This chapter begins with the designation of the independent and control variables, two types of arrested development theoretical accounts every bit good as the empirical scheme. After that, the developments of six hypotheses are discussed in item. In add-on, it besides discusses the research methodological analysis adopted to transport out this survey. This includes the research instrument used, sample choice method of 242 companies and the informations aggregation procedure. Finally, the measuring of variables used is discussed at the terminal of this chapter.
entification of Variables
Based on the old literature reviewed on CSR revelations, resource-based theories and bureau theories, some possible variables are identified to be the independent variables which could act upon the extent of the CSR revelations, the mediating variables every bit good as the control variables.
Designation of independent variables
Harmonizing to the resource-based theory, Tsang ( 1998 ) has grouped the resources into three classs viz. physical resources which are comprised of touchable and intangible assets ; human resources which include instruction, preparation, experience and all other soft accomplishments ; and organizational resources which include corporate civilization, organizational construction, regulations and processs, direction information system and the relationship with external establishments.
Furthermore, Galbreath ( 2004 ) has classified the companies ‘ resources into four classs which include rational belongings assets, organizational assets, reputational assets and capablenesss of the companies. In add-on, Fahy ( 2002 ) has identified three types of resources which are touchable assets, intangible assets, and capablenesss in analyzing the nexus between companies ‘ resources and steadfast public presentation.
In add-on, Leask and Parnell ( 2005 ) have highlighted that companies ‘ resources consist of three classs which are physical capital resources which relate to the equipments and stuffs ; human capital resources which relate to employees ; and organizational capital resources which relate to the operations of the administrations. Ainuddin et Al. ( 2009 ) have identified two types of resources known as assets and capablenesss. Assetss are referred to touchable assets whereas capablenesss are referred to as intangible assets.
Weidong ( 2007 ) has identified two types of resources which could take companies in hapless states to derive competitory advantages. There are touchable resources and intangible resources with heterogeneousness and imperfect mobility features. This is supported by Branco and Rodrigues ( 2006 ) who besides classified companies ‘ resources into touchable assets and intangible assets. Therefore, two common types of corporate resources maintained by the Malayan public listed companies are identified to dwell of intangible assets and touchable assets.
Companies ‘ resources, the intangible assets
Companies can derive sustainable competitory advantages by strategically utilizing their corporate resources particularly intangible assets. In order to derive competitory advantages, companies have to guarantee that their resources can non be duplicated and alternated by their rivals ( Canto & A ; Gonzalez, 1999 ; Barney, 1999 ) . Besides, Branco and Rodrigues ( 2006 ) besides argued that the handiness of equal intangible assets is an of import beginning of competitory advantage provided as companies have strategically used the intangible resources to put in CSR activities.
In add-on, Canto and Gonzalez ( 1999 ) found that intangible assets which comprise of human resources and commercial resources have a positive relationship with the success of R & A ; D activities carried out by the companies. Galbreath ( 2005 ) has besides found four types of intangible assets which comprise of rational belongings, organizational assets, reputational assets and capablenesss that have a positive relationship with the companies ‘ success.
Furthermore, Fahy ( 2002 ) has found that investing in intangible assets can take companies to derive sustainable competitory advantages in a planetary environment. This is supported by Coates and McDermott ( 2002 ) who found that intangible assets known as cognition is the cardinal beginning of competitory advantage. This can be achieved when employees efficaciously use their expertness and accomplishments in transporting out their occupation duties.
188.8.131.52 Companies ‘ resources, touchable assets
Some old surveies found that intangible assets are the chief subscribers to the companies ‘ public presentation which finally leads to the competitory advantage. However, the function of touchable assets in finding the continuity of the concern operations and conveying the companies in front of their rivals to derive sustainable competitory advantages can non be substituted by intangible assets ( Craig & A ; Diga, 1998 ; Fahy, 2002 ; Galbreath, 2005 ) .
In add-on, Branco and Rodrigues ( 2006 ) suggested that touchable assets can be the beginning of competitory advantages if companies expeditiously and efficaciously assemble, integrate and pull off the resources and utilize the resources to execute their activities.
Besides, Douglas, Doris and Johnson ( 2004 ) , Mohd Ghazali ( 2007 ) and Udayasankar ( 2007 ) argue that larger companies are more likely to put in CSR activities instead than in smaller companies due to the handiness of resources. This is because prosecuting in CSR activities and revelations in the one-year studies requires the escape of monies.
