The Cost of Honesty: Does CSR Expenditure Signal Corruption Transparency in the Financial Firms?

Dewi Mustika Ratu (Department of Accounting, Faculty of Economics and Business, Diponegoro University, Indonesia)

Journal of Accounting and Finance Management (JAFM)
Vol. 7 No. 2 (2026): Journal of Accounting and Finance Management (May - June 2026)

This study investigates the relationship between CSR spending and anti-corruption disclosure. Through the lens of impression management, higher CSR expenditure encourages firms to seek more disclosures, especially regarding anti-corruption, as a strategy to build a positive impression among stakeholders. This research employs a sample of financial firms listed in the Indonesia Stock Exchange (IDX) during 2021-2024, with 200 firm-year observations. Data were collected from the annual and sustainability reports through archival research. As expected, there is a positive relationship between CSR spending and anti-corruption disclosure. Higher CSR spending motivates firms to reveal anti-corruption activities to establish a good reputation. Besides being a regulatory requirement, anti-corruption disclosures also serve as a strategic action in impression management. Consequently, regulators need to go beyond CSR spending regulations to determine whether companies’ disclosures reflect genuine ethical commitments or serve as symbolic gestures.