The Impact of Readability of Information Disclosed about Social Responsibility on the Credit Status and Cost of Capital
Quarterly Journal of Securities Exchange

Quarterly Journal of Securities Exchange

The Impact of Readability of Information Disclosed about Social Responsibility on the Credit Status and Cost of Capital

Document Type : Original Article

Authors
yahya kamyabi 1
vahid oskou 2
majid moradi 3
1 Professor, Department of Accounting, Faculty of Administrative and Economic, University of Mazandaran, Babolsar, Iran
2 Assistant Professor, Department of Accounting, Faculty of Humanities and Sports Sciences, Gonbad Kavous University, Gonbad Kavous, Iran
3 Assistant Professor, Department of Accounting, University Saveh Branch, Islamic Azad University, Saveh, Iran
10.22034/jse.2025.12406.2251
Abstract
The disclosure of corporate social responsibility (CSR) information is increasingly becoming mainstream in corporate reporting. However, limited research has been conducted on the value and informational content of these disclosures. On the other hand, evidence suggests that the motivation for CSR disclosure by companies influences their financing conditions. Accordingly, this study aims to examine the impact of the readability of CSR information on companies’ credit ratings and cost of capital, specifically as the cost of borrowing. The research data were collected for 146 companies over a seven-year period from 2016 to 2022, sourced from the Comprehensive Database of Listed Companies (Codal), disclosed CSR reports on company platforms, interpretive reports, and financial data from the Rahavard Novin software. The results indicate that the readability of CSR information has a significant and positive impact on companies’ credit ratings and cost of capital. These findings were further validated and reinforced through sensitivity analysis tests. Overall, the results demonstrate that companies with strong CSR performance and readable CSR disclosures can improve their credit ratings and reduce their cost of capital. In other words, the readability of CSR information serves as a signaling tool to the market, reducing financing risks, which aligns with the principles of signaling theory and the disclosure hypothesis.
Keywords
Corporate Social Responsibility Report Readability
Cost of Capital
Credit Status
Subjects
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Quarterly Journal of Securities Exchange
Volume 18, Issue 72
Autumn 2025
Pages 103-136