Corporate Social Reporting: a Comprehensive Picture of Indonesian Mining Companies

Recently, stakeholders demand that CSR reporting of a company provides social and environmental information as well as the financial information reported in financial statement. This research questioned whether CSR reporting of Indonesian mining companies may be regarded as a mechanism which social and environmental accountability are discharged. The purpose of this research is to provide a content analysis framework and information on the comprehensiveness of Corporate Social Responsibility (CSR) reporting of Indonesian mining companies. The methodology used is content analysis method by a framework derived from GRI G3.1 Guidelines. Comprehensive reporting contains three types of information for each disclosed CSR item: (i) vision and goals, (ii) management approach, and (iii) performance indicator. The framework was used to assess the comprehensiveness of CSR report by analyzing the 2012 financial reports and annual reports of Indonesian listed mining companies. The content analysis of CSR reporting of the listed mining companies in Indonesia shows a low level of comprehensive reporting. This finding agrees those of prior studies on the completeness of CSR reporting and adds to the debate regarding whether CSR reporting of Indonesian mining companies can be considered a mechanism for discharging social and environmental accountability.


INTRODUCTION
Corporate Social Responsibility (CSR) is a concept that has changed worldwide perspective that the aspect of social and environmental accountability also provides information regarding the values, objectives and quantified targets of a company. The concept of CSR is relatively new among the companies in Indonesia. CSR report provides significant information to the stakeholders to make a decision as well as the financial information reported in financial statement. However, the previous studies have revealed that it is highly doubtful that current CSR reporting provides a fair view of a company's CSR performance to the stakeholders. This doubt mainly originates from the fact that the companies predominantly provide narrative CSR information, which usually was tailored to manage public impression (Adams, et al., 1995). Comprehensive reporting requires three information types to be provided for each disclosed CSR item: (i) vision and goals (VG); (ii) management approach (MA); and performance indicator (PI) (Bouten et al., 2011). Comprehensive reporting is a condition that needs to be fulfilled to obtain accountability (Adams, 2004). The comprehensiveness of CSR reporting can be captured not only by (i) the disclosed CSR items but also (ii) the accompanying information types (VG, MA, and PI) (Bouten, et al., 2011).
To assess the framework and obtain the information on the comprehensiveness of CSR reporting is conducted by analyzing and 2012 annual reports of 31 Indonesian listed mining companies. The main reason for choosing the sample is, to our knowledge, there are still few literature and studies regarding CSR in Indonesia and mainly focused on larger companies (Crane, et al., 2008). Then, we selected 2012 annual reports for analysis because these reports were the most recently available data in Indonesia.

Theoretical Framework
Responsibility reporting is a part of a firm's communication tools in order to decrease information asymmetry between managers and investors and in order to produce a more precise market valuation of a firm (Niskala & Schadewitz, 2010). For the firm the environmental information that's given to stakeholder is attempt to communicate the performance of management in achieving long-run corporate benefits, such as improved financial performance, increased competitive advantage, profit maximization, and the long-term success of the firm (Nigel et al. 2005). Size and industry membership affect the amount of CSR disclosure, disclosures of all CSR issues are affected by their visibility, shareholder structure, and relationship with their US stakeholders (Gamerschlag, Moeller, & Verbeeten, 2010).
The Sarbanes-Oxley Act of 2002 (the Act) was reinforcing corporate accountability and professional responsibility in order to restore investor confidence in corporate America (Rezaee & Jain, 2005). Much research question is whether current reporting practices truly reflect corporate social and environmental behavior (Unerman, 2000). Underlying dilemmas and complexities for managers in dealing with accountability to shareholders and stakeholders, and the role of auditors, are indicated. As those, reports should provide objective information that allows stakeholders to make a reliable estimate of the organization's social and environmental performance (Gray, 2006).
To further the correspondence between reporting and actual performance, several prior studies have suggested a form of CSR reporting, which we will call comprehensive reporting. According to Robertson and Nicholson (1996), the 'ideal model' of CSR disclosure combines three hierarchical disclosure levels to close the gap between rhetoric and action. These disclosure levels are (i) 'General Rhetoric', which covers the corporate recognition of the value of CSR; (ii) 'Specific Endeavour', which consists of CSR activities and (iii) 'Implementation and Monitoring' of CSR programs. Companies that publicly set targets and report on their progress made have reached this level. Adams (2004) argues that one condition for the discharging of accountability is that companies provide clear statements of values, objectives and targets against which they report. Overall, prior studies suggest that CSR reporting should not only provide statements of commitments but should also elaborate on the fulfillment of these commitments and the achieved outcomes. Such reporting furthers the discharging of social and environmental accountability because it enables stakeholders to gain an overall understanding of a company's social and environmental performance.
Because CSR reporting is considered an important mechanism through which companies can account for their social and environmental policies and performance to a variety of stakeholders, many empirical research studies have analyzed the content of corporate reports for disclosures with respect to one or more categories of social and environmental matters (Unerman, 2000). According to Beck, Campbell, and Shrives (2010), these studies could be used to assess the completeness of reporting, i.e., the number of items disclosed. However, in order to serve as a valuable tool for assessing the level of accountability, a content analysis must also capture the information types provided. Guthrie, Cuganesan, Ward (2008) have argued that a sense of quality can be gained from whether the statement about an item is declarative, monetary quantitative or non-monetary quantitative. Overall, these studies reveal a distinct lack of specificity in the disclosed information, indicating that CSR reporting is typically vague. Nevertheless, based on these studies, it remains impossible to judge whether companies mainly elaborate on aims and intentions or on real actions taken.

