Corparte Social Disclosure: A Case Study On Petroleum Industry Of Pakistan Mehrunissa Chaudhry 1, Sumra Latif Mughal 2, Dr Fareeha Zafar3 1. Ms. University of Engineering and Technology
Email: [email protected]
2. Ms. Shaheed Zulfiqar Ali Bhutto Institute of Science & Technology(SZABIST)
Email: [email protected]
3. University of Derby, UK Currently working at GCU, Lahore [email protected]
Abstract: This paper eximnes intra industry variation in environment. Mitra[1] has researched on this issue CSR disclosure practice. It investigates corporate frequently and his scope of work includes, “long term Governance practices and their acts towards environment, corporation power, employer & employees safety and society and employees and business practices compliance health, environmental pro-activeness, waste rules and regulation with ethical behavior. The industry management, resource depletion and product analyzed is the petroleum industry of Pakistan. The paper finds that companies for petroleum industry showing quality.” The sole purpose of the corporations is not higher CSR profile and greater contribution towards profit maximization they also cater a wider audience CSR.The paper conclude by examining how Pakistan which includes all its stakeholders, environment and Refinery Limited, National Refinery Limited and Attock the society. In the words of Friedman 1962, the Refinery Limited have been contributing positevly towards tradional theory states that the sole purpose of any CSR. Data will be collected through open ended interviews. business is to maximize the profits of its shareholders The main aim of this study is to gather an in-depth but it does not hold today as now a days companies understanding of THE SUBJECT. are moving towards the corporate governance practices in order to build trust and confidence of its I. INTRODUCTION: stakeholders. Research have proved that the level of 1.1 Detailed Analysis of Corporate Social awareness is growing among firms for putting an obligation to help society even if it is earning loss or Responsiblity: [2] Corporate Social Responsibility is defined as the profit .The research concluded that a portion of continuing commitment by businesses to behave Profits of the organization should be utilized for the sake of sustainability and stakeholder support. ethically, and contribute to economic development [3] while improving the quality of life of the people, as The study by M. Zia Corporate Social well as the local community and society at large. In Responsibility influence on employee commitment today’s world it is imperative for an organizations and organizational performance with respect to rather than depending upon its business activities. It Pakistan. It has identified that CSR activities and has to continuously work upon its role for sustaining employees commitment are positively correlated. long term reputation and good will, commonly CSR activities by a company results in employee known as Corporate Social Responsibility (CSR) of commitment which in turn affects the overall firms. CSR comes under the umbrella of corporate performance of the organization. The main objective governance practices regarding the business of this study is to analyze the corporate governance operations, community, ethical and legal practices practices of firms from petroleum industry of with the focus on the investors’ rights protection. Pakistan. Examine their financial and social Over the last few decades, the overall growth of disclosure as to provide a link between their actual multinational giants and globalization has been practices and reportings in Pakistan using case study tremendous, which resulted in creating issues for method. growing public awareness. Many firms are playing 1.2 Current Environmental Social Responsibility: their role in the development of economy, but on the Corporate Social Disclosure has become an important other hand they are creating environmental issues and part of company’s reporting. It may be in the form of social problems that are harmful for the society and annual reports, reporting through stand-alone social reports, or environment sustainability reports etc.
