Facilitating accountability in corporate sustainability reporting through Spotlight Accounting

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Stephanie Perkiss ◽  
Leopold Bayerlein ◽  
Bonnie Amelia Dean
Keyword(s):  
Corporate Sustainability ◽  
Sustainability Reporting ◽  
Power Dynamics ◽  
Content Type ◽  
Decision Usefulness ◽  
Aggregate Analysis ◽  
Student Researchers ◽  
Practical Implications ◽  
Inform Decision Making ◽  
Engaging Student

PurposeIt is difficult for corporate sustainability reporting (CSR) to provide accountability to stakeholders. This paper assesses whether accountability-based CSR systems can be created through the application of Spotlight Accounting and WikiRate as a hybrid forum.Design/methodology/approachThe current paper explores the utility of Spotlight Accounting for CSR through assessing its application to a hybrid forum, WikiRate. This process involved engaging student researchers to collect CSR data from the United Nations Global Compact's (UNGC) corporate action group (CAG) and recording this information into the WikiRate platform. Aggregate analysis was conducted to assess the limitations and challenges of the data to inform decision-making.FindingsSpotlight Accounting exposes challenges within traditional applications of CSR. These challenges impact comparability, decision usefulness and accountability of CSR data for stakeholders.Practical implicationsThis paper provides recommendations to enhance the accessibility and relevance of company information to assist in the provision of Spotlight Accounting. In doing so, it highlights the usefulness of CSR to leverage greater accountability between corporations and society.Originality/valueThis paper applies the emerging practices of Spotlight Accounting and presents it as an alternative way to research and conceptualise external accounts, reporting and accountability. This form of accounting has the potential to enhance communications and partnerships between companies and society as well as challenge dominate power dynamics held by corporations.

scholarly journals Double materiality and the shift from non-financial to European sustainability reporting: review, outlook and implications

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Josef Baumüller ◽  
Karina Sopp
Keyword(s):  
Corporate Sustainability ◽  
Sustainability Reporting ◽  
Future Research ◽  
Content Type ◽  
Corporate Reporting ◽  
Stakeholder Groups ◽  
Reporting Requirements ◽  
Historic Development ◽  
Practical Implications ◽  
The Eu

PurposeThis paper outlines the development of the principle of materiality in the European accounting framework, from the Modernization Directive (2003/51/EC) to the NFI Directive (2014/95/EU) and on to the proposals for a Corporate Sustainability Reporting (CSR) Directive (2021/0104 (COD)). The authors highlight how the requirements for corporate reporting in terms of sustainability matters have changed, underlining the main issues that require further attention by practitioners, researchers and legislators.Design/methodology/approachThis paper is based upon a historic analysis of European Union (EU) regulations in the field of non-financial and sustainability reporting and how these have changed over time. A conceptual comparison of different reporting concepts is presented, and changes in their relevance to the EU accounting framework are discussed as part of the historic analysis. Implications from corporate practice are derived from previous empirical findings from the EU Commission's consultations.FindingsThe proposed change from non-financial to sustainability reporting within the EU affects more than simply the terminology used. It implies that a different understanding is needed of both the purposes of company reporting on sustainability matters and the aims of carrying out such reporting. This change was driven by the need and desire to appropriately interpret the principle of materiality set forth in the NFI Directive. However, the recent redefinition in the shift within the EU Commission's proposals presents considerable challenges–and costs–in practice.Research limitations/implicationsFuture research on the conceptualization and operationalization of ecological and social materiality, as well as on the use of this information by different stakeholder groups, is necessary in order to (a) help companies that are applying the reporting requirements in practice, (b) support the increased harmonization of the reports published by these companies and (c) fully assess the costs and benefits associated with the increase in reporting requirements for these companies.Practical implicationsCompanies have to establish relevant reporting processes, systems and formats to fulfil the increasing number of reporting requirements.Originality/valueThis paper outlines the historic development of the principle of materiality regarding mandatory non-financial or sustainability reporting within the EU. It outlines a shift in rationales and political priorities as well as in implications for European companies that need to fulfil the reporting requirements. In consequence, it describes appropriate interpretations of this principle of materiality under current and upcoming legislation, enabling users to apply this principle more effectively.

