No. 179: Stakeholder Orientation in CSR Reporting of Non-Listed Banks

We investigate the role of stakeholders in mandatory CSR reporting of non-publicly listed savings banks in Germany. They are established by municipal trustees and serve clients in their distinct operating area. Reporting discretion under the Non-Financial Reporting Directive leads us to expect variation in mandatory CSR reporting arising from materiality assessment differences due to divergent interests of banks’ stakeholders and impact of banks’ activities on the stakeholders. We document that the CSR reports and specific CSR dimensions are associated with the interests of municipal trustees and to a lesser extent with the interests of clients. The associations with less salient stakeholders, such as private clients, are more pronounced in banks with a holistic accountability approach. This indicates that savings banks consider interests of relevant stakeholders in the CSR reports but differentiate between salient and less salient stakeholder groups. Our findings for medium-sized banks inform policy discussions about detailed CSR disclosure requirements (e.g., the European Sustainability Reporting Standards) and extension of reporting scope to small and medium-sized firms with regional orientation and absence of typical shareholders.