1 | Social reporting can also be done via marketing The scholars today find a need to disclose social and activities like; advertising, product packaging, environmental impacts of operations of businesses conferences and company websites. “An organization that are harmful for the society. Some believe that by might voluntarily report information’s for many becoming accountable to the society organization reasons in order to develop corporate image, to will be having more goodwill and it helps in legitimize current activity, to distract attention from performing better. Other scholars are of the view that other areas, to discharge accountability, to forestall organization is only responsible to its shareholders, legislation”. Guthrie and Mathews[4] defines that it exist only to make money for its shareholders Corporate Social Disclosure (CSD) as, “The and not to invest them on the society [5] stipulation of financial and non financial information Gray [6], defined Corporate Social Reporting as, "The stated in the Company’s annual report or other social process of communicating the social and reports relating to interaction with its physical and environmental effects of organizations’ economic social environment.” The main objective of an actions to particular interest groups within society organization should not be restricted in creating and to society at large. Such an expansion is wealth for its shareholders’ but after the financial predicated upon the assumption that companies do crunch the organizations are moving towards a new have wider responsibilities than simply to making approach to disclose all their information to its money for their shareholders." This definition stakeholders in order to overcome information contradicts views of financial accounting which in asymmetries. the words of Laughlin and Gray can be divided and Figure 1: CSR reporting, reputation and legitimacy, J. limited to four areas: Bebbington, C. Larrinaga & J.M. Moneva (2007) 1: The financial description; The role of Corporate Social Disclosure for 2: Specified (priced) economic events; petroleum industry is very important as the refineries 3: Defined organizations or accounting entities; are responsible for the waste they emit in the sea is 4: Provide information for specified users of that very disastrous for the life under sea. It causes air information. pollutions also. The overall environmental effects for Corporate Social Disclosure is the extent of social the society, natural environment are very high related and environmental reporting in annual reports of the companies; this includes disclosure of financial profits along with environmental plus social impacts on the society. Major work on CSD has been done on developed countries but the paradigm is now shifting towards the developing countries. Where the concept of Corporate Social reporting is emerging and corporations in these countries are being required to report all their social and environmental actions. The study by Hossain M, Islam K & Andrew J[7] , on CSD activities of a developing country identified that a very few companies in Bangladesh are making efforts to provide social and environmental information on voluntary basis, which are mostly qualitative in to the petroleum companies who are specifically nature. Bangladesh companies are not much known associated with refinery businesses. for their social disclosure practices but for an emerging economy it creates a positive image among Literature Review: II. its stakeholders. The research also identified that the The twentieth century has brought a remarkable companies suffered losses who are not interested in change in the world which has developed building their social identity, during the period under significance of social and environmental issues. study and significant proportions of the ranking There has been an increase in economic activities, companies were subsidiaries of multinational technological development and growth in terms of companies or large corporations. On the other hand volume of business activities during this period. the companies in developed economies consider the Thus, these concurrently brought adverse effect on CSD reporting as an integrated part of their company the environment with social enclosure. The most reporting. prominent effects noticed is that it causes destruction Mia P & Abdullah- Al- Mamun 2011, have of ozone layer, social collapse, destruction of living researched on CSD activities of companies during the and non living beings, poverty and starvation etc financial crisis of 2008, which almost affected the (Gray and Bebbington 2001) entire world. The results of the study reveal that there
2 | is an insignificant upward change in CSD during the to human life. Mr. Hammad Naqi Khan, Director, financial crisis. In addition, the study examined the Freshwater and Toxics Program WWF Pakistan, association between several firm level factors signifies the growing awareness of CSR amongst (profitability, leverage, change in profitability, Corporations by awarding companies, they have change in leverage and size) and the extent of CSD launched Environmental Reporting Awards in and change in CSD. The study finds that the extent of collaboration with Ministry of Environment and CSD is not significantly associated with leverage and IUCN Pakistan in 2002 to appreciate the efforts who profitability but it is significantly associated with reports corporate environmental, social and size. Additionally, change in profitability and size do sustainability performance, he said that the awards not have any significant influence on change in CSD. ensure that companies target improvements in the However, change in leverage has a significant quality of information disclosed during the reporting negative association with change in CSD. process. Hence the awards help businesses streamline III. Environmental Social Responsibility sustainable practices and development. in Pakistan: IV. Petroleum Industry in Pakistan: The concept of Environmental Reporting is relatively Pakistan is a developing economy and for the new in Pakistan. CSD provides an opportunity for economic development it requires higher energy companies to inform its stakeholders