Compliance with the global reporting initiative standards in Jordan: case study of hikma pharmaceuticals

ABSTRACT

Corporate Social Responsibility (CSR) disclosures have gained great attention both in media and academic community through years in manufacturing companies. Fewer evidence was provided regarding CSR in pharmaceutical sector due to the characteristics of such firms. In this paper, we shed light on CSR disclosures’ practices adopted by Hikma Pharmaceutical (Plc.). Based on previous literature  in the field, we adopt a content analysis of Hikma Plc. CSR disclosures related to the three main fields defined by the Global Reporting Initiative (GRI) standards 2016: Economic standards (GRI 200), such as values of integrity, business ethics through anti-corruption practices, and competitiveness through tax optimisation. Environmental standards (GRI 300), especially ISO14001 certification that specifies the requirements for an environmental management system that an organisation should use to be considered as environmentally responsible. Social Standards (GRI 400), especially those that respect and uphold the principles of human rights of the UK Modern Slavery Act (MSA). Our results show that Hikma Plc. displays a higher level of compliance with GRI international standards, mainly in the social field more than economic and environmental disclosures. Our study can be used as a useful framework for CSR disclosures in the pharmaceutical industry in Jordan and abroad. Our findings help in guiding investors when allocating resources in the pharmaceutical industry and regulators when issuing new standards on CSR policy.

KEYWORDS:

• EES disclosures
• sustainability
• pharmaceutical industry
• GRI standards
• hikma plc jordan

1. Introduction

In today’s business world, companies cannot be measured on profits alone. The external environment can play a major role in the perceived value and success of an organisation (Smith 2008). Siew (2015) argued that sustainability reporting has been granted great attention by corporations, governmental agencies worldwide given the demand of stakeholders for greater transparency on both environmental, governance and social issues. The popularity of such reporting is evidenced by the development of various sustainability measurement tools in the last two decades including the Global Reporting Initiative (GRI), Carbon Disclosure Project (CDP), Kinder, Lydenburg Domini (KLD) rated items. The pharmaceutical sector plays a crucial role around the world due to population growth, increasing healthcare standards, new disease occurrences (Blood sugar rates, Cancer, AIDS, Malaria, Ebola, COVID-19, etc.), aggressive competition and political pressures. The industry engages in the discovery, production, and marketing of a variety of drugs to meet patients’ health needs. Smith (2008) argued that the pharmaceutical industry is under immense pressure both by external and internal stakeholders to deliver products in an efficient and cost-effective manner. Due to economic and political constraints, these organisations must be socially responsible to challenge these issues (Murphy and Poist 2002). Unlike many other industries, the pharmaceutical sector carries enormous ethical responsibilities towards the public. Industrial players do not only engage in the business for the sale of the drugs but should behave in a socially responsible manner. The pharmaceutical industry is therefore expected not to engage in a dissipated market campaign ditching the poor in terms of high prices of goods and ‘no pay, no cure’ attitude. Lebeault, F and Esposito (2017) argued that it is important for researchers to focus on individual business sectors such as pharmaceutical industry, chemical industry, etc., to examine the great potential gains arising from CSR practices.

Our research contributes to the current literature in several ways: First, while most of the studies dealing with CSR issues focused on manufacturing companies and related environmental disclosures and compliance, we focused through this paper on healthcare sector company and related social and human rights disclosures components of CSR. First, while most studies address CSR issues by countries, regions, and stock markets, we focus on a specific case study: Hikma pharmaceutical company. Second, while most of the empirical evidence addresses CSR issues in developed markets, our study focuses on an emergent country: the pharmaceutical industry in Jordan. Finally, unlike quantitative studies using a general disclosure index of CSR and its relationship with firm financial performance, we have used a qualitative approach to assess the compliance of Hikma Plc. CSR disclosure practices with Global Reporting Initiative GRI standards (economic, social and environmental) during an eight-year period (2008–2016). The research addresses following question: To which extent does Hikma Plc. complies with Global Reporting Initiative GRI (2016) standards? The remaining paper is structured as follows: first, we present a theoretical background for CSR in the pharmaceutical industry (Section 2). Second, we display Hikma Plc’s. profile with some key financial figures (Section 3). Third, we describe our research methodology for the case study (Section 4). Then, we analyse and interpret our results (Section 5). Finally, we conclude the paper and provide some limitations and future research perspectives (Section 6).

