The data trend may also be explained using legitimacy theory. The call for better
corporate governance may be interpreted by corporates as society saying that
companies are not meeting society’s expectations. One way of demonstrating good
citizenship could be greater disclosure of social impacts and generally greater
disclosure across a range of areas, thus demonstrating higher levels of “accountability”
and good governance. This is consistent with one strategy an organization can use to
legitimate its activities: “the organization can adapt its output, goals and methods of
operation to conform to prevailing definitions of legitimacy” (Dowling and Pfeffer,
1975, p. 127, cited in Deegan, 2000). This conclusion is further supported by the results
showing “human resources” and “community” disclosures increasing from 1997 to 2001.