about their consumption and consequently putting higher corporate efforts for ensuring operations and business pressure on country’s economy. A. Ahmad, M. Jha [8] that have minimal impact on the environment. Some states that, “being an emerging economy Pakistan companies view environmental reporting as an mostly rely on oil and gas resources to meet the impediment on their business; rather companies energy requirements of the country.” Currently there should view this as an opportunity to enhance their are a number of companies that are working upstream business while increasing confidence of its and downstream sectors with the help of National and stakeholders. Corporate Social Reporting is a big International organizations. They are actively challenge for a country like Pakistan, where the participating with Government of Pakistan in companies are mostly ruled by command and control establishing such policies that are favorable for systems. Institute of Chartered Accountant of investment and working for international investors. Pakistan (ICAP) has been working in this regard to Petroleum industry in Pakistan comprises of Attock provide regulatory framework that will not only focus Refinery, Burshane, Byco Petroleum, Attock on disciplinary actions but it will also provide petroleum, Mari Gas Company, National Refinery, corporate sector with an environment that enables Oil and Gas Development, Pak Oil fields, Pak greater compliance on social and ecological Petroleum, Pak Refinery, PSO and Shell listed on standards. Karachi Stock Exchange. There are other private ICAP has introduced IAS 19, which mainly deals companies that are also operating in Pakistan as with employee’s related benefits for short term petroleum exploration companies. The petroleum period, long term, termination and post employment sector contributes 6% in the overall economy of benefits. The benefits regarding salaries, wages, job Pakistan and it is growing at 10-12% per annum, it is securities, leaves and allowances, and different also estimated that during the FY 2012-13, major retirement benefits are given to employees according portion of non-tax revenue would be established from to their job status. As per ICAP disclosures about the petroleum sector amounting to Rs 147.878 billion employee’s safety and job security policies must (Daily Times–Budget Review, 2012). The oil and gas ensure public about ethical, legal and moral values of sector in Pakistan is mainly controlled by the state a corporation and also attracts foreign investments; through interventions in pricing, allocations, returns ultimately a positive effect is witnessed on firm’s and other administrative controls. Mostly Multi- financial performance. ICAP is the first institution national companies are involved in oil and gas that has launched the reporting requirements exploration business while state owned companies according to the international standards in order to are responsible for marketing and distribution of save interest of stakeholders and build the image of petroleum products e.g. PSO, Sui Northern Gas companies in a positive manner. Company and Sui Southern Gas Company. Likewise, Government of Pakistan has introduced Pakistan Pakistan Petroleum Ltd is the largest exploration and Environment Protection Act (PEPA) and National production company while the Attock Refinery Ltd. Environmental Quality Standards (NEQS) in 1997; and Pakistan Oilfields Ltd are two other state-owned which requires that companies to follow companies. The main objective of this study is to environmental regulations controlling population, analyze the corporate governance practices of firms agricultural wastages, social hazards or any damage from petroleum industry of Pakistan, examine their
3 | financial and social disclosure, as well as provide a Refinery Ltd., Pak Refinery and National Refinery. link between their actual practices and reportings in The petroleum Marketing and exploration companies Pakistan using case study method. could not become part of our sample size because In the light of above discussion this study provides a they are not in business of refining oil and petroleum link between theoretical perspective of Corporate products. The main aim of this study is to identify the Social Disclosure and Practices of Pakistani firms operational efficiency of refineries and how they focusing on oil, gas & refinery sector. Three dispose of waste so as to save environment and companies from Petroleum Industry have been society as a whole. selected for research paper as case studies to analyze Table 1: Outline of Sample Selection: the CSD by these companies. The petroleum industry 12 Petroleum Companies Listed on Karachi of Pakistan comprises of both public and private -2 Stock Exchange sector companies. We have selected only public 10 Petroleum Marketing & Distribution limited companies which are listed on Karachi Stock -7 Companies Exchange, because reports of these companies are 3 publicly available and there will be fewer hindrances Petroleum Exploration Companies for data collection. Specifically the companies under Comprise the Sample (Refineries) review are refineries from petroleum industry as they are mostly responsible for environmental problems. The data will be collected by primary and secondary In this regard, we will be using the six categories of sources. The secondary data will be collected from CSD proposed by Hackson and Milne (1996).i.e. annual reports, Karachi Stock Exchange (KSE), (1) environment; online publications, Companies Environment and (2) energy; sustainability reports, company’s official websites, (3) employees; research papers and books. For primary data (4) product; collection, personal interviews will be conducted in (5) community involvement; and which open ended questions will be used. The reason (6) others. for selecting this instrument is to get in depth The CSR reporting of the three selected companies information and knowledge as sometimes has been analyzed using the above six categories. unstructured questionnaires miss some significant V. Research Methodology: knowledge which may be gathered by structured The case study is qualitative in nature. Data will be questions. collected through