2. Corporate social responsibility: theoretical background

Since the Carroll (1979) conceptual model, numerous definitions of Corporate Social Responsibility (CSR) abound in the literature. CSR differs for each company, depending specifically on firms’ industrial sector, governance structures and management’s general vision for CSR activities. Huang and Watson (2015) defined CSR as company’s voluntary compliance efforts to further some social purposes. such as, health care provision, poverty alleviation, infrastructural development etc. beyond legal requirements and financial interests. According to Spence (2010) the term CSR refers to the ‘kind of things companies do in their efforts to navigate these swirling currents of changing expectations, expectations that have never loomed larger in the daily lives of companies, including oil and gas companies’. Moller, K. and Verbeeten (2011) defined CSR as a company voluntary contribution to sustainable development which goes beyond requirements of the law. Hence, CSR aimed at addressing the socio-economic development challenges of the country (health care provision, poverty alleviation, infrastructural development, etc.). The CSR concept is based on several theories, including Legitimacy Theory, Social Contract Theory and Stakeholders theory. From a critical review of legitimacy theory, Hybels (1995) stated that rather than viewing legitimacy as something that is exchanged among institutions, legitimacy is better conceived as both part of the context for exchange and a by-product of exchange. Legitimacy itself has no material form. It exists only as a symbolic representation of the collective evaluation of an institution, as evidenced to both observers and participants, perhaps most convincingly by the flow of resources. These resources must have symbolic importance to function as value in social exchange. Burlea and Popa (2013) conceptualised legitimacy theory as an instrument that provides organisations with support for voluntary CSR implementation and development in order to ‘fulfill their social contract that enables the recognition of their objectives and the survival in a jumpy and turbulent environment’. They further explained that legitimacy theory can be sustained only if management culture can link traditional rules and tenets with contemporary beliefs. Legitimacy theory is therefore fundamental in explaining behaviour of the organisations towards managing social responsibility policies and their results. Finally, Kuruppu, Milne, and Tilt (2019) argued that legitimacy theory, as a framework to understand legal framework behaviour, is used extensively in social and environmental accounting literature. According to Donaldson (1982), Donaldson and Dunfee (1999), Social Contract Theory can be considered a theory of morality which assumes an intrinsic social relationship between corporations and the public to adhere to business ethics. It involves re-ordering of corporations in a useful way to expressively harmonise the interests of the stakeholders into corporate values. This social contract theory involves companies’ direct commitment to the society (Nbete 2012). Whichever the case, Social Contract Theory strengthens peaceful coexistence and respect for each other’s liberty in an ecosystem. Stakeholders are groups or individuals (including shareholders, communities’ customers, suppliers, public associations, media, governmental bodies and even society as a whole) whose interests can influence or be influenced by the companies’ objectives (Freeman 1984; Harisson, Freeman, and Abreu 2015). According to Ali and Abdelfettah (2012), the narrative approach viewed obligations to stakeholders by the organisation as a moral justification; while the analytical approach supports the argument that CSR to stakeholders enhances achievement of corporate objectives. Hence, the voluntary adoption of CSR to the stakeholders enhances trust with the firms and their products, improves firms’ competitiveness and social capital (Clarkson 1995).

Recent studies highlighted the importance of CSR disclosure practices in the pharmaceutical sector. For instance, Demir and Min (2019) stated that pharmaceutical manufacturing companies beat other businesses in terms of the overall completeness of reporting, certain discrepancies exist among these firms in the content of their CSR disclosures. Specifically, pharmaceutical companies beat the averages on multiple key CSR topics. According to Luu (2020), the estimated results showed the substantial total belongings of employee perception of internal CSR practices on pharmaceutical firms’ performances through the influencing mechanism of employee innovative conduct. Lebeault, F and Esposito (2017) added that CSR programmes should be executed irrespective of firm size. CSR is effective because it invests in all company stakeholders including executives, shareholders, internal and external customers, and governments, creating constructive relations which progress reputation and financial effectiveness. Sharabati (2018) argued that there are associations between CSR variables, and all the three variables are powerfully related to business performance, also the environmental disclosures have noticeable outcomes on Jordanian pharmaceutical industry’s business performance, followed by economic disclosures, and then social disclosures.

3. Hikma Plc. company profile

Jordan is a developing country whose pharmaceutical industry contributes mainly to the export sector. Although shortages in supply and quality of drugs are challenges ravaging developing countries’ health systems, Jordan has shown significant prospects in the pharmaceutical industry area. This industry is the third major exporting sector with a reasonable contribution to Jordan Foreign exchange (Mustafa et al. 2011). Hikma Plc. was established by S. Darwazah in Jordan since 1978. This company is a major supplier of in-licenced and branded drugs. With a mission of providing high-quality, affordable drugs and diverse product line; the company became a multinational pharmaceutical group. Despite the competitiveness and strict regulations guiding the pharmaceutical industry, the company has been able to market its brand beyond the shores of Jordan to the USA, Egypt, Algeria, Tunisia, Morocco, Portugal and Saudi Arabia. The year 1980 witnessed the establishment of the first FDA (Food and Drug Administration) with the aim to inspect manufacturing facilities in Jordan. This provided a major turn-around for Hikma Plc. In another giant stride, Hikma Plc. acquired West-Ward Pharmaceuticals in Eatontown, New Jersey in the 1990s. Recently, it added Roxane Laboratories in Columbus, USA. More important acquisitions were made in Saudi Arabia and Tunisia. During its years of operations, Hikma Plc. was able to produce high quality affordable drugs and injection solutions both the local and international market with competitive returns to its shareholders. For the period under study (2008–2016), the company performed reasonably well despite the global economic downturn and the subprime crisis (2008–2009). Its achievement can be attributed to the strength of its diversified activities. Diversification encourages investment portfolio that enhances corporate performance. This has strategically positioned the company in a higher competitive advantage in the pharmaceutical industry. Hikma Plc.’s key performance indicators indicated revenue growth from +9.7% in 2009 to +25.6% in 2011. Hikma Plc. maintained a world class manufacturing capability by expanding and investing approximately $57 million in 2008 due to the growing demand for its products. The acquisitions of new facilities and upgrading of the existing structures raised the capacity of the company to produce high quality affordable drugs. These acquisitions and innovations brought significant changes to Hikma Plc’s. productivity, return on investment and supply chain efficiency. The core value of Hikma Plc. since its establishment was the compliance with higher CSR standards due to the sensitiveness of such sector to environmental, political, and social requirements. Specifically, Hikma Plc. established its CSR programme in 2007 and since then it has continuously and strategically committed to Global Reporting Initiative’s (GRI) guidelines. This is evident from the company’s engagement with its host community, especially with its investment on environmental, labour and governance practices. Indeed, multi-country operations and portfolio diversification implies higher commitment of the company to its environment, personal and community in general. Figure 1 and Figure 2 both show a summary of the main financial data (revenues, gross profit, profit before tax, net income, total assets, total equity) and their progression through time.