RESEARCH METHOD
This study uses a study conducted by Bouten (Bouten et al., 2011) as a reference, so that the stages of the following research methods derived from the study of Bouten. In addition to explaining the developed content analysis framework, this paper aims to illustrate the application of the framework by analyzing the disclosures of Indonesian listed mining companies. Each company's 2012 financial reports and annual reports were used as the basis of analysis because; the financial report and annual report play an important role in the accountability-discharge activity of companies. The reasons are because they are widely distributed and usually available on the company's website and because they are considered as the most important tools used by companies to communicate with their stakeholders (Neu et al., 1998).
In year 2012 the Indonesian government issued a decree No.47 Year 2012 on Environmental and Social Responsibility (CSR), which expressly stated therein liability of any kind of company to include CSR reporting in the statement of the General Meeting of Shareholders of each. We focused on publicly traded mining companies, as they are more likely to disclose CSR information (Branco & Rodrigues, 2008). There are 31 listed companies and we take 13 as the sample. The publicly traded mining companies were attributed to industry's sub sectors according to Profile of Listed Companies in Indonesia Stock Exchange website. The list of the sample is below. To assess the level of comprehensive reporting, a content analysis framework was developed. Content analysis can be defined as a method of codifying text into different groups depending on selected criteria (Weber, 1990). This method has been frequently used to understand and describe the patterns in CSR reporting (Guthrie &Abeysekera, 2006).
As illustrated in Figure 1 The Coding Structure (see Appendix), the coding structure consists of two dimensions: (i) content and (ii) information types. The first dimension consists of two levels: (i) areas and (ii) items. The coding structure has the form of a coding tree. The coder first decides on the area of disclosure, then on the item of disclosure and finally on the information type. Following Krippendorff (2004), a coding structure in the form of a decision tree has the following advantages: (i) criteria confusion is minimized, (ii) decision schemes can drastically reduce large numbers of alternatives, (iii) decision schemes can prevent unreliability due to categories being defined on different levels of generality or that overlap in meaning and (iv) when recording involves several dimensions of judgment, decision schemes offer coders the opportunity to determine each one separately.
Although no consensus exists on what CSR reporting means (Guthrie, et al., 2008), appropriate content analysis demands that the coding structure is derived from shared meanings (Beattie & Thomson, 2007). Therefore, the Global Reporting Initiative's (GRI) Sustainability Reporting Guidelines (version 3.1) served as an appropriate starting point for the development of the coding structure because the GRI framework is global, has international acceptance (Farneti & Guthrie, 2009), is considered a rigorous framework for the application of triple bottom line reporting (Lamberton, 2005) and was drafted by a wide variety of experts after stakeholder consultation (Reynolds &Yuthas, 2008).
Furthermore, the GRI guidelines are readily available on the GRI's website. These guidelines are intended for all types of companies, allowing for the derived coding structure to be used for different industries (Willis, 2003). Although the GRI has developed sector supplements for a few industries, the GRI still considers these guidelines to be the cornerstone of the GRI Sustainability Reporting Structure. These guidelines outline the core content for reporting and are relevant to all organizations, regardless of their size, sector or location. They form the foundation upon which all other GRI reporting guidance is based (www.globalreporting.org).
Finally, the GRI guidelines provide a structured overview of the base content of CSR reporting. The base content is divided into six areas (economic, environment, human rights, labor practices and decent work, product responsibility, and society) and several items (see Figure 2 The GRI G3.1 as Reference for the Dimension Content in appendix). This approach adds directly to the transparency and replicability of the content analysis because other researchers can also use these guidelines to determine which area and item a disclosure belongs to.
The GRI suggests that a company should provide different information types (strategy and profile, management approach and performance indicators) when it discloses a CSR item. However, these categories are not clearly defined. Therefore, the second dimension distinguishes between three information types, based on the work of Vuontisjärvi (2006). Vuontisjärvi (2006), this category includes disclosures that provide information on stated aims or values. This category thus covers corporate recognition of the values of CSR (e.g., striving for a reduction in energy consumption. Management approach (MA), similar to Vuontisjärvi (2006), this category covers how the company addresses a given CSR issue by describing the action or practice adopted, and it corresponds to the second level, 'Specific Endeavour', of Robertson and Nicholson's (1996) hierarchy. Performance indicators (PI), similar to Vuontisjärvi (2006), this category reflects actual CSR achievements by providing quantitative measures of CSR performance.