open ended interviews, and the VI. Case Study I – Pakistan Refinery main aim of this study is to gather an in-depth Limited(PRL) understanding of the subject. The qualitative method 6.1 Background will help us to investigate the why and how of Pakistan Refinery Limited is a Pakistani Organization decision making, not just what, where, when. For this listed on Karachi Stock Exchange (KSE). The purpose the population of interest is the Petroleum company was incorporated in May 1960 as a public industry in Pakistan which includes the Companies limited company. It was established in alliance with listed by Karachi Stock Exchange and are public two major foreign oil companies namely Burmah Oil limited companies. The reason behind focusing on California, Texas Oil Corporation, Shell Petroleum this industry is that it has strong impacts on Corporation and Esso standard Eastern Inc. The environment and society. The population frame of refinery is located on the coastal belt of Karachi. PRL reference was constructed by taking all Petroleum has maintained its mission, vision and values of Companies namely; PSO, Shell, Attock Refinery, becoming first choice for all its stakeholders. PPL, Attock Petroleum Ltd, Burshane LPG, Byco 6.2 Environmental Social Responsibility practiced in Petroleum, Mari Gas Company, National Refinery, PRL Pak Oilfields, Pak Refinery and Oil & Gas The mission of PRL is to provide value added Development. products that are environmental friendly, and protect The sample size is then narrow down to the the interest of all its stakeholders in the market Refineries in Pakistan as listed in KSE and are public through sustainable development and quality human limited company. As public companies are required resources. PRL takes the responsibility of Health and to disclose their all actions while performing safety of its employees and it is explicitly mentioned operations. We will be using non-probability in their mission and sustainability reports. PRL has convenient sampling method for this research paper. an integrated Health, Safety, Environment and The sample size includes 3 Refineries from Quality Management system HSEQ based on ISO- petroleum industry of Pakistan; namely Attock 9001:2008, ISO-14001: 2004 and OHSAS-
4 | 18001:2007. HSEQ has been headed by the PRL has its own Ethics committee which keeps Managing Director and Chief Operating Officer, as configuration with environmental standard and the Dupont analysis suggested that a commitment for ethical business practices. The Committee is mainly Health, Safety and environment comes from the top responsible for ensuring that the Company’s of the organization. Maintaining the HSEQs is the operations are conducted in alignment with core responsibility of operations and supply organizational objectives and policies with high department. HSEQ ensures all systems are in place standards of values and ethical conduct. Ethics and that is required to mitigate and control any integrity are core values to the organization and it is undesirable hazardous situation (causing threat to embedded in its culture, employees at PRL are Health, Safety, Environment & Quality) arising in responsible to keep in place the ethics and integrity of case of any failure or accident in the refinery. the company. PRL has clearly defined its policies Pakistan Refinery Limited has adopted UN Global regarding harassment, acceptance of gifts; conflict of compact principles since 2007, under the principles interest etc. and there are no deviations accepted. stated in this document includes; Human Rights, Labor standards, environment and anti-corruption. 6.6 Health, Safety, Environment and Quality as The management of PRL is fully intact to claimed by PRL communicate these principles to all its employees and Pakistan Refinery Limited is committed to follow keep check on it so that they always remain in Health, Safety, Quality and Environmental Standards compliance with laws and the company maintains its HSEQ, for PRL health of its employees comes first to position strong towards the accomplishment of these everything because they believe that employees are goals. the main assets of the company and their health 6.3 Community Involvement: matters a lot. Safety could be maintained by Pakistan Refinery Limited feels the responsibility of preventing hazards by effective leadership and being a corporate citizen of this country it had been activities promoting high safety standards. actively participating to mitigate the effects of its Environmental standards are maintained at PRL by wrong decisions on the society it takes constructive progressive reduction of emission, effluent and interest in social and community matters which are disposal of waste material that are known to have a for the betterment of the society, it not only negative impact on the environment. The plant s undertakes the investment opportunities but also operating on specially designed waste water keeps in mind the community. PRL has taken many treatment, the effluents are processed in three stages initiatives and participated in community and then waste water is emitted in the sea water, they development, educational services, and medical are in line with National Environmental Quality services for the society. Standards specifications. PRL continues to report its 6.4 Major Social Interventions by PRL: emission and effluent test results with Sindh PRL has been actively participating in development Environment Protection Agency and Pakistan of community, by playing its role as a responsible Environment Protection Agency under self corporate citizen of Pakistan; it had won many monitoring and Reporting Tools (SMART) program. Awards on Social and community involvement and 6.7 Quality and continuous Improvements: working for safety of Environment. PRL alone PRL focuses on customer satisfaction by operating invested Rs. 11.8 Million in numerous meaningful efficiently and developing a culture which promotes programs for the community. PRL has established a innovation, error prevention and teamwork. As per Cardiology lab at Indus Hospital, Korangi. PRL ARL this is how a company becomes successful and continues to contribute in CSR activities; it had is able to maintain