Figure 1. Hikma plc. key financial data (2008–2017) in thousands of $

Figure 2. Hikma pls. key financial data (2008–2017) increase/decrease in thousands of $

As shown in Figure 1 and Figure 2 all key figures show an increase during the entire period. Both total revenues and total assets show the greatest increase among all other figures. This is related to the activity diversification of Hikma Plc. in pharmaceutical solutions and cross-country operations of the company (USA, Morocco, Tunisia, Egypt). However, profit for the last four years was deemed stable and grew slightly as global economic recession was noticed during this period.

4. Methodology

Hikma Plc. CSR disclosure policy is guided both by local practices and the Global Reporting Initiative’s (GRI) standards. Adams and Narayanan (2007) argued that according to the GRI guidelines, a typical report should address the following areas: vision and strategy; corporation profile; governance structure and management systems; GRI content index; performance criteria (economic, social, and environmental). Based on Min et al. (2017) classification of the three sustainability pillars (economic sustainability, environmental sustainability, and social sustainability), we assess how Hikma Plc. complies with the three main standards: Economic Standards (GRI 201–207), Environmental Standards (GRI 300) and Social Standards (GRI 400). These Standards were extracted directly from the website: (https://www.globalreporting.org/standards/). Appendix 1 shows a summary of the Full GRI standards. Mainly, we conduct a content analysis of CSR main disclosures domain of Hikma Plc. for eight years (2008–2016).¹ For each year, we manually extract the number of disclosed items (economic, environmental, and social) from the annual reports and the sustainability reports of the company. Then, we identify the GRI standard (2016) that corroborates with such disclosed items. Finally, we count the total number of items disclosed for the three fields each year and assessed the percentage of disclosures adopted by Hikma Plc. With regards to the international standards (GRI 2016).

5. Results and discussion

In this section, we first display Hikma Plc’s. CSR disclosures practices to assess whether the company complies with the Global Reporting Initiative Standards (2016). We focus on the three main fields: Economic GRI 200, Environmental GRI 300 and Social GRI 400. Second, we discuss our results and link the findings to the previous literature in the pharmaceutical sector sustainability reporting.

5.1. Results

5.1.1 Economic Disclosures

According to Uchehara (2019), competitiveness is beyond quality and prices of product, to include market capitalisation and sufficient investment return. Companies with good social responsibility policy stand a better position in the competing market (5). Most scholarly researches have shown a significant positive relationship between CSR and firms’ competitiveness (Uchehara 2019; Castro, Guzman, and Serna 2015; Battaglia et al. 2014; Tomomi 2010). Competitiveness is a key benchmark for Hikma Plc. to maintain business growth. In a bid to enhance its competitive advantage and network, Hikma Plc. collaborated with the Jordan Standards and Metrology Organization (JSMO), International Organization of Standardisation (ISO), Swedish International Development Cooperation Agency adoption of ISO 26000 on Social Responsibility within the Middle East and North Africa (MENA) region. All these efforts made Hikma Plc. Shifting from a sole ownership in the 1990s to a multinational pharmaceutical company. The profit before tax increased by 27.6% to $121.0 million in 2010, as compared to $94.8 million in 2009. Though, the return on investment (ROI) declined in 2011, it stood positive at +8.1%. The years 2009 and 2010 reflected a steady rise in return on investment. These indicators suggest that Hikma Plc. has continued to maintain and sustain a competitive advantage in the pharmaceutical industry worldwide. Hikma Plc. has been at the forefront of integrating CSR standards by striving to ensure sustainable business practices. This was demonstrated in their support for community friendly initiatives that cares for their well-being as well as maintaining healthy relationships with the shareholders. To achieve this robust reporting height, Hikma Plc. maintains strong governance structures that drive CSR programs all through Hikma group. By the end of 2008, Hikma Plc. has taken a momentous review of its governance structures to drive the CSR programs.

In reflection of Hikma Plc’s. unwieldy genuineness to integrate CSR in its business strategy, a 5+

-year (2010–2015) CSR plan was designed to address business ethics, well-being, and education of community and its environment. This strategy aimed at enhancing Hikma Plc’s. competitive position and reputation among the global pharmaceutical industries. Specifically, health awareness campaigns were organised at different forums to address labour regulations in respect of workplace health and safety. The period 2008–2011 witnessed several health awareness campaigns. ‘You are Hikma’ training sessions and local fundraising treatment and research of chronic diseases such as AIDS, Tuberculosis, Malaria, heart diseases, breast Cancer awareness, Anti-Obesity and Diabetes campaign were organised through time. Table 1 displays detailed economic disclosure items and their compliance with GRI 200. Analysis of Table 1 shows that Hikma Plc. disclosed mainly items GRI 205 (anti-corruption), GRI 206 (anti-competitive behaviour) and GRI 207 (tax strategy and approaches). These items are aligned with Hikma Plc’s core values of integrity, business ethics through anti-corruption practices, and competitiveness through tax optimisation and avoidance.

