The effects of mandatory corporate social responsibility disclosure on corporate ESG performance: evidence from quasi-experiments in Taiwan

This study examines the causal impact of Taiwan’s 2014 mandatory corporate social responsibility (CSR) reporting regulation on corporate environmental, social, and governance (ESG) performance. Drawing on stakeholder and legitimacy theories, we argue that disclosure requirements enhance transparency, increase reputational pressure, and strengthen accountability, thereby motivating firms to reduce ESG-related controversies. Using panel data of approximately 1,500 publicly listed firms over 2010–2019, we exploit the staggered implementation of disclosure rules as a quasi-experiment. The results show that mandatory CSR reporting significantly reduces law violations, fines, and ESG incidents, supporting the view that disclosure-based regulation can improve ESG outcomes even without mandated CSR expenditures. The mechanisms appear to operate through transparency-driven monitoring, stakeholder pressure, and benchmarking against peers. However, the effects of mandatory external assurance are inconclusive, likely reflecting limited coverage and potential confounding from concurrent regulatory responses in high-risk industries. While these findings contribute to ongoing debates about whether disclosure mandates induce substantive behavioral change or symbolic compliance, generalizability may be limited given Taiwan’s specific institutional and cultural context.