The moderating effect of environmental agencies on firms’ sustainability reporting in Nigeria

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Alhassan Haladu ◽  
Saeed Awadh Bin-Nashwan
Keyword(s):  
Environmental Policy ◽  
Social Issues ◽  
Developing Economies ◽  
Sustainability Reporting ◽  
Sustainable Growth ◽  
Sub Saharan Africa ◽  
Content Type ◽  
Environmental Agencies ◽  
The Relationship ◽  
Practical Implications

Purpose An attempt is made in this study aims to examine the extent to which the role of environmental agencies in Nigeria, i.e. DEPARTMENT for Petroleum Resources (DPR), National Environmental Standard and Regulatory Enforcement Agency (NESREA) and Nigerian Stock Exchange (NSE), influences firms’ attributes on sustainability reporting. Design/methodology/approach Both primary and secondary data covers 2015-2019 were used to collate information for the analyzes. The analysis was done using Stata 13 to determine the moderating impact of policy administrators on the relationship between corporate attributes and sustainability reporting. Findings The findings showed a very low level of sustainability reporting (27.53%), with a high significant level. Moreover, a positive and significant relationship exists between the major corporate attributes and sustainability reporting. A highly significant moderating impact of environmental policy administrators exists on these attributes, except for board size. Research limitations/implications The theoretical and practical implications of this study show that there is an indication of the inefficiency of the environmental policy administrators in Nigeria as the significance of the political economy theory as it affects the interactive impact on sustainability reporting. Further research is recommended on political-economic theory so as to know the economic implications of the effects of corporate attributes on environmental disclosure as it impacts governments and societies. Practical implications Results show that there is an indication of inefficiency by Nigeria’s main environmental policy administrators such as DPR, NESREA and NSE as it affects environmental, economic and social issues by listed firms. Originality/value This work emphasizes the moderating impact of environmental agencies on the relationship between firms’ characteristics and sustainability disclosure through the GRI4 framework standard. More so, it applied company attributes essential for a firm’s sustainable growth and development in the developing economies of sub-Saharan Africa.

Corporate sustainability reporting in Japanese multinational enterprises: a threat to local legitimacy or an opportunity lost for corporate sustainability practices?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Masayoshi Ike ◽  
Jerome Denis Donovan ◽  
Cheree Topple ◽  
Eryadi Kordi Masli
Keyword(s):  
Multinational Enterprises ◽  
Corporate Sustainability ◽  
Sustainability Reporting ◽  
Internal Communication ◽  
Structured Interviews ◽  
Host Countries ◽  
Content Type ◽  
The Sustainable Development ◽  
Novel Approach ◽  
Responsible Consumption

Purpose This paper aims to investigate whether Japanese manufacturing multinational enterprises (MNEs) maintain local legitimacy in their host countries through adequate informing of local stakeholders with targeted corporate sustainability (CS) reporting. Design/methodology/approach The paper first identified specific CS activities that were considered important in four Association of Southeast Asian Nations host countries, through semi-structured interviews with 58 participants of 16 Japanese manufacturing MNEs. The degree of establishment of local legitimacy was then measured through the number of references made to these CS activities and other activities specific to the respective host countries in the CS reports of the MNEs across a five-year period. Findings The majority of MNEs in the sample were under-reporting items of specific interest to localhost country stakeholders potentially undermining the MNEs’ image. There were found to be differences on the topics published in CS reports compared to those mentioned in the interviews indicating potential issues with regard to internal communication between the subsidiary and headquarters offices. Originality/value A novel approach is taken to investigate the degree of local legitimacy established by MNEs through comparing the contents of interviews held at subsidiaries with their respective CS reports. This paper highlights the importance of considering MNE subsidiaries when addressing Target 12.6 of the Sustainable Development Goal 12: responsible consumption and production.