Table 1. Summary of the economic disclosures

Table 1. Economic Disclosures
2008	2009	2011	2012	2013	2014	2015	2016
Honesty and integrity lie at the core of our business values. Ethical issues continue to be overseen by the Ethics Committee, which is chaired by Ronald Goode an independent non-executive Director, and reports to the Board of Directors (GRI 102, GRI 103). Through our partnership with PACI (Partnering against Corruption Initiative) we are committed to a zero tolerance policy to all forms of bribery and corruption (GRI 205, GRI 206). We have also committed to developing and implementing internal systems and controls for that policy, which are supported by the ongoing delivery of anticorruption training (GRI 205, GRI 206). We previously committed to all Hikma man (agement signing the Company wide Code of Conduct, and this undertaking continues. The Company continues to operate a whistle-blowing policy – to encourage reporting of activities that are not in compliance with the Code of Conduct, ethics or financial reporting guidelines which along with Share Dealing Code and Disclosure Policies will be the subject of further education in 2009 (GRI 205, GRI 206). We have continued to work with our suppliers to understand their ethical policies (including human rights and environmental behaviour), targeting certain key suppliers with a questionnaire to investigate this further. During 2009 the CSR Committee will work to identify where action may need to be taken with suppliers to align their values with those of Hikma (GRI 205, GRI 206, GRI 207).	Hikma should encourage all counterparties to adopt the policies and behaviours of Hikma, and to support the high levels of ethical business practice undertaken by Hikma (GRI 205, GRI 206, GRI 207).	Engaged The Good Corporation to audit our operations in Jordan and Saudi Arabia (GRI 202). Worked with ministries of health in MENA to ensure the dissemination of accurate information regarding the contra indications of Actos®, an important in-licenced diabetes treatment (GRI 202, GRI 206). Won the Her mes Transparency in Governance Award for ‘Best FTSE 250Audit Report’ (GRI 206). Engaged The GoodCorporationtoaudit our operations in Portugal and the US (GRI 205, GRI 206, GRI 207).	Received IFC Client Leadership award for benefit to patient health and sustainability practices (GRI 202). Updated Code of Conduct with greater focus on integrity. (GRI 103) Implemented new social media policy to unify image as trusted and responsible company on virtual platforms. Launched speak-up line in US and Europe (GRI 202). Maintained commitment not to undertake in-house animal testing and uphold the3rs – reduce, refine and replace.(GRI 205,GRI 206,GRI 207)	Promoting good business ethics (GRI 102). Establishing new guidelines for ethical sales promotion.(GRI 205,GRI 206,GRI 207)	- Promoting good business ethics (GRI 102) - Ensured strong ethical practices across the Group. (GRI 206) Management completed anti-bribery and anti-corruption training.(GRI 205,GRI 206,GRI 207)	Through stringent internal controls and a healthy ethical culture, we ensure the future prosperity of our business and stakeholders (GRI 201, GRI 203). Transparency in corporate governance (GRI 102). Ensuring an ethical approach runs across the Group.(GRI 205,GRI 206,GRI 207)	Through stringent internal controls and a healthy ethical culture, we ensure the future prosperity of our business and stakeholders (GRI 201) Responsible business initiatives (GRI 103) Transparency & anti-bribery and corruption.(GRI 205,GRI 206,GRI 207)

5.1.2 Environmental disclosures

Russell, Milne, and Dey (2017) argued that environmental accounting research overwhelmingly focuses on economic entities and their inputs and outputs. Hikma Plc’s. environmental policy supports initiatives that comply with environmental legislation in all the countries where it operates. The company obtained ISO 14001 certification that specifies the requirements for an environmental management system that an organisation should use to be considered as environmentally responsible.² Hikma Plc. goal was to reduce the impact of its polluting activities on climate change, gas emissions and to continuously improve its environmental protection efforts.

In their stride for commitment to the ethical principles, several staff trainings, seminars on health, safety and environmental awareness were at the forefront of the company’s corporate governance principles. Proactively, Hikma Plc. has been differentiating itself from the competitors by strongly engaging in effective CSR strategy. The company renewed its accreditations at all production facilities worldwide. It also reports periodic changes in waste recycling, carbon emissions, and energy and water consumption. Table 2 displays the practices of Hikma Plc. in terms of environmental disclosures and their compliance with GRI (301–308). Results show that the company focused on the GRI 305 emissions, GRI 307 environmental compliance and GRI 308 supplier environmental assessment. All these items are a part of Hikma Plc. core values. Table 2 highlights Hikma Plc’s. environmental impact reporting and mitigation, waste recycling, water and energy saving and finally environmental certification of the company ISO 14001 in 2012 and ISO 9001 for the quality of management.

Table 2. Summary of the environmental disclosures

Table 2. Environmental Disclosures
2008	2009	2011	2012	2013	2014	2015	2016
-Our Environmental Policy states that we will manage our operations to minimise our impact on the environment where possible. Our critical priorities remain the reduction of: energy consumption; water usage; and waste production.(GRI 302,GRI 303, GRI 305,GRI 307, GRI 308). -We aim to improve our performance through integrating our Environmental Policy into all activities at Hikma, and our key performance metrics reflect these priorities.(GRI 307) A significant achievement during the year, incorporating all three of these areas, was the certification of our main Hikma Jordan and AMC Jordan manufacturing plants to ISO14001 standard.(GRI 307,GRI 308)	Mitigating our environmental impact should be offered as standard by Hikma as a company. (GRI 307, GRI 308) We should promote a sustainable presence in our communities through recycling, waste reduction and energy efficiency (GRI 302, GRI 307, GRI 308) ‘You are Hikma’ – Energy and water conservation, recycling and waste management – Solvency recovery pilot (GRI 302, GRI 303, GRI 305, GRI 306)	Renewed environmental management systems (EMS) certification of the (ISO) 14,001:2004 in Hikma’s units inJordan and Egypt. (GRI 307, GRI 308) Expanded facilities in all regions in order to meet global demand for our products while complying with local and international environmental standards (GRI 307, GRI 308). Continued regular training of employees on sustainability and environmental matters (GRI404). Inaugurated a newlyophilisation plant inPortugal, completed to a high environmental standard(GRI 307, GRI 308). Committed to increasing recycling of bottles, cans, cardboard and paper at our US operations (GRI 307, GRI 308).	Renewed ISO 14001 certification in Egypt and received the ISO 9001Certificate for quality management. Renewed ISO 14001 and successfully completed a surveillance audit at our main plant in Jordan. Collaborated with international organizations on the implementation of ISO 26000, the social responsibility certification, in the MENA initiated renewable energy project at our Injectables facility in Portugal, using solar power to drive energy savings. Collaborated with global entity to apply optimal ways to save energy, installed energy efficient and low emission machinery at our facilities in Jordan (GRI 302, GRI 303, GRI 305, GRI 307, GRI 308).	Minimising our environmental impact (GRI 307, GRI 308). Reducing water consumption (GRI 303). Measuring our carbon footprint (GRI 305, GRI 306).	Minimising our environmental impact (GRI 307, GRI 308). Used our global sustainability software to streamline our reporting (GRI 307). Received recognition for implementing Environmental Stewardship Initiatives at West-Ward Pharmaceuticals in the US (GRI 307, GRI 308).	We aim to limit our environmental impact by closely monitoring, reporting on and improving our operations. Reducing our energy and water consumption. Minimising waste	We aim to limit our environmental impact by closely monitoring, reporting on and improving our operations (GRI 307, GRI 308). Disclosing and improving our carbon emissions (GRI 305). Waste reduction and recycling Environmental preservation efforts (GRI 306).