Vision and goals (VG), in line with
This study adds a table for content analysis framework that is not contained in the article Bouten, which is in appendix Table 2 The GRI G3.1 as Reference for the Dimension Information Types. The addition is intended to simplify the process of coding. Identifying and Quantifying CSR Disclosures; before verifying the presence of an item and the disclosure type, it was necessary to read each report to identify and code every sentence that contained CSR information by assigning a content and information type label to it. In line with most social and environmental content analyses, the sentence was thus used as the unit of analysis (Guthrie, et al., 2008). Level of Comprehensive CSR Reporting; the main contribution of the content analysis framework is that it assesses the comprehensiveness of CSR reporting by verifying whether a company releases information on VG, MA and PI concerning a specific CSR item. Based on this information, a measure for the level of comprehensive CSR reporting can be constructed as follows: The level of comprehensive reporting reveals the extent to which a company discloses all three information types for the items they report on.

RESULTS AND DISCUSSION
This section describes the results of the application of the content analysis to the 2012 financial reports and annual reports of 13 Indonesian listed mining firms and illustrates the feasibility of the developed framework to answer a variety of research questions. Panel A of Table 3 Main Characteristics of CSR Reporting in Indonesia illustrates that the all of the 13Indonesian listed mining companies (100.0%) elaborate on at least one item in the economic area. Furthermore, more than half of the companies (53.8%) provide some environmental and labor information. Slightly more than onethird of companies (38.5%) disclose some society and human rights information. Slightly less than one-third of companies (30.8%) disclose some product responsibility information. These findings confirm that Indonesian mining companies tend to focus on the economic aspect of CSR. Overall, 13 companies (100.0%) disclose some information on at least one CSR item. Because the focus of this section is on assessing the level of comprehensive CSR reporting, which is the main contribution of the content analysis framework, the remainder of the results section will focus on the 13 disclosing companies. The last column in Panel B of Table 3 shows that, in total, 163 items are disclosed by the 13 reporting companies. Furthermore, Panel B illustrates that only 8.0% of all items are covered by a MA disclosure, while 65.0% of all items are covered by a VG disclosure. About 33.1% of the items is a PI provided. Table 4 Overview of the level of comprehensive reporting (a) and level of cooccurrence of the qualitative information types (b) illustrates that, for almost all of the disclosing companies (92.3%), the level of comprehensive reporting is zero because they fail to provide all three information types for at least one reported item. For only one company, the level of comprehensive reporting is greater than zero but smaller than or equal to 0.1. Column b in Table 4 Overview of the level of comprehensive reporting (a) and level of co-occurrence of the qualitative information types (b) describes the level of co-occurrence of the narrative categories -VG and MA. Even so, more than 80% of the reporting companies fail to provide both information types for at least one of their disclosed items. For only 2 companies, the level of co-occurrence is greater than zero but smaller than 0.1. The findings raise the question: Do the isolated disclosures inform the stakeholders on aims and intentions or on specific actions?