Furthermore, Bhattacharyya ( 2010 ) besides found that the handiness of touchable assets have encouraged companies to put in CSR activities due to the uninterrupted benefits gained from those activities.
Most of the CSR revelation literature in Malaysia have discussed the relationship between the corporate administration and the extent of CSR revelation to include the influence of ownership constructions ( household, authorities, foreign ownerships ) on CSR revelations ( Mohd Ghazali, 2007 ; Amran & A ; Devi, 2007 ; Ying et al. , 2008 ; Darus et al. , 2009 ) .
In add-on, other surveies have besides examined the relationship between ownership constructions which comprise of province ownership, managerial ownership, legal-person ownership, block holder ownership and foreign listing ownership, and the extent of CSR revelations in China ( Xiou & A ; Yuan, 2007 ) .
This is supported by Rashid and Lodh ( 2008 ) who examined the influence of ownership concentration on the extent of voluntary CSR revelation in developing states. Therefore, two types of ownership constructions are identified to find the interaction impact with a positive relationship between corporate resources and the extent of CSR revelations.
Ownership constructions, per centum of household ownerships
Mohd Ghazali ( 2009 ) found that manager ownership is negatively associated with the extent of CSR revelations. This is because these types of companies less likely to be the chief involvement of the populace to make the CSR activities.
In add-on, Darus et al. , ( 2009 ) have found that the regulative attempts did non alter the household proprietors ‘ negative position on the CSR activities and revelations. As a consequence, these household companies were less likely to unwrap CSR information in the one-year studies ( Lopez-Iturriaga et al. , 2009 )
Ownership constructions, per centum of authorities ownerships
On the other manus, the companies with higher authorities shareholding tend to unwrap more CSR information in their one-year studies to let go of their public answerability ( Mohd Ghazali, 2007 ) . This is supported by Darus et Al. ( 2009 ) who found that the ordinance imposed by the authorities appears to advance the CSR revelations in authorities owned companies.
In add-on, Amran and Devi ( 2008 ) besides revealed that the authorities has a important positive influence on the extent of CSR revelations. This is consistent with the survey carried out by Ying et Al. ( 2008 ) , Said et Al. ( 2009 ) and Siwar and Md Harizan ( twelvemonth? ) who suggest that the authorities should take the attempt to better the answerability and transparence of fiscal coverage in Malaysia.
Two control variables are identified from the old literature. Rashid and Lodh ( 2008 ) used return on assets ( ROA ) as a profitableness step to analyze the public presentation of the houses. This is calculated by spliting Net incomes Before Interest and Taxes with entire assets. This is besides consistent with Said et Al. ( 2009 ) and Mohd Ghazali ( 2007 ) . In add-on, the survey besides identified that the entire debts are an of import instrument that is closely related to the extent of CSR revelations. Therefore, the ratio of entire debts to the entire assets is considered to be the control variable. By commanding these two variables it will heighten the relationship between corporate resources and the extent of CSR revelations ( Rashid & A ; Lodh, 2008 ; Xiou & A ; Yuan, 2007 ) .
Multiple Regression Analysis
A linear-multiple arrested development analysis is used to prove the association between the dependent variable of CSR revelations and the independent variables of companies ‘ resources which are touchable assets and intangible assets. The undermentioned theoretical account is estimated:
CSRD = I?0 + I?1INTAN + I?2TAN + I?3FINTAN + I?4 FTAN + I?5 GINTAN + I?6GTAN I?7LEV + I?8ROA + a?‘t
CSRD is the extent of CSR revelations
TAN is the touchable assets
INTAN is the entire intangible assets
FINTAN is the per centum of household members on the board to entire figure of managers on board X sum intangible assets
FTAN is the per centum of household members on the board to entire figure of managers on board X sum touchable assets
GINTAN is the proportion of equity owned by the authorities as its bureaus such as Khazanah Nasional Berhad, Permodalan Nasional Berhad ( PNB ) , Lembaga Tabung Haji ( LTH ) , Lembaga Tabung Angkatan Tentera ( LTAT ) , Menteri Kewangan ( MKD ) and Kumpulan Wang Simpanan Pekerja ( KWSP ) to the entire portions issued X entire intangible assets
GTAN is the proportion of equity owned by the authorities as its bureaus to the entire portions issued X entire touchable assets
LEV is entire liabilities divided by entire assets.
