Stakeholders' engagement disclosures on Malaysian local authorities' websites: institutional perspective / Mariam Midin

Stakeholder engagement has grown in importance today and has become one of the important elements in advancing sustainability agenda in public sectors. This study aims to determine: 1) the extent of stakeholder engagement disclosure, and 2) factors influencing the disclosure (public sector reform initiatives), which include internal goals, e-community, E-pbt star rating, ISO commitment and council's size on Malaysian local authorities' websites using an institutional theory framework. Adopting a modified stakeholder engagement index to measure the extent of stakeholder engagement disclosure, the unit of analysis for this study consisted of 108 Malaysian local council websites. To reduce any subjectivity, the disclosure index was unweighted that encompassed 40 items. Based on the findings, it appears that there were low-level disclosures of stakeholder engagement information on the Malaysian local authorities' websites, which were inclusive of only 12 out of 40 items (30%). In addition, all factors were found to have significant relationships with the extent of stakeholder engagement disclosure. One of the most significant contributions from this study is that, it was found that e-pbt star rating and e-community significantly influenced the extent of disclosure, which established the evidence of coercive pressure from the stakeholders, particularly the public and higher levels of government. In addition, institutional isomorphism also contributes in understanding factors, such as internal goals and ISO commitment (normative isomorphism), which may influence the extent of stakeholder engagement website disclosures by local authorities. The study provides insights into the websites stakeholder engagement disclosure in a developing country and adds support to institutional isomorphism as a valid theoretical framework within this context. One of the most important practical implications is to highlight the ability of local governments in developing countries such as Malaysia for being able to disseminate stakeholder engagement information through their websites to increase greater transparency and accountability, which in turn, advancing sustainable development in public sectors.