CSR Disclosure Breadth and Earnings Management: Evidence Consistent with Opportunistic Reporting in an Emerging Market

Abstract

This study examines the contemporaneous association between earnings management (EM) and corporate social responsibility (CSR) disclosure breadth in an emerging-market setting. Using a balanced panel of 136 manufacturing firms listed on the Tehran Stock Exchange across eight annual panel periods (2017–2024; 1088 firm-year observations), CSR disclosure is measured with a 33-item binary content-analysis index with explicit coding boundaries. The primary Kothari-style performance-adjusted signed abnormal-accrual measure is positively associated with disclosure breadth (β = 0.198, p = 0.031). A secondary modified Dechow–Dichev-style signed accrual–cash-flow residual sensitivity is positive but marginal (β = 0.285, p = 0.060), and real earnings management is positive but marginal in the beta-regression specification (β = 0.254, p = 0.071). In firm- and year-fixed-effects OLS, AEM-K remains positive and significant, AEM-DD remains marginal, and REM is not statistically significant. The evidence is associational rather than causal and is consistent with—but does not establish—an opportunistic-reporting interpretation in which financial-reporting opportunism can coexist with broader CSR disclosure.