quality standards. PRL invested in a number of charitable projects such as representative states that, “ Quality and continuous Layton Rahmatullah Benevolent Trust and Indus improvements at PRL are assured by Audits, Test Hospital with an intention to facilitate the destitute run, Compliance and development of PRL’s own patients and The Citizen’s Foundation for educating HSEQ in compliance with ISO 14001.” PRL has the under-privileged children. PRL has won many achieved a three year recertification in November Awards or Token of appreciation from ACCA WWF 2011 on the ISO 9001:2008, ISO 14001:2004 and Environmental Reporting Awards, Annual OHSAS 18001:2007 standards respectively. Environment Excellence Award jointly organized by VII. Case Study II – National Refinery UN Environment Program, Occupational Health and Limited: (NRL) Safety (OHS) award and Occupational Health and 7.1 Background: Safety (OHS) award. National Refinery Limited is a public limited 6.5 Ethics and Integrity: company incorporated on August 1963; the company
5 | was taken over by Government under the National ISO 9001, Environment Management System ISO Reforms in 1972 and was working under the Ministry 14001, and for controlling Health and Safety risks of Production. In June 2003 NRL became part of effectively it has acquired ISO OHSAS 18001 Government Privatization Program and was acquired Certificate. The Company maintains an open by Attock Oil Group in 2005. Production facilities at environment for its employees to come up with new NRL are very high it produces and sale a wide range ideas and creative approaches so that it may advance of Petroleum products. There are three refineries technologically and produce the level of products that working under one complex, consisting of two lube are acceptable internationally. refineries and one fuel refinery. First lube refinery 7.4 Employees: has production capacity of 539,700 tons per annum At NRL, training is an important element for crude processing and 76,200 tons per annum of Lube enhancing the productivity and value of human Base Oils. The 2nd refinery has production capacity of resource. Employees are exposed regularly to training 100,000 tons per annum of Lube Bas Oils. The fuel programs, Workshops, seminars and professional refinery was established in 1977 and designed to courses both within the country and abroad. Training produce 1,500,800 tons per annum of crude Need Analysis (TNA) is carried out for employees at processing and after a revamp the capacity increased different levels of employees to assess their to 2,170,800 tons per annum of crude processing. In requirements covering both management and 1979 a BTX Petrochemical Plant was commissioned technical skills. Training program is developed for all with the production capacity of 25,000 TPA of BTX. employees. At the time of writing NRL is working to increase its NRL is firmly committed to the Health and Safety of refining capacity to improve yields of white oil its employees and to the protection / continuous products; ongoing projects include; Two Stage Unit improvement of the Environment. Training is at Lube-I Refinery, 101 Crude Distillation Unit at therefore imparted for Health, Safety, and Fuel Refinery and Refineries integrated projects. Environment & Quality to all including employees NRL is ISO 14001 Certified Company its operations and contractor. Safety of employees at NRL is are very harmful for the normal life but the confirmed by various measures taken by the company’s Environmental, Health, Safety and management of the company, it includes a series of Quality Standards are so much maintained that the activities; at NRL Korangi Fire drills are carried out operations are carried out smoothly without harming on every Thursday at 1000 hrs sharp, NRL Safety the environment. The company follows strictly the Board is updated by 2nd week of every month, every standards that are defined by the Company’s Code of month Newsletter is shared within and outside the Conduct and Ethics.They remain in line with it vision company which contains details regarding all of holding an attractive position among the corporate activities taking place within the NRL. success stories of tomorrow. 7.5 Community Involvement: 7.2 Health, Safety, Environmental Mission statement of NRL claims that it is the NRL is committed to provide better Health, Safety, responsibility of the company to serve the community Environment and Quality for all its internal and through a variety of socio-economic acts and external stakeholders. It has been working in maintaining a high level of safety, occupational compliance with the International and National health and environmental care. NRL has been Environment Laws, for carrying out the operations of actively participating in rehabilitation of refugees the business smoothly and environment friendly. from Swat and the near areas where army operation NRL has recently introduced 90RON which is was carried out because of terrorist activities in the unleaded motor gasoline, provides evidence in area. It had also actively participated in helping flood support of the company’s acts towards good affected people of interior areas of Sind. environment and its preservation. National Refinery 7.6 Honors Awarded to NRL for Environmental Limited has maintained HSEQ’s and NEQS to ensure Safety: compliance of International and National National Refinery Limited has been awarded many Environment Laws; it is firm belief of the Honors for its performance in maintaining the management that by following these standards the stability in its operations and keeping the company can make strategic decisions successfully Environment healthy. The Company has maintained and implement them without any resistance. AAA rating for Long term Debts and A1-plus rating 7.3 Quality: for short term debt by PACRA since 2005 to 2011, it National Refinery maintains strong position among has been awarded ISO OHSAS 18001:2007 its customers that the product leaving from NRL is of certificate since 2003 to 2011, Annual Environment high quality as the company has been awarded Excellence Award and ACCA WWF Pakistan various ISO certificates on; Certification on Quality Environmental Reporting Award.