5.1.3 Social disclosures

Parker and Chung (2018) argued that social responsibility has become an expanding concern and practice amongst corporations internationally. As Hikma Plc. employs more than 8000 people around the World, social disclosures are a must the management of the company. Hikma Plc. encourages all employees to comply with the highest standards of integrity and honesty and preserve its culture. Zero tolerance of bribery and corruption are usually communicated among all staff even at the cost of losing projects and financial benefits. O’Brien et al. (2016) argued that, given its ethical rather than legal basis; CSR with respect to human rights; refers to all relevant internationally recognised human rights, not just those formally applicable in any one particular jurisdiction. The organisation is committed to achieving best-practices across its operations, including the supply chain. Hikma Plc. works alongside its industry partners to uphold ethical labour practices and safeguard human rights. Hikma Plc. conducts regular audits to assess MSA compliance for its major suppliers and has a zero-tolerance policy towards any violations. Recently, Hikma Plc. requests its major suppliers to fill questionnaires every two-years that include MSA compliance. In 2016, Hikma Plc. introduced specific standard operating procedures to ensure that neither the company nor its partners are involved in modern slavery. In 2017, Hikma Plc. strengthened its ability to address this issue, incorporating modern slavery clauses into its suppliers’ questionnaires. Training sessions and development of the company’s human resources are encouraged among all employees’ levels. Hikma Plc. has also been supportive in the education sector of its community. Continuing education scheme is set up where eligible staff can pursue a higher degree. Rotation plans are set up for the employees to grow and expand their talents. Employee’s health and safety is also a priority for Hikma Plc. in that it was certified OHSAS 18001 for occupational health and safety with zero non-conformity and for meeting the requirements for pharmaceutical product design and manufacturing. Hikma Plc’s. employees enjoy numerous additional benefits including medical insurance for all employees and their families, travel insurance and a retirement plan via social security and maternity leave for female labour. Analysis of Table 3 shows that the company focused on GRI 401 (employment), GRI 402 (labour management relation), GRI 404 (training and education), GRI 405 (diversity and equal opportunity), GRI 406 (non-discrimination). All these standards are integrated into Hikma Plc. core values’ culture.

