Corporate Social Responsibility Research Review

This assignment requires a review of various academic articles related to Corporate Social Responsibility (CSR). You need to analyze each article, noting key details such as author, date, title, journal, type of paper (theoretical or empirical), research methods used, variables studied, and a 100-word summary of the article's contribution to the field. The assignment includes articles exploring different aspects of CSR, from its impact on firm value to its relationship with tax aggressiveness and legitimacy theory.

Running head: CONTEMPORARY ISSUES IN ACCOUNTING
Contemporary Issues in Accounting
University Name
Student Name
Authors’ Note

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CONTEMPORARY ISSUES IN ACCOUNTING
Table of Contents
Practical Motivation...................................................................................................................2
Theoretical Motivation...............................................................................................................3
Literature Review and Hypothesis Development......................................................................5
Base of Legitimacy Theory........................................................................................................5
Responses to legitimacy problem...............................................................................................6
Legitimacy Problem or else crisis..............................................................................................6
Societal Concern (climate change score for the nation).............................................................7
References..................................................................................................................................9

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CONTEMPORARY ISSUES IN ACCOUNTING
Introduction
Legitimacy is a comprehensive perception or else supposition that the actions of a particular
business entity are essentially desirable, appropriate within certain socially constructed
system of standards, beliefs as well as definitions. Legitimacy theory can be considered as
one of the most important theories within the social as well as environmental accounting area.
In essence, the novel economic, social as well as environmental challenges direct
corporations and the government to abide by the regulations, values, standards and norms and
to willingly divulge social as well as environmental information in a bid to investigate their
conformity. The present study explains legitimacy theory that can play an important role of a
justifiable facet for the disclosure of specific environmental information.
Practical Motivation
Nowadays corporations are the primary source of emissions of carbon and carbon footprints
are day by day rising. Reports reveal that the CO2 emissions in Australia per capita are
registered to be 16.35 metric tons recorded during the year 2013. Australia’s National
Greenhouse Accounts keep track of regional emissions during the period 1990 and onwards
meet the reporting commitments specified under the United Nations Framework Convention
on change of climate, track advancements as against commitment of emissions reduction of
Australia and inform makers of policy as well as the public(Abs.gov.au 2017). Analysis of
environmental reports reflect the fact that the emissions are mainly due to the electricity,
direct combustion, transport, fugitives, industrial procedures, agriculture, waste, land use
change as well as forestry (Fernando and Lawrence 2014).
However, emission during the year 2030 is projected to roughly around 592 Mt CO2 -e,
which is essentially 0.5% below the ones recorded during the year 2005. This is primarily due
to rising awareness and higher social concerns for the environment. Lanis and Richardson

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CONTEMPORARY ISSUES IN ACCOUNTING
(2016) asserts that societal concerns for the environment has also escalated and government
regulations as regards emissions of carbon. Corporations are also under growing pressure to
display their level of commitment to lessening their contribution to alterations in climate to
avert further increase in directive (Mousa and Hassan 2015). The International panel on
climate change introduced during the year 1988 by the World Meteorological Organisation as
well as the United Nations Environment also declared that the overall warming of the climate
system is essentially unequivocal and it is hereby very likely that the emissions of the green
house gases from diverse human actions have led to increase in the global temperature
witnessed since the period of 1990s. Thus, it can be hereby said that the greenhouse gas
emissions of Australia have steadily amplified between the period 1991 and the year 2008.
Australia has certain emission control procedures and policies in place to lessen the overall
greenhouse gas emissions by no less than 5%. Analysis of policy trends show that the current
trend in Commonwealth Emission Control Policy laid emphasis on the mandated expansion
of the overall amount of electricity generated by diverse renewable resources, development of
emission offsets, energy efficiency measures (Noronha et al. 2014). Furthermore, this
includes imposition of fuel emissions, provision of financial incentive, continued financing of
research and development exercises and continued participation in worldwide change in
climate.
Theoretical Motivation
As rightly indicated by Rogowski (2015) worldwide financial crisis along with instability of
the overall financial markets create pressure on the corporation to re-assess the value system
present. This also helps to emphasize the significance of legitimacy. Prior academic theories
reflect that legitimacy theory is for a moment observed as a plausible illustration of
managerial motivations without any genuine effort to determine the way a disclosure might

