43 ISSN 1822 – 7260 SOCIAL SCIENCE. 2013. Nr. 3 (81) Customer Value Creation through Corporate Disclosure on Society-oriented Activities. Do CEO’s Characteristics Influence the Scope of Disclosure? Halina Waniak-Michalak and Jan Michalak University of Lodz, Faculty of Management, Department of Accounting J. Matejki str. 22/24, 90-237 Łódź, Poland http://dx.doi.org/10.5755/j01.ss.81.3.5797 Abstract Customer value creation (CVC) in contemporary companies is a complex process. It embraces customer service, physical evidence, and image associated with the company. The image of a company is now partially created by corporate society-oriented activities. The process of CVC and corporate social responsibility (CSR) fulfillment is conducted by a wide range of company employees. The aim of the paper is to answer the question whether management board characteristics influence the scope of CSR reporting, as a tool of the customer value creation process. In the current research, the authors examine CSR reports and websites of 20 companies in Poland, using two research methods, content analysis and hierarchical cluster analysis, and measuring the level of disclosure on the websites and CSR reports with the index of disclosure. The research reveals that the level of CSR disclosure depends on the characteristics of management boards (age and experience of a chairman/-person). At the same time, few companies disclose information about the impact of CSR activities on customer value creation. Keywords: CSR reports, voluntary disclosure, charitable, tone at the top, CEO. Abbreviations: CSR- Corporate Social Responsibility; CVC - Customer Value Creation; CEO - Chair Executive Officer; NGO - Non-Governmental Organization; CECP - Committee Encouraging Corporate Philanthropy; GRI - Global Reporting Initiative; CEPS - Confederation Europeenne des Producteurs de Spiritueux; PGNiG - Polskie Górnictwo Naftowe i Gazownictwo; CBOS - Centrum Badań Opinii Społecznej . Introduction The importance of corporate social responsibility in business increases and becomes a topic of interest for many researchers (Austin, 2000; Campbell, 2007; Jamali and Keshishian, 2009). Globalization, the growth in the scale of the environmental and human life impact of business (as well as the knowledge on the subject) have induced corporations to conduct socially responsible activities, embracing environmental protection, aid to the poor, children, and others in need. Moreover, corporation executives are convinced themselves that society expects business to take an active role in social life (CECP, 2008). The awareness of interdependence of corporations and stakeholders (customers, employees, investors) is higher than in the past. Corporation future depends on customers’ health, future employees’ competences, and the access to natural resources (Haass, 2010). In the past, Friedman (1970) argued: ‘Managers should simply serve the interests of business owners by making more money while playing by the basic rules of society’. Nevertheless, recently, many researchers have proven that the CSR activity influences consumer behavior and is used as a consumer value creation tool (Sen and Bhattacharya, 2001; Zeynali et al., 2012). The effect of CSR activities does not have to be positive, although many researchers suggest that positive relationship exists between the level of CSR and customer’s opinion about products and the company itself (Creyer and Ross, 1996; Brown and Dacin, 1997; Ellen et al., 2000). However, under certain circumstances, the effect of CSR activities may be negative, especially in the case of poor quality products (Sen and Bhattacharya, 2001). It is also unknown how to choose the right time, the scope, and the way to communicate CSR activities in order to create a positive effect on consumer value (Sen and Bhattacharya, 2001). Therefore, business leaders may have different approaches to CSR activities resulting from a company profile, personal values, and characteristics of management board members. Corporate social responsibility, despite its growing popularity, is not still clearly defined. According to most authors (Roberts, 2003; Campbell, 2007), it includes fair treatment of workers, customers, suppliers, environment protection (reduction of environmental impact), promoting civil society. Corporations presenting their impact on society or environment in their social responsibility reports (also called sustainability reports, or CRS reports) disclose information on the above-mentioned topics. Global Reporting Initiative guidelines (GRI 2011) recommend that corporations should report in three main dimensions: economic, environmental, and social. A social dimension should embrace information on labor practices and decent work, human rights, society, and product responsibility.