Revisiting the relation between geographical diversification and corporate social responsibility: the role of segment disclosure (SFAS 131) and institutional environment

Mohamed Toukabri () and Mohammed Abdulkareem Adawi ()
Additional contact information
Mohamed Toukabri: King Khalid University
Mohammed Abdulkareem Adawi: Department of Business, Applied College in Khamis Mushait, King Khalid University

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2025, vol. 27, issue 10, No 48, 24455-24490

Abstract: Abstract Previous research has provided contingent results on the relationship between geographic diversification and corporate social responsibility. We revisit this relationship by studying the different levels of corporate social responsibility (CSR) disclosure of the largest US multinationals, using a more rigorous research design. We improve on the previous literature by focusing on geographic segment information under Financial Accounting Standards Statement No. 131 (SFAS 131) and by developing two reliable measures of geographic diversification (Geographic Diversification Depth, Geographic Diversification Breadth). These new measures capture the level information of geographic diversification that the measures used by previous studies. From a sample of 1108 multinationals in 22 countries encompassing 11,080 observations over a period spanning from 2009 to 2018, we find that the geographical diversification of multinationals is negatively associated with CSR scores, which is consistent with the explanation of social interaction. A DID approach shows that the results hold when controlling for endogeneity between geographic diversification and CSR. Moreover, the overall effect of associating higher levels of CSR disclosure with higher levels of geographic diversification is stronger in countries with more democracy, more government effectiveness, and better regulatory quality. Therefore, host country-level characteristics affect the social and environmental behavior of geographically diversified and cross-listed multinationals in the USA.

Keywords: CSR; Geographical diversification; SFAS 131; Institutional environment (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10668-023-03390-y Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:endesu:v:27:y:2025:i:10:d:10.1007_s10668-023-03390-y

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/10668

DOI: 10.1007/s10668-023-03390-y

Access Statistics for this article

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development is currently edited by Luc Hens

More articles in Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().