Indian context.…”

“…Following prior empirical studies, the study uses four firm characteristics as control variables: (SIZE), leverage (LEV), growth (GROW) and R&D intensity (R&D) (Maji, 2019;Kumar et al, 2021). The exact definition of all the variables is provided in Table 1.…”

Climate change financial disclosure and firm performance: empirical evidence from Indian energy sector based on TCFD recommendations

“…The study uses content analysis technique to measure climate change disclosure score. Empirical literature posits that three aspects are very important in content analysis: source of information, content of analysis and unit of analysis (Guthrie and Petty, 2000; Abeysekera and Guthrie, 2005; Maji, 2019). In line with the empirical literature, we use annual report and business responsibility and sustainability report as the source of information and the guidelines of TCFD (2017) as the content of analysis.…”

“…Based on the recommendation of the TCFD, 11 items are considered for analysis encompassing four core elements as identified by the committee. Regarding the unit of analysis, earlier researchers have used diverse mechanism such as number of sentences, number of paragraphs, portion of pages, number of pages, binary coding system and use of scale (Zeghal and Ahmed, 1990; Deegan and Gordon, 1996; Unerman, 2000; Guthrie, et al , 2004; Burhan and Rahmanti, 2012; Wang et al , 2016; Maji, 2019). Following the recent empirical studies (Wang et al , 2016; Maji, 2019), we use a three-point scale (0–2) for calculating the overall climate-related financial disclosure score (CFDS O ) and disclosure score for four core elements – governance (CFDS G ), strategy (CFDS S ), risk management (CFDS RM ) and metrics and targets (CFDS MT ).…”

Assessing the effect of core and expanded ESG on corporate financial performance: COVID-19’s moderating role

“…The codes are: “0” for non-disclosure, “1” for partial disclosure, “2” for full disclosure in descriptive form and “3” for disclosure with numerical clarity or with all relevant information for decision-making purposes. This coding mechanism facilitates a more objective measurement of the disclosure score (Maji, 2022). Once the item-wise scores for each firm and each year are obtained, the overall ESGD and disclosure scores for the individual components of ESG are computed using the provided formula: where i represents firm, t time, j items and N denotes the maximum score, which remains constant for all firms throughout the years.…”