From May 10,2005, the Partners for Financial Stability (PFS) Program publishes its fourth semi-annual Survey of Reporting on Corporate Social Responsibility (CSR) by the 10 Largest Listed Companies (by market capitalization) in eleven Central and Eastern European (CEE) countries. Companies in Czech Republic, Estonia, Latvia, Lithuania, Slovakia and Slovenia were surveyed for the fourth time; companies in Hungary and Poland were surveyed for the third time; and companies in Bulgaria, Croatia and Romania were surveyed for the second time.
The survey was conducted by PFS Program interns Szymon Gawel, Monika Sowinska and Dominika Sipowicz.
The survey analyzes companies disclosures in English on the English-language company website and in the English-language annual report during April 2005. It documents a generally similar level of disclosure on company websites to that observed in August 2004 across all three information categories analyzed – corporate governance, environmental policy and social policy. However, in certain countries, availability of English-language websites has increased. Also, corporate governance codes significantly impact reporting on corporate governance issues in certain countries.
In Latvia, Lithuania and Slovenia all 10 of the companies surveyed have an English-language website; however, companies in Latvia and Lithuania generally did not disclose information on all three categories surveyed. In Hungary, nine of the 10 companies have an English-language website. In general, companies in Hungary, Poland and Slovenia disclosed the most information online. The level of disclosure decreased in Bulgaria and Romania, perhaps due to the fact that due to changes in market capitalization the universe of companies surveyed changed significantly. Approximately half of the companies in each country were surveyed for the first time. By contrast, the level of disclosure improved in Croatia.
Survey findings include the following:
83% of the companies surveyed have an English language website (compared with 86% in August 2004 and 85% in April 2003);
71% of the companies surveyed disclose information about their governance structure on their websites (compared with 69% in August 2004 and 50% in April 2004);
41% of the companies surveyed mention compliance with environmental standards on their websites (compared with 37% in August 2004 and 28% in April 2004);
37% of the companies surveyed disclose information about sponsorships on their websites (compared with 28% in August 2004 and 31% in April 2004); and
20% of the companies surveyed note compliance with a corporate governance code on their websites (whereas in August 2004 the percentage was 7%).
Comparisons with disclosure in annual reports is not as relevant in this survey, since as of April 15, 2005 many companies have not yet published their 2004 annual report online. However, it should be noted that Estonia is the clear exception in the region. By April 15, 2005 each of the 10 Estonian companies surveyed had published an English-language version of their annual report online. However, it should be noted that in many cases the annual report is only available on the website of the Tallinn Stock Exchange. Nevertheless, in each of the four surveys to date, all 10 Estonian companies provided electronic versions of their annual report online. This was not the case in any of the other 10 countries.
The fifth survey, to be published in August 2005, will compare disclosure in annual reports with disclosures made in August 2004. It will also continue to track trends in reporting on company websites.
Starting today, the survey is available online at: http://www.pfsprogram.org/capitalmarke ts_research.php
About the Partners for Financial Stability (PFS) Program
The Partners for Financial Stability (PFS) Program, established in December 1999, is a cooperative program of the United States Agency for International Development (USAID) and several other institutions, including East-West Management Institute (EWMI), a New York-based non-profit organization. EWMI implements the regional component of the PFS Program.
From late 1999 until April 2004, the PFS Program was active in five Central and Eastern European (CEE) countries that joined the European Union (EU) on May 1, 2004: Czech Republic, Hungary, Poland, Slovak Republic and Slovenia. Under a grant from the United States Department of State, the PFS Program remained active in Estonia, Latvia and Lithuania until March 31, 2005. USAID is currently assessing the potential expansion of the PFS Program to several Southeastern European (SEE) countries.
The PFS Program is mandated to fill remaining gaps in the institutional development of the financial sector through regional integration and cooperation, selective technical assistance programs and the practical application of lessons learned in neighboring countries. The substantive areas covered under the PFS Program are: accounting, auditing, banking, capital markets, insurance and pension reform.