Table 3. Summary of social disclosures

Table 3. Social Disclosures
2008	2009		2011			2012			2013		2014	2015		2016
We remain resolute in our belief that investment in our communities brings benefit both to us and to those around us. This idea was embedded at the foundation of Hikma as a family-owned company. In many cases, our community involvement focuses on supporting young people with the aim of developing their professional skills, while at the same time providing a broader pool of talented recruits for Hikma. We have continued to build our university partnerships by providing student scholarships. Following on from our 2007 acquisition in Egypt, 150 students from Egyptian universities were supported through cross-departmental training at Hikma. In 2008, we launched a collaboration with the German Jordanian University in Amman, whereby three students will receive six-month technical training scholarships at Hikma’s German plant. We continue to give significant donations both financial and in kind. In 2008, the total value of our community investments was US$2,490,632. We also encourage employees to donate their time through volunteering to add capacity to the financial donations made by the Group. GRI 413, GRI 414, GRI 415, GRI 416, GRI 419)	Hikma does not exist in isolation. It wishes to engage in its local communities, recognising the importance of establishing a strong community footprint in all countries of operation Partnership with the Jordan River Foundation Global Volunteering Day-Fundraising for local homeless groups, disadvantaged families and the elderly GRI 413, GRI 414, GRI 415, GRI 416, GRI 419)		Donated much needed medicines to Libya including anti-infective,cardiovascular and diabetes products. Raised awareness by sponsoring anti-obesity and breast cancer campaigns. Raised money to fund breast cancer treatment and research in the US. Provided funding to develop an industrial pharmaceutical facility at Yarmouk University in Jordan. GRI 413, GRI 414, GRI 415, GRI 416, GRI 419)			Set corporate responsibility standard in MENA through Cr mapping research with Universities, sponsored local events to raise awareness of diabetes and obesity, including blood pressure and glucose testing. Active participant in the world economic forum, influencing MENA and global healthcare policies. Supported children with serious illnesses through the collection and recycling of soda and juice cans. Recognised by the senator of New Jersey, USA as a ‘stellar example of fruitful partnership between business and colleges’. GRI 413, GRI 414, GRI 415, GRI 416, GRI 419)			Supporting people and communities (GRI 413, GRI 414, GRI 415, GRI 416, GRI 419, GRI 404). Donating medicines (GRI 413, GRI 414, GRI 415, GRI 416, GRI 419) Supporting local schools and universities (GRI 413, GRI 414, GRI 415, GRI 416, GRI 419)		Supporting people and communities. Awarded the ‘Smoke-free Zone Certificate’. Addressed various community needs across our geographies through employee participation in the Hikma Volunteering Campaigns. GRI 413, GRI 414, GRI 415, GRI 416, GRI 419)	The success and wellbeing of the communities in which we are present, are vital to maintaining our business. We engage with our communities at all levels of the business through volunteering and Group sponsored activities. (GRI 413, GRI 414, GRI 415, GRI 416, GRI 419)		The success and wellbeing of the communities in which we are present are vital to maintaining our business. We are committed to supporting the communities in which we operate, through charitable social engagement, spreading health awareness and local volunteering (GRI 413, GRI 414, GRI 415, GRI 416, GRI 419)
Acting responsibly exists at the core of the way Hike does business, with the ultimate intention of improving the well-being of the patients (GRI 416) Using our products and building strong relationships with other stakeholders.(GRI 416) In April 2008 we undertook a group-wide Volunteering Day which focused on raising cancer awareness and supporting patients suffering from cancer (GRI 416)				Provided patients across MENA with an extensive portfolio of 537 compounds in 1,323 dosage forms (GRI 416) Launched imatinib, a leading treatment for breast cancer, in Jordan. Enhanced our pipeline of innovative cancer treatments through an agreement with AeternaZentaris to market perifosine in the MENA region. Expanded our global portfolio of affordable injectable products to 169 compounds in 308 dosage forms and strengths. Increased market share of written oral prescriptions by offering cost-effective, differentiated products like our dye-free amoxycillin suspension (GRI 416). Ensured delivery of quality products through adherence to the highest standards of manufacturing (GRI 416)			Engaged Pharmacovigilance (pv) consultants to review our pv systems in the MENA, EU and US. introduced the first locally produced oncology generic, Cemivil® (imatinib), into the formulary of Jordan’s King Hussein Cancer Center (KhCC), partnered with Americas to supply medicines to Syria. (GRI 416) received FDA approval for phenylephrine HCl injection and argatroban injection differentiated products for our US portfolio (GRI 416) maintained high-quality standards at our US FDA approved facilities in Jordan and SaudiArabia, which both passed recent FDA inspections. (GRI 416)	Treating major health issues. (Focusing on diabetes, heart disease, CNS and oncology, Addressing market shortages with reliable, supply of product (GRI 416). Delivering high quality, affordable, and differentiated products, Launching new products tailored to specific needs in local markets, Establishing operations in new markets. (GRI 416) Enhancing doctor and patient awareness and education, Hosting medical symposiums, Sponsoring public awareness campaigns for heart disease, diabetes and obesity (GRI 416).		Treating major health issues, Continued to address chronic diseases, such as heart disease, cancer and diabetes, Maintained secure supply of critical medicines, to patients in areas of strife in the MENA. (GRI 416) Delivering high quality, affordable and differentiated products, Launched 75 products across all our markets, received a total of 263 approvals. GRI 416, GRI 417 Enhancing doctor and patient awareness and education. GRI 416, GRI 417 Organised medical workshops for neuroscience, cancer, organ transplant, cardiovascular and diabetes. GRI 416, GRI 417 Arranged awareness campaigns across different therapeutic areas to raise awareness and help improve the health of our patients			The sustainability of our business relies on meeting the needs of our patients, both now and in the future (GRI 416). We engage with our patients through marketing and communications campaigns, focus groups and multiple customer feedback channels which, along with our practitioner advocates, ensures that we understand their personal and collective healthcare needs (GRI 416, GRI 417, GRI 418).		The sustainability of our business relies on meeting the needs of our patients, both now and in the future (GRI 416). We engage with our patients, our key stakeholder, through marketing and communications campaigns, focus groups and multiple customer feedback channels to meet their personal and collective healthcare needs (GRI 416, GRI 417, GRI 418).
We value our people as our most important asset (GRI 401, GRI 402). To successfully grow our business, we need to develop and reward our people With our commitment to maintaining the highest quality standards and cGMP (current good manufacturing practices) technical training has always been a top priority across the Group (GRI 401, GRI 402). In 2008, analysis of GRI data helped us to identify areas of need for further training (GRI 401, GRI 402). We also maintained our Continuing Education Scheme, which supports employees in full funded further education programs (GRI 401, GRI 402).		Our people are our greatest asset, They are ambassadors for the Company and we aim to support them as fully as possible, in terms of training, welfare, recognition and supporting diversityProfessional and technical training and developmentTransparentremunerationstructure with job grading and levelling (GRI 401, GRI 402) Compliance with health and safety regulation (GRI 401, GRI 402)			Implemented our continuous education program, funding 25 employees for Bachelors and MastersDegrees (GRI 401, GRI 402). Leveraged our expertise in treating diabetes, heart disease and cancer through employee awareness programs (GRI 401, GRI 402). Strengthened the capabilities of our 1,700 strong sales and marketing team through training (GRI 401, GRI 402) Transferred skills and expertise from our European operations to the US through the relocation of keyoperationalandqualitymanagers. Developed employees technical skills and expertise through our contract manufacturing partnerships (GRI 401, GRI 402).		Launched leadership training program for middle managers with the American University of Beirut (AUB) (GRI 401, GRI 402). Raised awareness amongst employees on key health issues such as obesity, breast cancer and heart disease (GRI 401, GRI 402). Active member of the global smokefree partnership and leader of smokefree initiatives in Jordan. Hikma has been smokefree since 1994. Supported employees impacted by hurricane sandy and participated in wider relief efforts renewed OHSAS 18001, the employee health and safety certification (GRI 401, GRI 402)	Supporting people and communities (GRI 401, GRI 402)		Supporting people and communities (GRI 401, GRI 402)			The lifeblood of our Group, it’s imperative that our people are motivated to drive Hikma forward to achieve our common goals (GRI 401, GRI 402, GRI 403, GRI 404, GRI 405, GRI 406). At Hikma we have shared values and a distinct ethos, developed for and by our people (GRI 401, GRI 402, GRI 403, GRI 404, GRI 405, GRI 406) We hold regular Company forums and internal communications campaigns to ensure we continue this alignment (GRI 401, GRI 402, GRI 403, GRI 404, GRI 405, GRI 406).		- The lifeblood of our Group, it’s imperative that our people are motivated to drive Hikma forward to achieve our common goals.(GRI 401,GRI 402,GRI 403,GRI 404, GRI 405,GRI 406) - As the driving force behind our success, we empower and encourage our employees to lead innovative initiatives and maintain a healthy work-life balance.(GRI 401,GRI 402,GRI 403,GRI 404,GRI 405,GRI 406)