ROA is the net incomes before involvement and revenue enhancement ( EBIT ) divided by entire assets
a?‘t is the error term
Hierarchical Regression Analysis
Based on the above theoretical account, three separate cross-sectional arrested development theoretical accounts are developed to prove hypotheses 1 to 3 based on the hierarchal arrested development analysis. They are designed to measure whether there are any coefficient difference across the different sub-population. The three theoretical accounts are as follows:
CSRD = I?0 + I?1LEV + I?2ROA + a?‘t
CSRD = I?0 + I?1INTAN + I?2TAN + I?3LEV + I?4ROA + a?‘t
CSRD = I?0 + I?1INTAN + I?2TAN + I?3FINTAN + I?4 FTAN + I?5 GINTAN + I?6GTAN I?7LEV + I?8ROA + a?‘t
Agency Theory – Ownership structureBelow is the empirical scheme that has been designed for the survey:
Family members ( FAM )
H2a ( -ve )
H2b ( -ve )
The Extent of CSR revelations
Resource-Based View theory – Corporate Resources
H1a ( +ve )
Tangible Assetss ( TAN )
H1b ( +ve )
Intangible Assetss ( INTAN ) H
H3b ( +ve )
H3a ( +ve )
Control variables – 1 ) Leverage
2 ) Profitableness
Agency Theory – Ownership construction
Government ownership ( GOV )
Figure 1: Empirical scheme for companies ‘ resources and CSR revelations
Development of Hypotheses
Based on the literature reviewed, two types of resources have been identified which are touchable and intangible resources to prove their associations with the CSR revelations by Malayan public listed companies in three old ages from 2006 to 2008. This is due to the limited resources available during the planetary economic crisis which began in 2007, bespeaking that most Malayan companies have been in the province of minimising and cutting off the relevant costs in keeping their sustainability in the market. Therefore, puting in CSR activities will be the chief issue for these companies.
Besides that, the two types of ownership constructions are the chairing variables between the relationship of the companies ‘ resources and the CSR disclosures particularly in the current planetary economic crisis. These constructions consist of household ownership and authorities ownership constructions. The household members on the board will happen a manner to understate all the costs in maximizing their net incomes particularly costs which are non straight related to the public presentation and sustainability of their companies.
On the other manus, the companies which are controlled by the authorities bureaus are required to back up the authorities ‘s attempts in promoting Malayan companies to be socially responsible corporate citizens. These companies are more likely to take part in CSR activities as a manner to promote other public listed companies to be more caring on society and environmental issues. These hypotheses are formed based on the anterior literature that has been reviewed.
Intangible Assetss and CSR Disclosures
Other of import beginnings of competitory advantages are the intangible resources like the capablenesss, the accomplishments and expertness of employees. Sometimes, the investing in CSR activities will in bend developed new capablenesss and resources ( Branco & A ; Rodrigues, 2006 ) . However, before the companies can profit from such activities, they need to hold plenty intangible resources so that they can bring forth net incomes and accordingly lend in the CSR activities.
Ainuddin et Al. ( 2007 ) besides argued that valuable resources are those resources which can take the companies to accomplish efficiency and effectivity in their public presentation and finally derive sustainable competitory advantages. The writers have tested the influence of the resources ‘ features with the houses ‘ public presentation which is valuable, rare, amiss imitable and non- substitutable. They found a positive relationship between value and rareness with the house ‘s public presentation for both assets and capablenesss.
Furthermore, Canto and Gonzalez ( 1999 ) have examined the relationship between house resources which are fiscal resources, physical resources and intangible resources with R & A ; D activities on 256 Spanish houses in 1992. The writers have categorised intangible resources into two classs which are human resources and commercial resources. They found a important consequence whereby a high making of human resources is of import in finding the success of the R & A ; D activities carried out by the companies. On the other manus, exports are one the chief determiners in R & A ; D activities under the commercial resources classs which is non important.
In add-on, four constituents of intangible resources have been identified by other research workers which are rational belongings, organizational assets, reputational assets and capablenesss, and these sorts of resources are said to hold a relationship with the companies ‘ success ( Galbreath, 2005 ) . One of the intangible resources is reputational assets which are developed from corporate societal duties. When companies participate and invest in CSR activities, this will make a good will and good repute among the stakeholders particularly the populace at big and the conservationists. Therefore, this sort of resources must be managed good in avoiding them from being easy imitated by rivals for the interest of the companies ‘ success ( Galbreath, 2005 ) .