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CONTEMPORARY ISSUES IN ACCOUNTING
or might possibly not promote transparency as well as accountability towards diverse non-
capital provider stakeholders. Menassa and Brodhäcker (2017) assert that it is not like an
instrument that can be used for the purpose of arriving at feasible predictions. Therefore,
organizations need to voluntarily divulge social as well as environmental information in a bid
to legitimate their specific legitimacy. The disclosure of specific information need to be
accompanied by concrete activities that are necessarily realised in conformation to specific
social as well as environmental standards and values. The theoretical nature of legitimacy
also makes it intricate to discover the mechanism by which corporations are motivated to
willingly reveal social as well as environmental information.
As correctly mentioned by Glozer et al. (2014), the legitimacy theory has a rich disciplinary
background founded on the theory of management, institutional theory as well as stakeholder
theory. Paradoxically, the main role of legitimacy of corporations, institutions as well as
social survival is necessarily motivated by diverse negative social along with environmental
phenomena generated by inadequacy of legitimacy. Ehrenberg and Smith (2016) opine that
legitimate literature proposes that the survival of a particular corporation relies on process of
legitimation procedures and on the way unremitting pressures as well as challenges can be
handled. However, the primary purpose of the procedure of legitimation is to acquire and
maintain the approval of the shareholder. In addition to this, legitimacy theory provides
researchers as well as wider public a proper way to analytically unpack corporate disclosures.
Nevertheless, the comprehension with the study of the specific theory can become more
refined, drawing on expansion within the prior literature.

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CONTEMPORARY ISSUES IN ACCOUNTING
Literature Review and Hypothesis Development
Base of Legitimacy Theory
The prior academic themes on legitimacy theory and social agreements states that disclosures
might be used by different corporations in order to demonstrate to the entire society that they
are necessarily fulfilling their obligations to all the stakeholders of the firm. Miller and Power
(2013) asserts that the legitimacy theory proposes that the corporations persistently seek to
institute congruence between social values associated with or else implied by organizational
activities along with the community and bounds instituted by the community of which they
are a fraction. However, the need to show that a corporation is functioning in a socially
acceptable way is considered to be at the base of this specific legitimacy theory.
It is anticipated corporations engaged in social as well as environmental events might
probably affect apparent legitimacy. This can direct firms to undertake disclosure stratagem
to illustrate and at the same time excuse any negative facets of corporate performance. The
firms also need to undertake actions in order to redirect the overall attention of the
corporation in a bid to maintain community’s level of acceptance of their actions. Tucker and
Hoque (2017) opine that legitimacy can be considered to be a status or else condition that are
necessarily an outcome of community’s collective perception regarding the operation of the
corporation. However, it is a social evaluation or else process of assessment of the overall
corporate conduct that is regarded to be acceptably, apt and the same time desirable.
Research Question
Research question that can be posted for the study is as presented below:
-Does industry profile influence the voluntary environmental disclosure?

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CONTEMPORARY ISSUES IN ACCOUNTING
Responses to legitimacy problem
Environmental disclosures also increased at the time when various environmental events
along with penalties became the main focus of the media attention. However, major
corporate incidents such as poisonous gas emissions, spilling of oil or else chemical leakages
can take place in the society. Essentially, this leads to high environmental, financial as well as
social consequences to both the corporation along with the wider community. In this case,
from the corporation’s standpoint community response might possibly include legal limit,
enhanced difficulty accessing both financial and non-financial resources and diminished
demand. In particular, in such cases whereby community perceives that a corporation’s cost
is higher than its own benefit to community, a corporation might risk sanctions forced upon
by the community to continue to own and make use of resources and finally its very existence
might get threatened (Henderson et al. 2015). On the contrary, the corporations that manage
to properly communicate
Legitimacy Problem or else crisis
Legitimacy theory essentially offers an effective mechanism for comprehending voluntary
social as well as environmental disclosures specifically and as a notion in general. The
legitimacy theory can become one of the most significant theories within both the social as
well as environmental area. This is essentially not an issue for the entire theory and the entire
observation can be equally implemented to a wide range of different theories in a range of
diverse disciplines. Corporations intend to manage the legitimacy as it assists in ensuring the
persistent capital flow, labour as well as customers necessary for viability. In addition to this,
this also forestalls regulatory actions by the state that probably might occur in the
nonexistence of legitimacy. As rightly indicated by Mouritsen (2014), legitimacy might be
threatened by a specific event and thus call for the need for defence. Legitimation actions

