3.3 Government ownership Government‐owned companies tend to be politically sensitive because their activities are more visible in the public eyes and there is a stronger expectation for such firms to be conscious of their public duty (Ghazali, 2007). CSR activities, by their very nature, ideally, can reflect how government entities are willing to serve both the business interests and society’s well‐being. Thus, government owners are likely to generate pressures for companies to disclose additional information because the government, as a body that is trusted by the public, will need to meet its stakeholders, i.e. the public’s expectations. In other words, public disclosure of CSR activities can function as a critical vehicle to legitimise government‐owned enterprise activities. Both Eng and Mak (2003) and Ghazali (2007) provide evidence of a positive and significant impact of government ownership on CSR disclosure. In India, there are high expectations set upon CPSEs which were specifically set‐up postindependence as vehicles for industrial development and employment generation. However, a recent review of the World Bank of the governance of these entities (World Bank, 2010) suggests that corporate disclosure varies in quality and that they may need the support of professional expertise from private sector to improve governance and transparency. The promulgation of the CSR guidelines specific to CPSEs in 2010 by the Department of Public Enterprises thus can be seen as a form of coercive pressure from the government for CPSEs to implement CSR activities and to report upon them. Based on the preceding discussion, we, therefore, propose the following third hypothesis: H3. There is a positive relationship between government ownership and the level of CSR disclosures