The Influence of Human Capital on the Quality of Corporate Social Responsibility Disclosure

The objective of the study is to examine whether the level of human capital influences the extent of corporate social responsibility (CSR) quality disclosures in Malaysian Public Listed Companies (PLCs). Information on human capital and the extent of CSR quality disclosures are obtained from the content analysis of annual reports of 150 PLCs in Malaysia for year 2009 to year 2011. Human capital is represented by human capital efficiency (HCE), top management team education level (TMT:EDU) and top management team international experience (TMT:IEX). Of these variables, the results revealed that only TMT:EDU level strongly influenced the extent of CSR quality disclosures for all the three year samples. Nevertheless, these results indicate the potential benefits of human capital as important corporate resource in developing and implementing quality CSR initiatives and disclosures. Over time, through various human capital development, relevant individuals within an organisation will understand and appreciate the concept and benefits of CSR that is crucial in supporting the promotion of quality CSR initiatives and disclosures as business strategies to create and sustain competitive advantage.