Value Relevance of Accounting Numbers : Determinants of Corporate Social Responsibility (CSR) Disclosures of Islamic Banks in Malaysia

Rosnia Masruki, Nurazalia Zakaria and Norhazlina Ibrahim (Universiti Sains Islam Malaysia)


The objective of this study is to examine whether corporate social responsibility (CSR) disclosures are influenced by the bank-specific factors namely bank leverage, size, and profitability in Islamic banks in Malaysia. It relates to the value relevance of accounting numbers which intended to assess how well accounting numbers reflect the determinants of CSR among Malaysia Islamic Banks. The deteminants of CSR dicslosures are investigated using both the Stakeholder Theory and the Agency Theory. This paper hypothesized that lowly leveraged banks will tend to make larger donations than highly leveraged banks. Therefore, leverage negatively influences the disclosure of CSR. Large and profit banks will tend to be involved in social role than small and less profitable banks. Thus, there is a positive association between corporation social role and the bank's size and profit. There are seventeen fully fledged Islamic banks in Malaysia. Logit regression is used to test empirically whether the CSR is highly influenced by the factors identified earlier. The empirical evidence supports only one of the predictions. Specifically, the results infer the fact that the CSR disclosures are significant and positively associated to the bank size only. This contradicts with the leverage and profitability, which provides no support. Nonetheless, the study provides some contribution on factors that contribute to the disclosure of CSR.


Download PDF :

JMIFR - Vol 9, No.1 2012 - Part 5.pdf

This site is best viewed with a resolution of 1024 x 768 (or higher) and supports Microsoft Internet Explorer / Mozilla Firefox / Google Chrome
The Journal of Muamalat and Islamic Finance Research (JFIMR) , Universiti Sains Islam Malaysia (USIM), Bandar Baru Nilai, 71800 Nilai. Negeri Sembilan. Malaysia. Telephone: 606-798 6317 / 6305 / 6306  Fax: +606-798 6302  Email: This email address is being protected from spambots. You need JavaScript enabled to view it.   2018 © Fakulti Ekonomi & Muamalat (FEM), USIM