Benefits that companies derive from disclosure of social and environmental information in annual reports:
- Top Management/Board of Directors: top Management needs the disclosure to respond to press criticisms, answer shareholders‟ questions and ensure that company policies are followed.
- Board of Directors, because of their growing legal liability, needs to know in some details what social programmes the company undertakes.
- Environmentalist and other stakeholders:Management can disclose social and environmental information to satisfy the above groups.
- Social and environmental disclosures influence some investors decisions.
- Disclosures also differentiate a company from its competitors.
- It can confer on the firm, some level of acceptability within the local environment.
- It may indicate the ability to manage key resources, risks and relationship