Bhattacharyya ( 2010 ) added another type of intangible resources which were generated from strategic CSR activities for illustration, technological expertness for the socially responsible, green merchandises and services which are environmental friendly. Deniz and Suarez ( 2005 ) besides found that companies which participated in the CSR programme will derive competitory advantage in three signifiers. First, the programme will organize an effectual base for viing in the markets. Second, the CSR programme will besides take companies to do greater parts to the society. Third, the authorities will relieve companies from the new ordinances imposed.
Furthermore, Fahy ( 2002 ) has developed a resource-based theoretical account of sustainable competitory advantage in a planetary environment. The writer has examined the relationship among companies ‘ resources which comprise of touchable and intangible assets, competitory advantages and steadfast public presentation. He found that intangible assets are an of import beginning of sustainable competitory advantages than the touchable assets at a one per centum degree.
In add-on, Coates and McDermott ( 2002 ) have found that intangible assets which are known as cognition is the cardinal beginning of competency. This cognition can be expressed through the expertness and accomplishments of the human capital in transporting out their everyday responsibilities with a high grade of forte every bit good as with job work outing accomplishments to derive sustained competitory advantages.
Barrat and Oke ( 2007 ) further added that the resources which can give a supply concatenation linkages a typical visibleness come from a combination of valuable, rare, amiss mobile, non imitable and non substitutable resources. This is evidenced by five instance surveies on supply concatenation linkages conducted by the writers. They found that the external linkages which link to typical visibleness will eventually take to a sustainable competitory advantage to the supply concatenation linkages. Therefore, the undermentioned hypothesis is posited:
H1a – Intangible assets are significantly positively related to the extent of CSR revelation.
Tangible Assetss and CSR Disclosures
The touchable resources are of import elements in making sustainable competitory advantages for the companies ( Galbreath, 2005 ; Fahy, 2002 ) . Companies need all those sorts of resources in order to go on running the concern, be able to put in the R and D outgo in taking the industry and remain competitory particularly in confronting the planetary economic crisis. The fabrication procedure needs a batch of money to be invested before the merchandises can be produced and distributed to the market. Companies which do non execute good are less likely to lend to the CSR activities.
In add-on, Bhattacharyya ( 2010 ) stated that prosecuting in strategic CSR activities will enable companies to bring forth touchable resources like natural natural resources, semi-finished resources, and manpower and so on. Consequently, these sorts of resources encourage companies to actively unwrap their CSR activities.
Besides, Craig and Diga ( 1998 ) have examined the relationship between CSR revelations and steadfast size among ASEAN states which include Malaysia, Singapore, Indonesia, Thailand and the Philippines. They found a important positive relationship at a one per centum degree between CSR revelations and steadfast size of ASEAN companies. This proves that house size is of import in finding the degree of CSR disclosures irrespective of the state of beginning.
This is supported by Ahmad, Hassan and Mohammad ( 2003 ) who have examined the relationship between voluntary environmental revelation and entire assets, fiscal purchase, profitableness, effectual revenue enhancement rate, audit house and industry rank of the 299 Malayan public listed companies in 1999. Unfortunately, the consequences of the survey merely supported two variables tested which were fiscal purchase and type of audit houses. This is due to the fact that the theoretical model of the principal-agent relationship did non be in the Malayan context.
However, Douglas, Doris and Johnson ( 2004 ) , Mohd Ghazali ( 2007 ) and Udayasankar ( 2007 ) argued that merely larger companies were more likely to put in CSR activities instead than smaller companies because they had more resources. Therefore by take parting in CSR activities it will affect extra costs for the companies which finally lead to the decrease of companies ‘ resources for primary concerns ( Balabanes et. Al, 1998 ) .
This is supported by Deniz and Suarez ( 2005 ) who examined the CSR approaches that household houses adopted in Spain and they found that companies which participated in CSR activities experienced cost disadvantages. This was due to a high cost engagement when take parting in CSR activities which could take them to hold to step out from the market.
Even though anterior research workers have recognised the cardinal benefits of puting in CSR activities such as improved internal determination devising and cost nest eggs, improved fiscal returns, improved corporate images and so on ( Khan et. Al, 2009 ) , CSR activities are still seemed to be cost faulty for smaller companies. Therefore, the undermentioned hypothesis is posited which reflect the importance of resources in act uponing the CSR activities:
H1b – Tangible assets are less significantly positively related to the extent of CSR revelation.