6 | VIII. Case Study III - Attock Refinery conducive working environment and provide its Limited (ARL) resource with growth opportunities. 8.1 Background: 8.5 Major Interventions in Social Projects by ARL: With a vision to acquire self sufficiency in petroleum Attock Sahara Foundation (ASF), a company industry of Pakistan Attock refinery was incorporated sponsored NGO is working to uplift economic as a Private Limited Company in November 1978, in conditions of the surrounding communities through June 1979 it was listed on all 3 stock exchanges of welfare services. ARL has been actively participating Pakistan as a public limited company and it is the in expanding education in Pakistan it had organized first company listed on Central Depository Company Third HR Conference in October 2011, on Expanding of Pakistan CDC. Attock refinery limited is in a HR Horizon, it also offers allowance for education of business of refining crude oil. The production under privileged classes, and scholarships for brilliant capacity at ARL includes 42,000 bpd and it possesses students as well. Women health awareness session the capability to process lightest to heaviest crude oil. and clean water for the community are also among In the words of CEO Attock Refinery, “Our the most prominent community involvement sustainability attributes are based on five pillars of activities of ARL. strength i.e. Diversification, Competitiveness, IX. Discussion: Transparency/ Compliance, Synchronized This study sheds light on corporate environmental Community and Social Responsibility Services, and practices of the leading companies from petroleum Environmental Protection.” The Company is ISO industry of Pakistan. After the three case studies it 9001, ISO 14001, ISO/IEC 17025 and OHSAS 18001 can be concluded that today’s organizations are more certified. At the time of writing ARL is in a process socially active and heavily involved in bringing to increase capacity of its White oil pipeline project, welfare for the community, by introducing processes storage capacity and Dissolved Air Floatation Unit that are environment friendly and promoting (DAF). activities that are solely for the welfare of the 8.2 Health, Safety and Environment: community. This study provides evidence that the ARL has a central HSE committee which involves argument of traditional finance theory that the sole the contribution of management and workers purpose of an organization is profit maximization of together; in the last five years the number of its shareholders is changed and today’s managers are accidents range from 15 to 2.5 whixg clearly shows more participating in the development of society and the improvement of safety standards at ARL. Attock community around them. Refinery Limited follows strict HSEQ policy. It is The organizations today are more interested in committed to provide best quality products to its developing their employee’s commitment by customers, to protect the environment and to ensure providing them with better career growth, training the safety of its employees, customers and partners. and development, educational scholarships and 8.3 Community Involvement: performance appraisals which motivate them to work Participation in area union council meetings provides for their organization with full efficiency and ARL a chance to come closer to the community delegation. Employees safety measures taken by where they are operating and give back to community refineries are highly effective as in 2011 in ARL something. Communication of ARL commitment and achieved 9.11 million Safe man hours, whereas NRL social program to community by displaying large has achieved 16.99 million safe man hours, this number of colorful banners with thought provoking shows how effective are the HSEQ policies of these statements were displayed at prominent locations. In companies are. The petroleum companies in Pakistan collaboration with Attock Hospital the company are now technologically so advanced that they have organizes free medical camp for the locals to refrain deployed highly technical machinery in their plants to them from diseases. mitigate the effects of effluents and emission that are 8.4 Human Resource: harmful for air and water. The technology used can ARL’s corporate strategy for Human Resource is to now reduce the harmfulness of waste that is disposed attain high level of professionalism, throughout the off in water and does not harm the life below sea and organization by recognizing and revealing the people living nearby the refineries. personal and professional capabilities of the human These companies are working hard to build trust, resource and enhancing their contribution to the integrity and confidence in the society as believe they development of the organization. ARL employees the are responsible for giving back to society whatever best qualified personnel, pay just and responsible they have achieved. Despite the fact that there are no compensation, employees are motivated to attain strict government rules and regulations to follow their maximum efficiency and capabilities, produce CSR but the companies are on voluntary basis
