University of Vaasa - Vaasan yliopisto

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An institution is the natural product of some determined social pressure and needing,
the organization adapts itself to its own function rule and external demand (Selznick
1996). The firm, as an institution, should contribute to sustainable development; this
concept includes, among others, corporate policies, different codes of conduct,
support for humanitarian causes, ethics in business, environmental impact and
improving the living conditions of the various stakeholders forming the community
where the company carries out its activities (AECA 2004). Social support is essential
and to get it companies should be transparent in their management (Gray et al. 2005).
From the institutional perspective, performance can be viewed as institutionally
defined as institutional factors determine the interest being pursued by organizations
(Scott 1987).
Literature shows that adopting corporate principles such as transparency in business
and taking into account the interests of different stakeholders in the organization's
culture is positive for the company's efficiency (Freeman et al. 2004). Reporting is
the main tool that can be used as the basis for managing relationships with
stakeholders in order to obtain their support and approval (Bebbington et al. 2001).
According to the institutional theory, some sectors contain agents with enough
power to impose structures or practices on subordinate organisational units
(Mostaque et al. 2002). Changes in information are normally adopted by older, larger
organisations, as they can reach a point where, rather than adapt to the surroundings,
they dominate them (Freeman 1992). The performance of these large companies that
are leaders in their sector causes a process of constraint over the community they are
involved in, forcing other companies in the sector to become like them, as they face
the same environmental conditions (DiMaggio et al. 1991). Thus, organisations
gradually alter their behaviour to increase their compatibility with the characteristics
of the environment, competing for resources, also to gain political power and
institutional legitimacy in order to achieve financial and social objectives (Aldrich
1979; DiMaggio et al. 1983). On having to provide information when the standard
defined or demanded by the public is still not very clear (Gray 2005), it is the agents
themselves who are carrying out the institutional isomorphic change. Institutional
pressure impels organisations to change, tending to follow the standards and
behaviour of the leading organisations (DiMaggio et al. 1983; DiMaggio et al. 1991),
achieving results that are reasonably viable with little effort (Cyert et al. 1963;
DiMaggio et al. 1991).
From the institutional perspective, one consequence of institutional isomorphism is
that organization needs to be accepted by its external environment (DiMaggio et al.
1983; Deephouse 1996).
Certain sectors of business have constituted themselves as the champions of
management aimed at protecting the environment to the full, as a consequence of
factors concerning the responsibility of the company arising from its activities
(Bebbington et al. 2007; Snider et al. 2003 ). In addition to the impacts caused by
specific activities, other factors are also involved in the presentation of data on
environmental and social performance, such as belonging to a regulated sector
(Hohmeyer 1988; Llena et al. 2007). The annual information provided by the
company has been increasing in volume now that there are separate special reports
on ethical and ecological issues aimed at agents other than the traditional ones (Gray
et al. 1996; Moneva et al. 2001).