Moderating Effect of Family Ownership on Companies ‘ Resources and CSR Disclosure Relationship
Family ownership companies are those companies in which the board of managers has household relationship with other board members in the company. This includes the relationship of hubby and married woman, parent and grandparent, brothers and sisters, in-law and cousin. In Malaysia, most of the companies are founded by household owned concerns in which they are the proprietors and the directors who sit on the board of the company. The traditional end of this type of company is fundamentally to maximize the stockholders ‘ wealth by bring forthing as highest net incomes as possible.
Besides that, public answerability in this type of companies is non of import because it is non held by the populace at big ( Mohd Ghazali, 2007 ) . The viing demands of the scarce resources have influenced the companies non to lend to the CSR activities since all those activities involve money.
In add-on, Rashid and Lodh ( 2008 ) besides found a negative relationship between corporate ownership constructions and CSR disclosures among Bangladesh listed companies at a 10 per centum degree after corporate administration presentment. This has proven that the corporate administration mechanism which was introduced in Bangladesh to hold outside independent managers on the board was effectual because these independent managers have played their functions in promoting household proprietors to unwrap more CSR information.
Darus et Al. ( 2009 ) besides found that household proprietors of Malayan public listed companies do non likely engage in CSR activities promoted by the authorities. Based on 144 companies ‘ consequences, household ownership constructions were found to hold a important negative relationship with CSR revelations. This implied that the possibility of collusion between independent non-executive managers and household proprietors is really high in cut downing the sum of CSR revelations.
However, some other research workers found that household owned companies are more likely to keep a good relationship with employees, clients and providers for the interest of their concern ( Uhlaner et.al, 2004 ) . This is supported by Wan Hussin ( 2009 ) who found that household members on the board are more likely to act upon other board members to unwrap all the information related to section coverage. Therefore, the undermentioned hypotheses are posited:
H2a – The higher the per centum of household members on the board, the weaker will be the positive relationship between intangible assets and the extent of CSR revelation.
H2b – The higher the per centum of household members on the board, the weaker will be the positive relationship between touchable assets and the extent of CSR revelation.
Moderating Effect of Government Ownership on Companies ‘ Resources and CSR Disclosure Relationship
In add-on to the household members who founded the companies to run the concern for net income devising intents, the authorities has besides set up non-profit administrations to carry through the societal demands ( Mohd Ghazali, 2007 ) . The authorities through its investing companies viz. Khazanah Holdings Bhd, PNB, LTH, LTAT, MKD and KWSP, which are usually connected to political relations, guarantee that their corporate duty activities reflect the authorities ‘ duties towards the society at big. The answerability of coverage will go an of import affair since the populace will demand more societal activities from these administrations because they are considered public owned companies ( Mohd Ghazali, 2007 ) .
Khazanah Nasional Berhad has defined Government-Linked Companies ( GLCs ) as “ companies that have a primary commercial aim and in which the Malayan Government has a direct commanding interest. Controling interest refers to the Government ‘s ability ( non merely per centum ownership ) to name BOD members, senior direction, and do major determinations ( e.g contract awards, scheme, restructuring and funding, acquisitions and divestments etc. ) for GLCs either straight or through GLICs. ” ( Source? ) ( Abbreviations should be explained the first clip used )
In Malaysia, the authorities has even adopted the Silver Book in 2006 which required the Government-Linked Companies ( GLCs ) to obligatorily unwrap the CSR activities in their one-year studies. This is to guarantee that their CSR activities will promote other public listed companies to follow their lead. This is true because other surveies have proven that the public listed companies are more active in CSR revelations than the private companies ( Kotonen, 2009 ) .
Said et.al ( 2009 ) found a positive relationship between authorities ownership and CSR revelations in their survey. This implied that the authorities has the power to step in on the companies ‘ administration in baronial force per unit area so that they will unwrap more information sing their CSR activities. This is supported by Xiou and Yuan ( 2007 ) who found a positive relationship between CSR revelations and authorities ownership constructions, although the writers have posited a negative relationship between two of them in the first topographic point. This is because China has begun to promote companies to prosecute in CSR activities voluntarily.