Characteristics of UK higher education institutions that disclose sustainability reports

2018 ◽  
Vol 19 (7) ◽  
pp. 1279-1298 ◽  
Author(s):  
Remmer Sassen ◽  
Dominik Dienes ◽  
Johanna Wedemeier
Keyword(s):  
Higher Education ◽  
Higher Education Institutions ◽  
Research Question ◽  
Corporate Sustainability ◽  
Public Funding ◽  
Sustainability Reporting ◽  
Content Type ◽  
Sustainability Reports ◽  
The Uk ◽  
Uk Higher Education

Purpose This study aims to focus on the following research question: Which institutional characteristics are associated with sustainability reporting by UK higher education institutions? Design/methodology/approach To answer the aforementioned research question, this study uses logistic regression. Findings The results show that 17 per cent of the UK higher education institutions report on their sustainability (July 2014). In line with legitimacy and stakeholder theory, logistic regressions provide evidence that the larger the size of the institution, the higher the probability of reporting. By contrast, high public funding decreases this probability. Research limitations/implications The findings show characteristics of higher education institutions that support or hamper sustainability reporting. Overall, the findings imply a lack of institutionalisation of sustainability reporting among higher education institutions. Originality/value Although a lot of research has been done on corporate sustainability reporting, only a small number of studies have addressed the issues of sustainability reporting of higher education institutions. This study covers all sustainability reports disclosed among the 160 UK higher education institutions. It is the first study that investigates characteristics of higher education institutions that disclose a sustainability report.

Materiality disclosure in sustainability reporting: fostering stakeholder engagement

2018 ◽  
Vol 34 (5) ◽  
pp. 1-4 ◽  
Author(s):  
Sie Bing Ngu ◽  
Azlan Amran
Keyword(s):  
Stakeholder Engagement ◽  
Sustainability Reporting ◽  
Corporate Sector ◽  
Content Type ◽  
Corporate World ◽  
Reporting Process ◽  
Global Companies ◽  
Sustainability Reports ◽  
Practical Implications

Purpose This paper aims to illustrate that stakeholder engagement is a fundamental step of the sustainability reporting process, as it assists in defining the materiality and relevance of the information communicated and enhances greater transparency and greater accountability to stakeholders. Findings In today’s corporate world, the role of stakeholder engagement has been recognized as being significant in completing the process for materiality disclosure in sustainability reporting, and it has become one of the vital elements in advancing sustainable development in the corporate sector. The materiality approach has been recommended as the instrument for scoping and defining the content for sustainability reporting or reports that only disclose issues that are considered material from the perspective of the stakeholders. This is relevant to both businesses and stakeholders. Practical implications The paper provides strategic insights and practical thinking that have influenced some of the leading global companies in preparing their sustainability reports.

Blinded by the light? Analyzing sustainability authenticity, customer service perceptions, and halo effects

2019 ◽  
Vol 30 (1) ◽  
pp. 117-139 ◽  
Author(s):  
Clinton Amos ◽  
Sebastian Brockhaus ◽  
Amydee M. Fawcett ◽  
Stanley E. Fawcett ◽  
A. Michael Knemeyer
Keyword(s):  
Supply Chain ◽  
Customer Service ◽  
Design Methodology ◽  
Corporate Sustainability ◽  
A Priori ◽  
Decision Makers ◽  
Behavioral Experiments ◽  
Content Type ◽  
Sustainability Initiatives ◽  
Practical Implications

