Corporate social responsibility disclosure and its determinants in the Yemeni banking sector

Abstract

The objective of the current study is to provide empirical evidence on Corporate Social Responsibility (CSR) practices in banks in Yemen. The present study focuses on the quantity and quality of CSR disclosure. To achieve this, it analyses the annual reports of 18 banks from 2011 until 2013. In addition, the current study is also enriched with an analysis of the determinants of CSR disclosure. The theoretical framework is based on legitimacy theory. It is argued that bank size, profitability, foreign share ownership and government share ownership would determine CSR disclosure (in terms of quantity and quality). The results indicate that, overall, the quantity and quality of CSR disclosure in Yemen banks are low. The regression analysis maintains that size, foreign share ownership and government share ownership have a positive impact on the quantity of CSR disclosure and to a lesser extent, the quality of CSR disclosure. On the other hand, profitability has a negative impact on both quantity and quality of CSR disclosure. However, this impact on quality is not significant. The variable government share ownership is considered an important factor of CSR disclosure on quantity and quality. It explains why banks in Yemen disclose information of CSR more than other factors such as size, profitability and foreign share ownership. In conducting this study, the findings fill the gap in the literature, specifically in the context of Yemen.