Besides, Amran and Devi ( 2008 ) besides found a important positive relationship between authorities ownership and CSR revelations at a one per centum degree. This indicates that the authorities ‘s interaction on companies through shareholding by authorities bureaus is able to act upon the degree of the companies ‘ CSR revelations. The same consequences were found by Ying et Al. ( 2008 ) between the authorities owned companies and CSR revelations in which it was implied that the authorities had successfully implemented good corporate administration by promoting Government-Linked companies ( GLCs ) to heighten transparence and answerability of fiscal coverage through CSR revelations. It was besides a manner to carry other public listed companies to make the same.
In add-on, Darus et Al. ( 2009 ) found a important positive relationship between authorities ownership and CSR revelations. They argued that the high bureau struggle faced by directors in government-linked companies have encouraged them to cut down it through CSR activities, at the same clip back uping the authorities ‘s attempts to function the society at big. This was consistent with Siwar ( twelvemonth? ) who found that Government-Linked Companies ( GLCs ) supported CSR activities by following a high policy for the interest of their employees. Therefore, the undermentioned hypotheses are posited ;
H3a – The higher the per centum of authorities ownership, the stronger will be the positive relationship between intangible assets and the extent of CSR revelation.
H3b – The higher the per centum of authorities ownership, the stronger will be the positive relationship between touchable assets and the extent of CSR revelation.
Besides that, other control variables are of import to be considered before the dependant and independent variables can be examined. The profitableness of the company will act upon the degree of CSR activities involved. The higher the ROA, the more parts will be made to the society at big. The companies which unwrap more information in the one-year studies are considered the benchmark for their good public presentation ( Mohd Ghazali, 2007 ) . More CSR revelations are made to bespeak the better public presentation of these companies ( Rashid & A ; Lodh, 2009 ) .
In add-on, the purchase of the company which can be examined from the debt ratio besides influences the degree of the companies ‘ parts towards the CSR activities and therefore the CSR revelations. The houses with high debt degrees are expected to incur higher monitoring costs. Therefore, these types of companies unwrap more information in one-year studies in order to cut down the monitoring costs ( Ahmed & A ; Courtis, 1999 ) . The longer the company ‘s listed on the Main Board the higher the revelations of corporate duties ( Rashid & A ; Lodh, 2009 ) . This is because of the populace ‘s outlook towards the populace listed companies sing the corporate duty activities which are higher on the land that those companies are theirs and the net incomes of the companies should be shared with the populace at big.
This survey was done based on the content analysis of 242 Malayan Public Listed companies ‘ one-year studies utilizing word count and besides information from the information watercourse. Unerman, 2000 and Rizk et Al. 2008 have quoted most of their justifications from old surveies which have used one-year studies in CSR content analysis to cover three factors which are:
“ Our credence of the societal importance of the corporate one-year study stresses its possible ( instead than fact ) to be influential. Corporate one-year studies can hence be of involvement as much for what they do non describe, as for their existent content. This focal point on the corporate one-year study is besides consistent with old societal revelation surveies, since the corporate one-year study is the chief signifier of corporate communicating and peculiarly in the instance of quoted companies, is made widely available ” ( page? )
Contented analysis is used to mensurate the extent of CSR revelations in the one-year studies utilizing word count ( Ratanajongkol et al. , 2006 ; Unerman, 2000 ) . This measuring is meant for the measure of CSR revelations and non the quality portion which is usually measured by look intoing the inside informations of revelations made for each component in the Bursa Malaysia CSR Framework like environment, community, market place and workplace. The figure of word disclosed is used because it is more elaborate than mensurating the figure of paperss, pages and sentences ( Unerman, 2000 ) . Besides, the usage of figure of pages besides tends to do a doomed of information and is hard to construe ( Mohamad Zain, 1999 ) .
In add-on, the differences in taking the types of words and founts used by the different writers make the measuring utilizing the figure of paperss and pages uneffective measurings. Some writers besides tend to mensurate the different grammar to build a short sentence which conveys the same significance with long sentences ( Ratanajongkol et al, 2006 ) . This farther weakens the effectivity of utilizing the figure of sentences to mensurate the extent of CSR revelations as compared to the figure of words disclosed.
Furthermore, Yusoff ( 2004 ) strengthens the usage of content analysis in mensurating the CSR revelations which can assist research workers and the populace to understand the motivations behind the concern operation which is either for net income devising intents or for the interest of the populace at big by giving back the net income earned through CSR activities.
