The influence of stakeholder identification on the quality of corporate environmental reporting in Kenya
Abstract
This study aimed at establishing the stakeholders that managers consider in the CER practices as well as the
association between the quality of CER and stakeholder identification. The purpose is to find out if there is a
difference in the attention that managers give to different stakeholders with respect to CER reporting
decision and whether such difference may explain the variation in the quality of CER. A questionnaire was
used to establish the stakeholder power, legitimacy urgency and salience in stakeholder identification. An
assessment, using regression, was carried out to establish the association between the stakeholder
identification attributes and the quality of CER. It is found that there are different stakeholders considered in
the practice of CER but in varying measures. While Government, Shareholders, Customers and
Environmental lobby groups are identified as the most significant stakeholder groups in CER reporting, only
government is associated with relatively higher quality. There is thus a need for the government to use its
special position in society to influence the production of CER that can achieve high quality. But there is also
a need for other stakeholder groups to recognise their special place in demanding high quality CER through
direct influence in terms of controlling flow of resources and markets to corporation but also petitioning
government to continue playing its social role of guiding production of high quality CER. This research
contributes to knowledge by establishing the significant stakeholders, the association of stakeholder
identification to the quality of CER and by testing applicability of stakeholder theory in CER practices.