Table 4 shows a summary of GRI disclosed items by Hikma Plc. related to the three fields (economic, environmental, and social). It shows that Hikma Plc. discloses more items related to social rather than environmental and economics. The mean year-disclosure is 5.3 items for economic standards, 6.1 items for environmental issues but jump to 14 items for social concerns. This is due to the multi-country operations of the company. In fact, at Hikma Plc., human resources are of absolute priority for the top management. Figures 3, 4 and 5 show the trend of each disclosure item for the entire period (2008–2016). The disclosure level of social items is enhanced through time.

Figure 3. Hikma GRI Standards Full disclosures

Figure 4. Hikma Plc. summary of the GRI disclosed items for the full period

Figure 5. Hikma Plc. summary of the GRI disclosed items for the entire period

Table 4. Summary of the disclosed items during the entire period

Year	Economic disclosures (GRI 201–207)	Environmental disclosures (GRI 301–308)	Social disclosures (GRI 401–419)
2008	7	6	12
2009	4	9	7
2011	6	8	13
2012	6	5	14
2013	4	6	13
2014	5	5	10
2015	6	4	22
2016	5	6	21
Total	43	49	112
Mean/year	5.3	6.1	14

5.2. Discussion of the results

In this section, we discuss and analyse Hikma Plc. sustainability practices with regards to the economic, environmental and social fields best practices and its compliance with previous research in the pharmaceutical sector.

Economic disclosures

Smith (2008) argued that CSR has become a very important issue in the pharmaceutical industry in terms of what content-related information should be provided to the society regarding the offered products and services. In the same vein, Hikma Plc. is requiring all its staff to be properly trained and to follow standards set by upper management to promote sound social responsibility in the workplace as reflected in their mission statements. Typically, management at Hikma Plc. not only follow their legal obligations regarding business ethics, but they have also found that the obligations derived from responsibilities associated with the discovery, development, manufacturing, and marketing of medical supplies and services inherently involve questions of ethical dilemmas that must be answered. As an ultimate ethical concern, they regard those anticompetitive corporate practices undermines fair competition, inhibits economic development and is general bad for business and people. Hikma Plc. also has internal policies on anticompetitive behaviour. Suppression of antitrust activities and the promotion of fair competition laws help to maintain a competitive economy and that it is important to have free and open competition. Previous literature including (Battaglia et al. 2014; Castro, Guzman, and Serna 2015; Uchehara 2019) reported a positive linkage between firm CSR policy and competitiveness. Therefore, preventing corruption by following both national and international legislation initiatives and establishing its own internal policies designed to prevent corruption. Hikma Plc. has an internal audit system that was initially designed to enable management of the company identifying and dealing with infringements of these policies. Internal polices also allows them to appropriate disciplinary action against any employee or supplier that violates established corruption policy.

Environmental disclosures

Environmental responsibility is a crucial issue for Hikma Plc. trying to improve over time and has enacted ‘in process’ production processes that have enhanced environmental protection. Hikma Plc. goal is to produce products which will not harm humans, animals or the environment during production, use, or disposal. Hikma Plc. efforts in environmental protection were awarded by the granting of environmental certification of the company ISO 14001 in 2012 and ISO 9001 for the quality of management in recognition of its outstanding achievement in environmental protection and safety for chemical companies. The company participates in large-scale, global programs and in many localised programs to overcome their CSR strategies. Hikma Plc. has a strong corporate environment protection policy which heavily incorporates a philosophy of corporate social responsibility into their long-term objectives. Russell, Milne, and Dey (2017) argued that environmental accounting research overwhelmingly focuses on economic entities and their inputs and outputs. Hikma Plc’s. environmental policy supports initiatives that comply with environmental legislation in all the countries where it operates. Hikma Plc. goal was to reduce the impact of its polluting activities on climate change, gas emissions and to continuously improve its environmental protection efforts. The company renewed its accreditations at all production facilities worldwide. Carbon emissions were examined within the Carbon Disclosure Project (CDP) for improved operations. Results highlight Hikma Plc’s. environmental impact reporting and mitigation, waste recycling, water and energy saving and finally environmental certification of the company ISO 14001 in 2012 and ISO 9001 for the quality of management.

