Impact of chief financial officer’s experience on the assurance of corporate social responsibility reports in China
ISSN: 1746-5680
Article publication date: 8 April 2022
Issue publication date: 20 October 2022
Abstract
Purpose
Given the emerging importance of the chief financial officer’s (CFO) role, this study aims to probe into the prevalence of corporate social responsibility (CSR) assurance practices in China and to examine whether or not CFO foreign, professional or academic experience affects the likelihood of CSR assurance decision.
Design/methodology/approach
All A-share listed Chinese companies during the year 2008–2017 with 5,144 firm-year observations have been investigated for this study.
Findings
This study finds a positive effect of CFO foreign and professional experience on CSR assurance. No significant association has been found between the CFO’s academic experience and CSR assurance. Additional analysis for Global Reporting Initiative (GRI) sampled firms shows that the academic and professional experience of CFOs has a significant positive association with CSR assurance. However, the main findings are replicated in the case of firms under mandatory CSR reporting.
Research limitations/implications
The limitations of this study are its generalizability, unidimensional measure of CSR assurance which is unable to capture its quality and explore the other traits of CFOs.
Practical implications
It provides assurance practitioners with valuable longitudinal data on China’s CSR reporting and assurance services. Also, firms should recognize the importance of having competent CFOs to improve the credibility of their CSR reporting. The cross-sectional variation analysis (GRI and mandatory CSR) will help firms to assess the value of each CFO attribute for their nonfinancial reporting and auditing choices while considering internal and external stakeholder demands.
Originality/value
This study not only updates the existing understanding of CSR assurance methods in China but also explains the significance of CFO-specific experience in enhancing the credibility of nonfinancial reporting.
Keywords
Acknowledgements
This research was supported by the ‘Scientific Research Fund’ (Grant No. US21021) of the Research Institute of the Guilin University of Electronic Technology. The authors would also like to thank the Editor and two anonymous reviewers for their helpful insights.
Conflict of interest: The authors declare that they have no conflict of interest.
Citation
Khalid, F., Naveed, K., He, X. and Ye, C. (2022), "Impact of chief financial officer’s experience on the assurance of corporate social responsibility reports in China", Society and Business Review, Vol. 17 No. 4, pp. 613-635. https://doi.org/10.1108/SBR-10-2021-0190
Publisher
:Emerald Publishing Limited
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