Corporate accountability for modern slavery disclosure in Indonesia and Malaysia

What the paper says

Purpose This study aims to investigate the extent to which company and country-level factors determine modern slavery disclosure among Indonesian and Malaysian firms. Design/methodology/approach A random-effects panel data regression is used with 636 firm-year observations from 2018 to 2022. Secondary data were sourced from Datastream Refinitiv, corporate financial and sustainability reports, the UN Global Compact website, the World Bank and various online media portals. Findings The results show that corporate commitment to social responsibility, media coverage of modern slavery and the presence of sustainability assurance are positively associated with modern slavery disclosure. Conversely, gender diversity on corporate boards and the institutional environment quality (IEQ) do not exhibit a significant relationship with disclosure practices. Research limitations/implications The study’s focus on Indonesia and Malaysia limits the generalisability of the findings, as disclosure practices may differ in countries with stronger regulatory enforcement or different institutional pressures. Practical implications The findings underscore the importance of social responsibility initiatives, media pressure and external assurance in enhancing corporate transparency in modern slavery. Policymakers and stakeholders can leverage these insights to strengthen the disclosure requirements and corporate accountability frameworks. Originality/value This study expands institutional theory in terms of modern slavery issues and contributes to the growing body of literature on modern slavery and corporate social responsibility by providing empirical evidence from Southeast Asia, highlighting both organisational and environmental factors that influence disclosure behaviours in the Global South.