IMPACT OF OWNERSHIP STRUCTURE ON CSR DISCLOSURE QUALITY

Abstract

         This research examines the relationship between ownership composition and corporate social responsibility (CSR) disclosure quality in Pakistan, a developing economy. The research examines the influence of different ownership structures—government, institutional, concentrated, and foreign ownership—on CSR disclosure standards. Using the theoretical lenses of legitimacy theory, agency theory, and stakeholder theory, the research examines the influence of ownership type on CSR reporting and transparency conventions. Financial statement data and annual reports of 231 non-financial firms listed on the Pakistan Stock Exchange (PSX) made up the balanced panel dataset analyzed. Three constructs—sustainable development, environmental management, and pollution prevention—were employed as main proxies of CSR transparency in the text analysis employed to measure the quality of CSR disclosures. Among some of the independent variables are ownership arrangements and their effects on corporate governance and corporate social responsibility. Director ownership negatively affects because of interest conflict, but institutional ownership positively affects due to shareholder pressure on CSR disclosure quality. Because of differences in expectations, foreign ownership is an additional complication of CSR operations. The study further examines Islamic values' effects on CSR disclosure openness and acknowledges the way COVID-19 reshaped CSR standards in disclosure. Further, research in the article reiterates how board diversity influences better CSR reporting and for instance, the role played by national diversity in influencing disclosure quality. Through its study of the effects of ownership structure as well as disclosure quality in the quality of CSR disclosures, the paper contributes knowledge on this research aspect.