PurposeThe purpose of this paper is to evaluate how service perceptions influence customer views of the authenticity of corporate sustainability claims. The goal of this paper is to help supply chain decision-makers better understand boundary conditions in order to design more enduring and impactful sustainability programs.Design/methodology/approachThe authors employ behavioral experiments, subjecting two theoretically derived hypotheses to verification across five diverse industries and two distinct sustainability vignettes.FindingsCustomer service perceptions emerge as a significant boundary condition to the perceived authenticity of sustainability efforts. Subjects attributed significantly higher authenticity toward sustainability efforts in above average vs below average service quality contexts. Further, respondents attributed deceptive motivations to sustainability efforts at companies with below average service.Research limitations/implicationsThe authors confirm the underlying tenet of social judgment theory, which suggests thata prioriperceptions create a zone of acceptability or rejection. Ultimately, investing in sustainability can lead to counterproductive cynicism.Practical implicationsThe authors infer that customers’ willingness to give companies credit for sustainability initiatives extends beyond service issues to any practice that influencesa prioriperceptions. Supply chain managers must rethink their role in designing both customer service and sustainability systems to achieve positive returns from sustainability investments.Originality/valueThe authors challenge the assumption that customers universally positively view sustainability efforts. If customers holda priorinegative service perceptions, otherwise well-designed sustainability programs may invoke cynical reactions. Thus, sustainability programs may not inoculate firm reputations from adverse incidents. Given they touch both service and sustainability systems, supply chain managers are positioned to holistically influence their design for competitive advantage.

To disclose or not to disclose? Fashion brands' strategies for transparency in sustainability reporting

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Iva Jestratijevic ◽  
James Ohisei Uanhoro ◽  
Rachel Creighton
Keyword(s):  
Quantitative Study ◽  
Design Methodology ◽  
Secondary Data ◽  
Sustainability Reporting ◽  
Strategic Thinking ◽  
Fashion Industry ◽  
Content Type ◽  
Strategic Disclosure ◽  
Sustainability Disclosure ◽  
Practical Implications

PurposeThe purpose of this quantitative study is to identify disclosure strategies for transparency in sustainability reporting to support strategic thinking around transparency in the fashion industry. This research has two specific research objectives: to capture progress towards greater transparency across sustainability reporting areas, across fashion brands and years, and to identify strategic approaches for transparency in sustainability reporting by revealing common patterns in business disclosure.Design/methodology/approachThe authors cross-sectionally analyzed secondary data using four consecutive Fashion Transparency Indices (2017–2020). Brands' strategies for transparency in sustainability reporting were examined through the stakeholder theory lens.FindingsFindings confirm the presence of four approaches to disclosure: measurable, ambiguous, policy-only and secretive strategy. The disclosure was disproportionally distributed between 30% brands as transparency leaders and 70% brands as transparency laggards. The most transparent brands were not necessarily those rated highest by the index but those whose progress toward transparency was traceable over the years.Research limitations/implicationsThe study has overcome the limitation of the verifiability approach, supporting the requirement for diachronic and strategic disclosure assessments.Practical implicationsAs most brands hesitantly disclose sustainability information, stakeholders cannot know whether business policies equate to more than a corporate wish list. If there is no inspection for mandatory business disclosure, and if there is no penalty for disclosure violations, some fashion retailers will continue to generate profits while operating in an uncompliant and “opaque” manner.Originality/valueThe framing of disclosure strategies for transparency in sustainability reporting is the first scholarly effort to investigate diachronically sustainability disclosure among a big sample of major fashion brands.

Sustainability and financial performance relationship: international evidence

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ilker Yilmaz
Keyword(s):  
Financial Performance ◽  
Emerging Economies ◽  
Corporate Sustainability ◽  
Joint Effect ◽  
Business Practices ◽  
Content Type ◽  
Firm Financial Performance ◽  
International Evidence ◽  
The Relationship ◽  
Practical Implications

PurposeThe purpose of the article is to examine the relationship of corporate sustainability to firm financial performance by presenting international data.Design/methodology/approachThe sample includes non-financial companies from five emerging economies known as BRICS for a five-year period of 2014–2018. The study uses the ESG (environmental, social, governance) scores from Sustainalytics database and financial data from company reports. Panel regression models are developed to figure out the relationship.FindingsThe results of the article revealed that there is a positively significant relationship between sustainability performance and financial performance. Total ESG score has produced significant results while the individual scores of environmental, social, and governance have produced insignificant results; implying that the components of total ESG score have a joint effect on the financial performance.Practical implicationsThe results of the article have important practical implications for companies. Engagement in sustainable business practices will help improve the financial performance. In addition, the companies should be active in all components of sustainability.Originality/valueThe article contributed empirical evidence for sustainability-financial performance relationship by using the international evidence from five emerging economies.

