Journal
REVISTA DE CONTABILIDAD-SPANISH ACCOUNTING REVIEW
Volume 19, Issue 1, Pages 142-153Publisher
UNIV MURCIA
DOI: 10.1016/j.rcsar.2015.10.001
Keywords
Composite index; Corporate social responsibility (CSR); CSR evaluation; Electricity utility industry; Social dimension
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Corporate social responsibility is a multidimensional concept that is often measured using diverse indicators. Composite indices can aggregate these single indicators into one measurement. This article aims to identify the key challenges in constructing a composite index for measuring corporate social responsibility. The process is illustrated by the construction of a composite index for measuring social outcomes in the electricity utility industry. The sample consisted of seventy-four companies from twenty-three different countries, and one special administrative region operating in the industry in 2011. The findings show that (1) the unavailability of information about corporate social responsibility, (2) the particular characteristics of this information and (3) the weighting of indicators are the main obstacles when constructing the composite index. We highlight than an effective composite index should has a clear objective, a solid theoretical background and a robust structure. In a practical sense, it should be reconsidered how researchers use composite indexes to measure corporate social responsibility, as more transparency and stringency is needed when constructing these tools. (C) 2015 ASEPUC. Published by Elsevier Espana, S.L.U.
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