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CONTEMPORARY ISSUES IN ACCOUNTING
have the tendency to be both intense and at the same time reactive since management
attempts to defend the threat. Even excluding a major event, it is probable in the Western
Capitalist System that more or less every company might need to defend the legitimacy, by
the plain fact that the companies need to satisfy both competences with community
requirement in a bid to realize legitimacy.
Societal Concern (climate change score for the nation)
Australia is anticipated to surpass the overall emissions reductions in order to meet the target
by 2020 by around 97 Mt CO2. This is also on addition to the carryover of approximately 128
Mt of CO2 –e (Abs.gov.au 2017). There are different facets that contribute towards the
changes in environmental score. This essentially includes the inclusion of abatement during
the period 2021 to the year 2030 from present contracts under the Australia’s Emissions
Reduction Fund. The other important factor includes commitment of the government to a
huge scale renewable energy target of nearly 33000 GWh (Abs.gov.au 2017). Again, the
declarations of the forthcoming closure of Hazelwood power station situated in Victoria also
contributed towards the environmental change of score. Again, flatter demand for electricity
than formerly projected owing to enhancement in energy efficiency and revised anticipations
for growth in specifically renewable generations also lead to change in climate score.
The current study helps in understanding the legitimacy theory with special orientation to
environmental factors (change in climate) based on the review of the available literature. The
first part of the current study refers to the practical as well as theoretical motivation that helps
in understanding climate change, potential sources of carbon emissions and environmental
degradation, societal concern for environmental concerns, government regulations increasing
pressure to demonstrate the commitment to minimize the contribution
(Plumlee et al. 2015). Moving further, the study presents a detailed review of literature and

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CONTEMPORARY ISSUES IN ACCOUNTING
presents a hypothesis for the study. This essentially provides theoretical constructs along with
operational proxies (Raida Chakroun et al. 2017).
Relationship between proxies
Corporations with record of good performance when encounters legitimacy problems set
challenging targets. However, corporations with records of bad performance when face
legitimacy problems seek to alter attitudes regarding what are acceptable.

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CONTEMPORARY ISSUES IN ACCOUNTING
References
Abs.gov.au. 2017. Australian Bureau of Statistics, Australian Government. [online] Available
at: http://www.abs.gov.au [Accessed 4 Sep. 2017].
Ehrenberg, R.G. and Smith, R.S., 2016. Modern labor economics: Theory and public policy.
Routledge.
Fernando, S. and Lawrence, S., 2014. A THEORETICAL FRAMEWORK FOR CSR
PRACTICES: INTEGRATING LEGITIMACY THEORY, STAKEHOLDER THEORY
AND INSTITUTIONAL THEORY. Journal of Theoretical Accounting Research, 10(1).
Glozer, S., Caruana, R. and Hibbert, S.A., 2014, January. Constructing Legitimacy in Online
Corporate Social Responsibility Communication. In Academy of Management
Proceedings (Vol. 2014, No. 1, p. 15051). Academy of Management.
Henderson, S., Peirson, G., Herbohn, K. and Howieson, B., 2015. Issues in financial
accounting. Pearson Higher Education AU.
Lanis, R. and Richardson, G., 2016. A Reply to Corporate Social Responsibility and Tax
Aggressiveness: A Test of Legitimacy Theory. Social and Environmental Accountability
Journal, 36(1), pp.90-92.
Menassa, E. and Brodhäcker, M., 2017. Grounded in legitimacy theory and deductive in
nature, this paper uses content analysis of annual report social disclosures of 169 German
‘universal’banks belonging to three different categories (credit, saving, and cooperative) to
report on the type and quantity of social disclosure by these banks, and to test seven
hypotheses related to the nature of their social disclosures and their association... Journal of
Management & Governance, 21(1), pp.119-143.

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CONTEMPORARY ISSUES IN ACCOUNTING
Miller, P. and Power, M., 2013. Accounting, organizing, and economizing: Connecting
accounting research and organization theory. Academy of Management Annals, 7(1), pp.557-
605.
Mouritsen, J., 2014. Discussion of “Accounting and Sweatshops: Enabling Coordination and
Control in Low‐Price Apparel Production Chains”. Contemporary Accounting
Research, 31(2), pp.347-353.
Mousa, G.A. and Hassan, N.T., 2015. Legitimacy Theory and Environmental Practices: Short
Notes. International Journal of Business and Statistical Analysis, 2(1), pp.41-53.
Noronha, C., Guan, J.J. and Leung, T.C.H., 2014. Further challenges to the legitimacy
theory: Corporate social disclosure of the Chinese and Japanese tobacco industries.
Working Paper.
Raida Chakroun, Hamadi Matoussi, Sarra Mbirki, 2017. "Determinants of CSR disclosure of
Tunisian listed banks: a multi-support analysis", Social Responsibility Journal, Vol. 13 Issue:
3, pp.552-584, https://doi.org/10.1108/SRJ-04-2016-0055
Rogowski, R., 2015. Rational legitimacy: A theory of political support. Princeton University
Press.
Tucker, B. and Hoque, Z., 2017. Mixed methods for understanding accounting issues. The
Routledge Companion to Qualitative Accounting Research Methods, p.301.
Plumlee, M., Brown, D., Hayes, R.M. and Marshall, R.S., 2015. Voluntary environmental
disclosure quality and firm value: Further evidence. Journal of Accounting and Public
Policy, 34(4), pp.336-361.

