Corporate Social and Environmental Performance: A Comparative Study Between Indonesian Companies and Multinational Companies (MNCS) Operating in Indonesia

Hasan Fauzi


This study addresses the following research questions: Are there any significant social and environmental performance differences between Indonesian companies and MNCs operating in Indonesia? Do the levels of social and environmental performances have positive association with financial performance? This study uses the approach to measurement of corporate social and environmental performance (CSEP) and applies each component of the CSR to determine the index of CSEP disclosure contained in the CARs. This variable includes the following components: human resource, community involvement, and environmental performance. The findings of the study are that in terms of social variable, the performance of Indonesian companies and MNCs is the same, while in terms of environmental perspective, performance of MNCs is better than the one of Indonesia companies. In Indonesian companies, the relation of corporate social and environmental performance does not exist, while in MNCs the relation is partially supported for social perspective and mostly supported for environmental perspective.


Al-Khadash, Husam Aldeen. 2003 “The Accounting Disclosure of Social and Environmental Activities A Comparative Study for the Industrial Jordanian Shareholding Companies”. Abhath Al-Yarmouk Journal: Humanities and Social Sciences.

Beattie, Vivien, Bill McInnes and Stella Fearnley. 2002.” Narrative Reporting by Listed UK Companies: A Comparative Within-Sector Topic Analysis”. http:// page.htm

Charles-Henri, D‟arcimoles and Stéphane, Trebucq. 2002. “The Corporate Social Performance -Financial Performance Link: Evidence from France”.

Carroll, A. B. 1979. „A Three Dimensional Conceptual Model of Corporate Social Performance‟. Academy of Management Review 4: 497–505.

Clarkson, M. B. E.: 1995, „A Stakeholder Framework for Analyzing and Evaluating Corporate Social Performance‟, Academy of Management Review 20(1), 92–117.

Dean, Lund Kathy.1997.The Chicken and The Egg Revisited: Ties Between Corporate Social Performance and the Financial Bottom Line”Journal of Applied Psychology 82.

Fauzi, Hasan. 2002. “The Use of Stakeholder Concept in Improving Corporate Performances”. Unpublished paper in MM Discussion Forum.

___________.2004. “Identifying and Analyzing the Level of Practices of Company‟s Social Responsibility in Improving Corporate Financial Performance”. Forthcoming in Journal of Business and management.

Gerde, V. W. and R. E. Wokutch: 1998. „Twenty five years and Going Strong. A Content Analysis of the First 25 years of the Social Issues in Management Division Proceedings‟. Business & Society 37(4): 414–446.

Igalens, Jacques and Jean-Pascal Gond. 2005 “Measuring Corporate Social Performance: A Critical and Empirical Analysis of Arese Data”. Journal of Business Ethics 56(2).

Itkonen, Laura. 2003. Corporate Social Responsibility and Financial Performance. http:// Courses_and_schedules/Isib/TU- 91.167/Old_seminar_papers Itkonen_Laura.pdf.

Iu, Justin and Clowes, Courtney. 2001. An Approach to Evaluating Accounting Narratives: a Corporate Social Responsibility Perspective.

Ite, Uwem E. 2004. Multinationals and corporate social responsibility in Developing countries: A Case Study of Nigeria” Corporate Social - Responsibility and Environmental Management 11(1).

Johnson, Richard A and Daniel W Greening. 1999. “The effects of Corporate governance and institutional ownership types on corporate Social Performance”. Academy of Management Journal 425).

Lewis, Geoffrey & Tatiana Minchev. 2002. Firm resources: The still missing link in international diversification - performance research. Proceedings of the AIB Southeast Asia 2002 Conference, Shanghai, July.

Mahoney, Lois and Robin Roberts. 2002. Corporate Social and Environmental Performance and Their Relation to Financial Performance and Institutional Ownership: Empirical Evidence on Canadian Firm.

Mangos, Nicholas and O‟Brien Peter. 2000. Investigating Social Responsibility Reporting Practices of Global Australian firms and how those Practices enhance Economic Success. http://

Moore, Geoff. 2001. “Corporate Social and Financial Performance: An Investigation in the UK Supermarket Industry”. Journal of Business Ethics (vol 34: 299-315).

Orlitzky, Marc. 2001. “Does Firm Size Confound the Relationship between Corporate Social Performance and Firm Financial Performance?” http://www.ssn.flinder aig/accsymp/accsymp2001/orlitzky.doc

Riordan, Cristine M., Robert D Gatewood. And Jodi Barnes Bill. 1997. “Corporate Image: Employee Reactions and Implications for Managing Corporate Social Performance”. Journal of Business Ethics 16: 401-412.

Stanwick, Peter A. and Sarah Stanwick. 1999. “The Relationship Between Corporate Social Performance, and Organizational Size, Financial Performance, and Environmental Performance: An Empirical Examination”. Journal of Business Ethics 17: 195-204.

Simerly, Roy L. and Li, Minfang. 1999. Corporate Social Performance and Multinationality: A Longitudinal Study.

Tsoutsoura, Margarita. 2004. Corporate Social Responsibility and Financial Performance. Working Paper Series (University of California, Berkeley).

Thomas, Paula B and Sara York Kenny. 1997. Environmental Reporting: A Comparison of Annual Report Disclosures And Popular Financial Press Commentary. http://www.

Waddock, S. and Graves, S. 1997. “The Corporate Social Performance-Financial Performance Link”. Strategic Management Journal 18(4): 303-319.

Wartick, S. L. and P. L. Cochran. 1985. “The Evolution of the Corporate Social Perfromance Model‟‟. Academy of Management Review 10(4): 758–769.

Wood, D. J. 1991, “Corporate Social Performance Revisited”. Academy of Management Review 16(4): 691–718.


Jurnal Akuntansi dan Bisnis (JAB)
ISSN 1412-0852 (print), 2580-5444 (online)
Published by Accounting Study Program, Faculty of Economics and Business, Universitas Sebelas Maret, Indonesia

Creative Commons License
JAB on is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License

Visitor Statistic