|CV: Curriculum Vitae from Carlos Serrano Cinca, professor in Accounting and Finance at the University of Zaragoza (Spain)|
Gutierrez-Nieto, B; Fuertes-Callén, Y.; and Serrano Cinca, C. (2008): "Internet reporting in microfinance institutions", Online Information Review, Ed Emerald, Vol. 32, No 3, pp 415-436
Purpose This paper researches how and why Microfinance Institutions' (MFIs) disclose financial and social information on the Internet. The legitimacy theory provides the theoretical framework.
Design/methodology/approach An empirical study analyze factors influencing MFIs to publish financial and social information on the Internet. The model is tested by means of regression analysis. The sample contains publicly available data of 273 MFIs' websites.
Findings The paper finds that MFIs' Internet presence overall is scarce and argues for greater levels of disclosure. It is found that large MFIs with a high degree of Internet public exposure disclose greater amounts of information on their Web sites than smaller MFIs with a low degree of public exposure. It is found that for-profit MFIs disclose more financial information on their Web sites, while NGOs reveal more social information.
Practical implications -MFIs should be proud to tell the world what they are doing. MFI managers need to remember that transparency increases funds from donors. Donors are mostly based in developed countries, so the Internet plays a key role in disclosure and attracting potential donors. Thus, managers are encouraged to increase MFIs disclosure levels-especially on the Internet.
Originality/value Academic research is still scarce regarding the factors that influence MFIs' Internet disclosure. This is an important area of study because full disclosure offers enormous benefits. Because MFIs have a social mission, they legitimate in the eyes of their donors by disclosing social information. Because they are also financial institutions, they have to show that they use efficiently the funds they receive.
Disclosure, Internet Financial Reporting, Microfinance Institutions (MFIs), Microcredit, Social Performance.