Klaus Möller

In our knowledge-based economy, successful companies' most important assets are intangible - such as their human capital. However, few companies provide their stakeholders with detailed information about this resource, as they do not adequately assess the value of such reporting. Nevertheless, against the background of the corporate social responsibility discussion, providing human capital information is becoming increasingly important as a key driver of corporate reputation. Human capital reporting (HCR) can also be regarded as an instrument that may affect company financial performance and ultimately increase shareholder value. Against this background, we develop a theoretical model that illustrates the transformation of the intangible factors of HCR into tangible outcomes. Consequently, the model considers the various cause-and-effect relationships between HCR and company financial performance. As with a strategy map, three dimensions with a specific number of different intangible factors should be taken into consideration. Ultimately, the model reveals the benefits of HCR.

Currently, companies spend a great deal of effort on Corporate Social Responsibility (CSR) disclosures. CSR disclosure relates to the provision of information on companies' environmental and social performance. From an economic perspective, companies might disclose this information to avoid or decrease potential political costs. We construct a CSR disclosure index based on the Global Reporting Initiative (GRI) guidelines. Using content analysis, we analyze 130 listed German companies' CSR disclosures (470 firm-year observations) to investigate the determinants of these voluntary disclosure activities. Our results show that, consistent with the political cost theory, German companies' disclosures of all CSR issues are affected by their visibility, shareholder structure, and relationship with their US stakeholders. In addition, higher profitability is associated with more environmental disclosures. Finally, size and industry membership affect the amount of CSR disclosure.

Today, companies spend a lot of effort in their reporting on corporate social responsibility (CSR). CSR reporting relates to the provision of information regarding the companies' voluntary contribution to sustainable development. From an economic perspective, companies might disclose this information for avoiding/decreasing potential political costs. Based on GRI-guidelines, we use content analysis to document the amount of CSR-disclosures of stock-listed German companies. Furthermore, we focus on a number of firm-specific factors that are likely to proxy for high political and/or societal costs and argue that companies try to reduce those costs by proactively communicating specific CSR-information. In doing so, we try to explain why companies disclose CSR information. Our results show that reporting on social issues is affected by social constraints and shareholder structure. Contrary to our hypotheses is that profitability as well as the companies' relationship to US stakeholders have no influence on companies' disclosures. Finally, size and industry affect the amount of CSR-disclosure.