Corporate Behavior: An Exploratory Study of the Brazilian Tax Management from a Corporate Social Responsibility Perspective

Abstract

A look into the literature on corporate social responsibility (CSR) reveals few studies focusing on the relationship between ethical concerns and corporate behavior of companies that perform tax evasion management. This study links tax management with ethics and CSR reporting. The purpose of this article is to analyze financial and social responsibility information disclosed by the five main Brazilian construction companies that are being investigated in Brazil’s Operation Car Wash (Operação Lava-Jato—in Portuguese) because of inappropriate behavior. Based on the theoretical concepts of organizational façades and organized hypocrisy, we used content-analysis methodology and lexical search approach to analyze the consistency between the practices of tax management and CSR reporting. The results reveal evidence of aggressive tax management. To meet its tax management objectives, a company usually manages and plans taxes accordingly, delaying the payment of tax debt and not reporting all tax risks, thus being fined for violations of the law. We found evidence of organized hypocrisy and organizational façades, since there are contradictions between the tax behavior of the investigated companies and their CSR and ethical discourse.