How accountants of Kenyan listed companies perceive and construe the intention to disclose social responsibility information

Abstract

This study aimed to examine the Corporate Social Disclosure (CSD) practices of listed companies in Kenya, and the perception, constructs and intentions of accountants to disclose social responsibility information. This study was exploratory in nature. Current CSD practices of listed companies in Kenya were expected to be brought out through the use of disclosure indices and determine how accountants perceive and construe CSD, through the use of repertory grid technique. In order to calculate the disclosure index, data were obtained from the annual reports of the respective companies. The indices were then regressed against different company characteristics and corporate governance variables that affect CSD to determine which variables influence disclosures and which do not. In the case of repertory grid, interviews were conducted with accountants from both low disclosure and high disclosure companies. The repertory grid data were analysed in two stages: individual cases analysis and cross-cases analysis. The individual case were analysed using the principal component analysis. For the cross-cases analysis, content analysis was used to categorize constructs based on their expressed meaning. The findings indicate that CSD has increased over the years for all the companies that were studied. The themes disclosed varied according to size, profitability, liquidity, ownership of the company and the industry in which the company operates. It was also found that the reputation of the company is the main motivation for high disclosure companies to disclose social responsibility information. Low disclosure companies are mainly motivated by institutional factors. It is recommended that regulation and standardisation of CSD can make it more useful for decision-making by various stakeholders.