Voluntary Disclosure of Mission Statements in Corporate Annual Reports: Signaling What and To Whom?

Abstract

his paper examines the purpose of mission statements and discusses their intended audiences.The paper examines the theoretical rationale that leads to the disclosure of mission statements.Some writers have suggested that mission statements are mainly for internal use, 1 and this study explores that assertion by examining which constituencies are addressed by those who construct and disclose concise statements of mission or purpose.The disclosure, length, and components of mission statements are also examined.A number of disclosure vehicles are possible with respect to mission statements, but this study focuses on the annual report.The rest of this paper proceeds as follows.The concept of mission is discussed, followed by a consideration of the theoretical background to voluntary disclosure of mission statements.An adaptation of Clarkson's 2 model is proposed to assist in the inquiry and this is considered alongside signaling theory.The method is then described and results are presented and commented upon.

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