Social disclosures

The social pillar is of relatively great importance for Hikma Plc. management. Most importantly, Hikma Plc. appears to value its employees and preserve human rights. Since major pharmaceutical firms have many employees in many countries, their practices should be designed to promote the best ethical behaviours form its employees through a variety of incentive programs (Smith 2008). Hikma Plc. generally recruits and retains their employees by training, development, and a supportive work environment. Hikma Plc. believes in following the Universal Declaration of Human Rights and the core labour standards set out by the International Labour Organization. The company philosophy is to preserve human rights in all its locations. It refrains to work with any entity that neglects internationally accepted labour standards. To this regards, Hikma Plc. is committed to upholding the principles of Modern Slavery Act (2015), taking measures to ensure that modern slavery in the form of servitude, forced or compulsory labour and trafficking is not taking place in any part of Hikma Plc. business or in those of its partners or suppliers. The management team parallels governmental agencies contention that corporations have the right and responsibility to enforce standards for legal human rights. Hikma Plc. must control and supervise the safety of their products to protect the patient. In their stride for commitment to the ethical principles, several staff trainings, seminars on health, safety and environmental awareness were at the forefront of the company’s corporate governance principles. Proactively, Hikma Plc. has been differentiating itself from its competitors by strongly engaging in effective CSR strategy.

6. Conclusion

In this paper, we shed light on the CSR disclosure policy of Hikma Plc. The company was involved in economic, social care and environmental issues in its field of operations. Our research highlighted Hikma Plc.s’ CSR disclosures that comply with GRI 2016 standards. Results show that the company complies with greater extent to the international reporting standards under economic (GRI 200), social (GRI 300) and environmental (GRI 400) voluntary disclosures, even before 2016 (disclosure date of GRI standards). This was evidenced as their business continuously span across the continent of the world within the decades of establishment; that had witnessed several economic downturns. The continuous increase in shareholders returns and asset base implied that the company had maintained a better cash flow and supply chain. Our research suggests that CSR disclosure practices add value to the company beyond that is included in net income and other accounting data. Henceforth, companies cannot be measured on profits alone and the external environment plays a crucial role in the perceived value of an organisation. Mangers should consider CSR activities as an investment rather than additional expenses. Companies investing in sustainable projects should receive a social discount (Min et al. 2017). Although Hikma Plc showed a greater compliance with the social pillar of GRI standards in particular, greater enhancement of the company CSR disclosures should be done for the future both in the economic and environmental fields. If a pharmaceutical company wants to go on record as a contributor part of sustainable performance, it must define its corporate social responsibility strategy in a comprehensive and inspired way and therefore must transcend the ‘profit maximization’ dimension to apply the ambitious ‘good corporate citizenship’ player (Leisinger 2005). A multistakeholder approach allows for an exchange of resources, a combination of competencies, and the coordination of activity in a new way. Pharmaceutical companies can, for example, combine government’s ability to create a supporting environment, the ability of multilateral and bilateral donors to provide funds, and the private sector’s resources, which can make the necessary pharmaceutical goods and services available. Leisinger (2005) added that sustained corporate success depends also on the courage and imagination to respond to the needs and welfare of fair-minded stakeholders. A credible commitment to higher level corporate social responsibility will become one of the most important areas of future corporate leadership and success. Finally, The immense poverty-related health problems globally noticed and the failure of many developing countries in providing vaccine for their populations to fight the COVID-19 pandemic have become a challenging frame of reference for re-shaping a new corporate social responsibility vision for the pharmaceutical industry globally.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Mohamed Chakib Kolsi

Dr. Mohamed Chakib Kolsi is an associate professor of accounting at Emirates College of Technology, Abu Dhabi UAE and the University of Sfax Tunisia. He has more than 20 years teaching experience and he has published numerous research papers in higher ranked journals. His research field include corporate social responsibility, Islamic finance and corporate governance.

Mohammed Ananzeh

Dr. Mohammed Anenzah is an assistant professor and head of the management department at Emirates College of Technology, Abu Dhabi UAE. His research field include firm performance and innovation, CSR in healthcare sector

Alaeldin Awawdeh

Dr. Alaeldin Awawdeh is an assistant professor of management at Emirates College of Technology, Abu Dhabi UAE. He has several years teaching experience. His research interests include firm performance, e-business and total quality management.

Notes

1. We exclude the year 2010 from our analysis due to insufficient data for CSR disclosures by Hikma Plc.

2. https://www.iso.org/iso-14001-environmental-management.html

Appendix1.

Full Global Reporting Initiative GRI Standards

Table

Category	Code	Label
Economic standards	GRI 101	Foundation
	GRI 102	General disclosures
	GRI 103	Management approach
	GRI 201	Economic performance
	GRI 202	Market presence
	GRI 203	Indirect economic impact
	GRI 204	Procurement practices
	GRI 205	Anti-corruption
	GRI 206	Anti-competitive behaviour
	GRI 207	Tax
Environmental disclosures	GRI 301	Materials
	GRI 302	Energy
	GRI 303	Water and effluents
	GRI 304	Biodiversity
	GRI 305	Emissions
	GRI 306	Effluents and wastes
	GRI 307	Environmental compliance
	GRI 308	Supplier environmental assessment
Social standards	GRI 401	Employment
	GRI 402	Labour management relations
	GRI 403	Occupational health and safety
	GRI 404	Training and education
	GRI 405	Diversity and equal opportunity
	GRI 406	Non-discrimination
	GRI 407	Freedom of association and collective bargaining
	GRI 408	Child labour
	GRI 409	Forced or compulsory labour
	GRI 410	security-practices
	GRI 411	rights-of-indigenous-peoples
	GRI 412	human-rights-assessment
Social standards	GRI 413	local-communities
	GRI 414	supplier-social-assessment
	GRI 415	public-policy
	GRI 416	customer-health-and-safety
	GRI 417	marketing-and-labelling
	GRI 418	customer-privacy
	GRI 419	socioeconomic-compliance