Sample Selection and Data Collection
Sekaran ( 2006 ) has highlighted the importance of taking the right sample size to enable the research worker to generalize the findings of the survey to the whole population confidently. The research sample must run into the preciseness demand in which ( some info losing here ) and a assurance degree of 95 per centum. Sekaran, ( 2006, p. 296 ) has quoted that “ there are some factors impacting determinations on sample size including the assurance interval, the assurance degree, the sum of variableness in the population, the cost and clip restraints and the size of the population ” . On the other manus, Cooper and Schindler ( 2008 ) have besides specified some rules in act uponing sample size determination which conclude that the greater the desired preciseness and the smaller the coveted mistake of estimations, the larger the sample size demands to be provided.
This survey applied the simple random trying to choose sample companies from a population of 649, 636 and 634 companies listed on the chief board of Bursa Malaysia in 2006, 2007 and 2008 severally. It besides checked against the handiness of the one-year studies for each sampled twelvemonth which were 2006, 2007 and 2008 to mensurate the influence of the companies ‘ resources on CSR revelations.
Sekaran ( 2009 ) suggested 242 sample size for a 650 population size which has considered all the precisenesss and assurance degrees. This is supported by Raosoft Inc. ( 2010 ) and Creative Research Systems ( 2010 ) who provided a sample size reckoner to simplify the research worker ‘s work in finding the right sample size for his research.
Based on this method, 250 public listed companies with the fiscal twelvemonth stoping 31 December were indiscriminately selected to extinguish the component of biasness in the sample choice. However, companies which did non hold a complete set of one-year studies from 2006 to 2008 or were delisted from the chief board in 2008 were excluded from the sample therefore go forthing 242 companies as the sample.
In add-on, the companies ‘ resources which were touchable assets and intangible assets, purchase and ROA information were extracted from the information watercourse. Meanwhile the extent of CSR revelations which is measured by the figure of words disclosed were extracted from the one-year studies and counted utilizing Microsoft Word ‘s word count. On the other manus, the authorities ownership and household ownership information were extracted from their one-year studies which were downloaded from Bursa Malaysia ‘s web site.
The non-financial companies were excluded from these samples due to the different regulative demands and besides the stuff difference in their types of operations ( Ahmed & A ; Courtis, 1999 ; Cheng & A ; Courtenay, 2006 ; Depoers, 2000 ; Gray et al.,1995 ; Raffournier, 1995 ) . Even though the per centum of these samples was little, 152 companies were chosen because they had an equal degree of resources to analyze the influence of the companies ‘ resources on the corporate duty disclosures in an economic crisis.
Besides that, the fiscal informations were retrieved for a 3-year period from January 2006 to December 2008 to measure the revelation trends among the public listed companies after the launching of Silver Book in 2006 and during the planetary economic crisis from 2007. The authorities has provided the guidelines and rules through the launching of the Silver Book in 2006 to assist Government-Linked Companies ( GLCs ) in pull offing and measuring the CSR activities for the benefits of their stakeholders at big.
This Silver Book is hoped to better the degree of CSR revelations among the GLCs and finally promote other companies to go active function theoretical accounts for community development particularly in the planetary economic crisis. Therefore, there is a demand to reexamine the companies ‘ revelations of CSR in 2007 and 2008 to analyze the influence of the scarceness of resources in the economic crisis on the CSR activities among the public listed companies in Malaysia.
Measurement of Variables
The right measuring for each dependant, independent, interceding and control variables is of import to guarantee that accurate consequences can be generated in order to accomplish the aim of this survey. Word count is used to mensurate the figure of CSR information disclosed in the one-year studies ( Darus et al. , 2009 ) .
In add-on, touchable and intangible assets are measured by utilizing the shutting sum of touchable and intangible assets disclosed in the balance sheets. On the other manus, the mediating variables which comprise of household ownership is measured by ciphering the per centum of household members sitting on the board over the entire figure of BOD ( Darus et al. , 2009 ) . Another interceding variable is the authorities ownership which is measured by ciphering the per centum of portions owned by authorities bureaus like Khazanah Nasional, PNB, KWSP, LTAT, LTH and MKD over the figure of portions issued ( Darus et al. , 2009 ) .
The two control variables are leverage ratio and profitableness. The purchase ratio is measured by spliting the entire sum of debts with the entire sum of assets ( Xiou & A ; Yuan, 2007 ; Rashid & A ; Lodh, 2009 ) . The degree of the companies ‘ profitableness is measured utilizing ROA by spliting net incomes before involvement and revenue enhancements with the sum of entire assets ( Rashid & A ; Lodh, 2009 ) .
Table 1 Measurement of variables