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CONTEMPORARY ISSUES IN ACCOUNTING
Appendix
Author Date Title Journal Type of
Paper
(Theoret
ical or
Empirica
l)
If
empirical
,
research
method
and
sample
If
empirical,
dependent
and
independe
nt
variables
100 word
summary
of
contributi
on to the
research
question
Marlene
Plumlee
, Scott
Marshal
l, Daren
Brown
2008
The Impact
of
Voluntary
Environme
ntal
Disclosure
Quality on
Firm Value
Theoreti
cal
This study
reviews
the
associatio
n between
the firm's
quality of
a specific
voluntary
environme
ntal
disclosure
s and
value of
firm, by
considerin
g the
correlation
between
different
componen
ts of value
of the firm
Roman
Lanis,
Grant
Richard
son
(201
2)
Corporate
social
responsibili
ty and tax
aggressiven
ess: a test
of
legitimacy
theory
Accountin
g,
Auditing
&
Accountab
ility
Journal
Empirica
l
A unique
sample
of 20
Australia
n
corporati
ons
dependent
variable-
level of
CSR
disclosure,
independe
nt variable
is denoted
by the
dummy
variable
tax
aggressive
ness
The main
aim of this
study is to
empiricall
y examine
the theory
of
legitimacy
by
analysing
the
corporate
social
responsibi
lity (CSR)
disclosure

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CONTEMPORARY ISSUES IN ACCOUNTING
s of
particularl
y tax
aggressive
business
concern
with those
of non-tax
aggressive
business
concerns
operating
in
Australia.
Fernand
o,
Susith;
Lawren
ce,
Stewart
2014 A
theoretical
framework
for csr
practices:
integrating
legitimacy
theory,
stakeholder
theory and
institutiona
l theory.
Journal of
Theoretica
l
Accountin
g
Research
theoretic
al
This study
presents
an
assimilate
d
theoretical
structure
for
illustrating
Corporate
Social
Responsib
ility
(CSR)
exercises
by
corporatio
ns. This
mainly
includes
conventio
nal
theories,
specificall
y
legitimacy
theory,
stakeholde
r theory as
well as
institution
al theory.
Raida
Chakrou
n,
201
7
Determinan
ts of CSR
disclosure
of Tunisian
Social
Responsibi
lity
Journal
Empirica
l
Branco
and
Rodrigue
s’ (2006
Independe
nt
Variable-
banks’
This study
intends to
examine
the extent

15
CONTEMPORARY ISSUES IN ACCOUNTING
Hamadi
Matouss
i, Sarra
Mbirki
listed
banks: a
multi-
support
analysis
and
2008)
index
that has
23 items,
11
Tunisian
listed
banks
characteris
tics and
banks’
ownership
structures,
Dependent
Variable-
CSR
disclosure
as well as
trends of
particularl
y
voluntary
corporate
social
responsibi
lity (CSR)
revelation
and to
review
diverse
indicators
of certain
listed
banks’
financial
reports as
well as
websites
in an
growing
capital
market,
that is to
say,
Tunisia.
Charles
H. Cho,
Giovann
a
Michelo
n,
Giovann
a
Michelo
n, Robin
W.
Roberts
2015 CSR
disclosure:
the more
things
change…?"
Accountin
g,
Auditing
&
Accountab
ility
Journal,
Empirica
l
Using
Fortune
500 data
of
particula
rly the
late
1970s
Independe
nt
Variable-
legitimacy
factors and
CSR
disclosure
and
Dependent
Variable-
Value of
Firm
It
investigate
s whether
CSR
reporting
vary from
the one
recorded
during the
1970s. In
addition
this paper
examines
whether
one of the
primary
findings of
previous
CSR
research
happen to
be chiefly

16
CONTEMPORARY ISSUES IN ACCOUNTING
a function
of
revelation
to
legitimacy
factors