SOME EVIDENCE OF ENVIRONMENTAL REPORTING BY SHARIAH COMPLIANT COMPANIESIN MALAYSIA

Our study examines environmental disclosure practices of Shariah approved companies. The study investigates the extent Shariah approved companies report on the environment and compares this with non-Shariah approved companies. We also examine four variables that may influence the level of environmental disclosure in Shariah approved companies: size, number of Muslim directors, impact the activities of the company has on the environment (environmental sensitivity) and profitability of the company. Results provide some evidence that Shariah approved companies have a higher level of environmental disclosure. Further, size and environmental sensitivity, unlike profitability, do not affect the level of environmental disclosure of Shariah approved companies. These findings are inconsistent with the results of prior studies (Berthelot et al., 2003; Deegan and Gordon, 1996). The study makes an important contribution to the literature as there is a paucity of research which examines the influence of religion, in general, and Islam, in particular, on theextent of environmental disclosure.