7 | promoting Disclosure policy. As today’s investors [5] Gray, R, Owen D and Maunders K 1987, and stakeholders are more aware about the business Corporate Social Reporting: Accounting and processes and they want to show positive image to Accountability, Prentice-Hall, London. society that they are environment friendly. The above [6] Guthrie J and Mathews MR 1985, “Corporate case study shows detail actions of the companies Social Accounting in Australasia", in Preston, L.E. regarding their CSD activities, although the industry (Ed.), Research in Corporate Social Performance and under review produce products that are harmful for Policy, Vol. 7, pp. 251-77. the environment and society but the actions of the [7] Hossain M, Islam K & Andrew J 2006, companies reflects that how much they are trying and Corporate Social and Environmental Disclosure in working on to mitigate the effects of their work on Developing Countries: Evidence from Bangladesh, society by investing in hospitals, community Faculty of Commerce, University of Wollongong services, educational programs etc. Research Online X. Conclusion: [8] Ahmed A, Jha MK 2008, Status Of Petroleum This study shed light on the importance of disclosing Sector In Pakistan - A Review, Asian Institute of environmental information other than financial Technology, Bangkok, Thailand information to all stakeholders of an organization. “CSR Pakistan”,
I. References: [1] Mitra, S, Dhar S and Agarwal KM 2008, Assessment of Corporate Environmental Pro- activeness, South Asian Journal of Management, Vol.15, No. 3, pp. 99-135. [2] Wise, Victoria and Ali MM, 2008, Case studies on corporate governance and corporate social responsibility, South Asian journal of management, vol. 15, no. 3, pp. 136-149. [3] Ali, I., Rehman, K., Ali, S. I., Yousaf, J. and Zia, M., 2010, “Corporate social responsibility influences, employee commitment and organizational performance”, African Journal of Business Management, vol. 4(12), pp. 2796-2801. [4] J.Bebbington J, Larrinaga C & Moneva JM 2007, Corporate social reporting and reputation risk II. Appendix: management, Emerald Insight
8 | Corporate Social Disclosure: A Case Study on consistent with the requirements of the social, economic and political environment Petroleum Industry of Pakistan of Pakistan?
Questionnaire 9. How do you define economic, legal, ethical 1. What is your company’s Corporate Social and philanthropic responsibility? What are Disclosure policy? your economical, legal, ethical and philanthropic responsibilities? Is your 2. Is CSD a separate division in your business company being CSD responsive? If yes, in or is it integrated throughout the whole what ways? organization? Why?
3. What are the main benefits with having a 10. Why and how is social accounting being good CSD approach? What benefits are undertaken in large commercial more and less important? Why? organizations example in Petroleum Industry of Pakistan particularly with respect to an 4. What are the motives for having a CSD emerging economy? approach? (e.g. enhanced reputation/image, sustainable development?) What are the 11. What is your company’s perception about effects on your company’s image and the phenomena of CSD in an emerging reputation lacking a CSD approach? economy like Pakistan?
12. As compared to the companies in developed 5. What type of information do you think economies why companies in emerging should be disclosed? How do this economies disclose very little or nothing on information should be disclosed and where social, ethical and environmental issues? should it be published? 13. In your opinion what are the factors that 6. Are there any guidelines/regulations shape or constrain the emergence of CSD in governing the Corporate Social Disclosure Pakistan? by the accounting professional bodies and /or by the government? Please discuss some 14. What are the challenges for your company of them. when it comes to CSD? How does your company cope with these challenges? 7. Are there any environmental regulations that need to be followed by the petroleum companies? If there are any how you perceive it?
8. Do you believe that the current corporate reporting practices of your company are
9 |