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Corporate Disclosure in Relation to Combating Corporate Bribery: A Case Study of Two Chinese Telecommunications Companies

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  • Muhammad Azizul Islam
  • Shamima Haque
  • Thusitha Dissanayake
  • Philomena Leung
  • Karen Handley

Abstract

type="main"> This paper investigates the association between global community concerns about bribery activities and anti-bribery disclosure practices by two Chinese telecommunication companies operating internationally, namely China Mobile and ZTE. Based on content analysis of annual reports and global news media articles over a period of 16 years from 1995–2010, the findings suggest that the changes in the level of disclosures by the two major Chinese telecommunications companies were closely associated with the level of international concerns over bribery practices within the Chinese telecommunications industry. This finding indicates that the companies adopt anti-bribery disclosure practices in order to minimise the gap of trust (social capital) between companies themselves and global stakeholders. In this paper we argue that, for domestic companies in China, culturally constructed social capital, such as guanxi , creates a level of trust between managers and their stakeholders, which obviates the need for managers to disclose anti-bribery performance information. However, for companies operating internationally, as social capital is inadequate to bridge the gap of trust between managers and global stakeholders, managers use disclosures of anti-bribery performance information as a way to minimise such a gap.

Suggested Citation

  • Muhammad Azizul Islam & Shamima Haque & Thusitha Dissanayake & Philomena Leung & Karen Handley, 2015. "Corporate Disclosure in Relation to Combating Corporate Bribery: A Case Study of Two Chinese Telecommunications Companies," Australian Accounting Review, CPA Australia, vol. 25(3), pages 309-326, September.
    • Handle: RePEc:bla:ausact:v:25:y:2015:i:3:p:309-326
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    References listed on IDEAS

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    2. Shan Xu & Duchi Liu, 2018. "Do Financial Markets Care about Corporate Social Responsibility Disclosure? Further Evidence from China," Australian Accounting Review, CPA Australia, vol. 28(1), pages 79-103, March.
    3. Whitehead, Martin & Belghitar, Yacine, 2022. "Responding to a corruption crisis through disclosure and remedial action: The case of Petrobras," The British Accounting Review, Elsevier, vol. 54(5).
    4. Md. Abdul Kaium Masud & Mahfuzur Rahman & Md. Harun Ur Rashid, 2022. "Anti-Corruption Disclosure, Corporate Social Expenditure and Political Corporate Social Responsibility: Empirical Evidence from Bangladesh," Sustainability, MDPI, vol. 14(10), pages 1-20, May.
    5. Maider Aldaz Odriozola & Igor Álvarez Etxeberria, 2021. "Determinants of Corporate Anti-Corruption Disclosure: The Case of the Emerging Economics," Sustainability, MDPI, vol. 13(6), pages 1-17, March.
    6. Tiyas Kurnia Sari & Fitra Roman Cahaya & Corina Joseph, 2021. "Coercive Pressures and Anti-corruption Reporting: The Case of ASEAN Countries," Journal of Business Ethics, Springer, vol. 171(3), pages 495-511, July.
    7. Laura Broccardo & Francesca Culasso & Amandeep Dhir & Elisa Truant, 2023. "Corporate social responsibility: Does it really matter in the luxury context?," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(1), pages 105-118, January.
    8. Musa Ghazwani & Mark Whittington & Akrum Helfaya, 2023. "Assessing the Anti-Corruption Disclosure Practices in the UK FTSE 100 Extractive Firms," Sustainability, MDPI, vol. 15(6), pages 1-33, March.
    9. Kouznetsov, Alex & Kim, Sarah & Wright, Chris, 2019. "An audit of received international business corruption literature for logic, consistency, completeness of coverage," Journal of International Management, Elsevier, vol. 25(4).
    10. Renata Blanc & Charles H. Cho & Joanne Sopt & Manuel Castelo Branco, 2019. "Disclosure Responses to a Corruption Scandal: The Case of Siemens AG," Journal of Business Ethics, Springer, vol. 156(2), pages 545-561, May.

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