Column a in
In total, 163 separate CSR items are disclosed by the 13 disclosing companies. Table 5 Overview of the information types and their combinations in total and per area shows the information types in which these items are covered. As such, Table 5 Overview of the information types and their combinations in total and per area answers the second question by illustrating that isolated disclosures mostly inform the stakeholders on specific actions because 5.5% of the total number of items disclosed by all reporting companies are only covered by a MA disclosure; 'isolated' VG disclosures occur more than ten times as often (60.1%). By illustrating that the frequency of the information types and their combinations are different, Table 5 Overview of the information types and their combinations in total and per area shows that the level of comprehensive reporting is very low. More specifically, only in the area of economic is one (3.8%) of the disclosed items covered by all three information types.
To reveal whether the preferred information types differ between the items, Table 6 Overview of information types and their combinations per item reports (i) the number of companies that report on a certain item and (ii) how these companies disclose that item, i.e., by providing all three information types, two information types, or only one information type. Table 6 Overview of information types and their combinations per item confirms that economic performance item is typically only covered by PI disclosures (69.2%). Nearly all environmental items are mostly covered only by VG disclosures. Most disclosing companies provide only VG disclosures regarding the items about labor practices and decent work performance. None of the companies reveal all three information types on one or more items in the areas of human rights, product responsibility and society. Most companies report only VG information on the human rights, society and product responsibility items they disclose.

CONCLUSION
Although the content analysis framework developed through this research can be used to assess the completeness and comprehensiveness of reporting CSR and various other research questions, it is necessary to discuss the limitations that may provide opportunities for future research. First, this study did not evaluate the overall quality of disclosures, nor did it determine the credibility of disclosures. Thus, this study focused only on the two terms of accountability, i.e., completeness and comprehensiveness. This focus means that even though the company reported all three types of information, disclosure can still be chosen to reflect on the good things the company concerned.
Future research could be conducted to determine whether there is a relationship between a comprehensive reporting and CSR performance. Second, in this study, a number of items is used to obtain an indication of CSR disclosure completeness. But, CSR items included in the analysis cannot be considered a complete list of items that must be reported by the company. Instead, it is a list of CSR items, which -according to the GRI Guidelines -contains items that can be disclosed by each company. Some items that may be relevant to a particular company may not be listed in the proposed disclosure. Completeness of reporting can only be assessed by considering the supporting evidence of user information. By using survey research in detail and in-depth interviews, future research may (i) examine the demanded detailed information from various stakeholders and (ii) study the extent to which these stakeholders feel their information needs are met.  Water sources significantly affected by withdrawal of water. EN 10 Percentage and total volume of water recycled and reused. Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas. EN 12

APPENDIX
Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas. MM 1 Amount of land (owned or leased, and managed for production activities or extractive use) disturbed or rehabilitated.

EN 13
Habitats protected or restored. EN 14 Strategies, current actions, and future plans for managing impacts on biodiversity. OG 4 Number and percentage of significant operating sites in which biodiversity risk has been assessed and monitored. MM 2 The number and percentage of total sites identified as requiring biodiversity management plans according to stated criteria, and the number (  Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings. LA 12 Percentage of employees receiving regular performance and career development reviews, by gender. Operations and significant suppliers identified as having significant risk for incidents of child labor, and measures taken to contribute to the effective abolition of child labor.  The extent to which grievance mechanisms were used to resolved disputes relating to land use, customary rights of local communities and Indigenous Peoples, and the outcomes. MM 8 Number (and percentage) of company operating sites where artisanal and small-scale mining (ASM) takes place on, or adjacent to, the site; the associated risks and the actions taken to manage and mitigate these risks. MM 9 Sites where resettlements took place, the number of households resettled in each, and how their livelihoods were affected in the process.

MM 10
Number and percentage of operations with closure plans. SO 9 Operations with significant potential or actual negative impacts on local communities.

SO 10
Prevention and mitigation measures implemented in operations with significant potential or actual negative impacts on local communities. OG 10 Number and description of significant disputes with local communities and indigenous peoples. OG 11 Number of sites that have been decommissioned and sites that are in the process of being decommissioned. Operations where involuntary resettlement took place, the number of households resettled in each and how their livelihoods were affected in the process. OG 13 Number of process safety events, by business activity.