Factors influencing corporate sustainability disclosure practices: empirical evidence from Indian National Stock Exchange

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Kishore Kumar ◽  
Ranjita Kumari ◽  
Archana Poonia ◽  
Rakesh Kumar
Keyword(s):  
Empirical Evidence ◽  
Information Disclosure ◽  
Corporate Sustainability ◽  
Sustainability Reporting ◽  
Free Cash Flow ◽  
Government Ownership ◽  
Content Type ◽  
Flow Capacity ◽  
Sustainability Disclosure ◽  
The Impact

Purpose This study aims to evaluate the nature and extent of sustainability disclosure practices of publicly listed companies in India. Further, it investigates the impact of potential determinants on the sustainability disclosure of companies. Design/methodology/approach The study analyzes data of 75 top listed nonbanking companies operating in India included in NIFTY100 Index for the years 2014-2015 to 2018-2019. In the present study, environment, social and governance disclosure dimensions were considered to evaluate the sustainability reporting performance of companies using content analysis. Panel data analysis was conducted to investigate the impact of various factors on the extent of sustainability information disclosure. Findings Results indicate that environmentally polluting industries disclose significantly higher sustainability information than non-polluting industries in India. The empirical findings suggest that determinants such as company size, age, free cash flow capacity, government ownership and global reporting initiative (GRI) usage positively related to the extent of corporate sustainability disclosure. Contrary to the expectations, financial leverage and profitability were found to be negatively related to the sustainability disclosure of companies in India. Practical implications This study provides empirical evidence for regulators, practitioners and corporate strategists to assess the progress in the sustainability reporting landscape in India. The finding implies that large and established companies can reduce legitimacy costs through higher sustainability information disclosure. Interestingly, this premise did not hold in the case of high leveraged and profitable companies. Overall findings can also help policymakers to incorporate necessary reforms to improve sustainability reporting in India. Originality/value This study is one of the first studies to investigate the nature, extent and potential determinants of corporate sustainability disclosure in India. The paper adds to the existing literature on sustainability reporting by providing empirical evidence on the relationship between sustainability reporting and potential determinants such as government ownership, size, leverage, profitability, age, free cash flow capacity, industry and GRI usage.

Consequences of corporate sustainability reporting: evidence from an emerging market

2020 ◽  
Vol 62 (3) ◽  
pp. 243-265
Author(s):  
RMNC Swarnapali
Keyword(s):  
Financial Reporting ◽  
Firm Value ◽  
Stock Exchange ◽  
Emerging Market ◽  
Earnings Quality ◽  
Corporate Sustainability ◽  
Market Value ◽  
Sustainability Reporting ◽  
Content Type ◽  
Sustainability Disclosure

Purpose The purpose of this paper is to discover whether corporate sustainability disclosure has a potential impact on the market value and earnings quality of firms in an emerging market. Design/methodology/approach The data were collected from 220 companies listed in the Colombo Stock Exchange (CSE) in Sri Lanka during the period 2012-2016. Firm value proxies by Tobin’s Q, while earnings quality proxies by discretionary accruals (DAC). The study is premised on value-enhancing theory for firm value and transparent financial reporting perspective for earnings quality. Regression analyses are executed on the panel data to achieve the study objectives. Findings The results reveal a positive relationship between sustainability reporting (SR) and firm market value, accepting the value-enhancing theory while rejecting the value-destroying theory. This finding suggests that investors pay a premium in the financial markets for firms that perform in an environmentally and socially responsible manner, compared to firms that do not perform in a similar manner. In the same vein, the results reveal that sustainability disclosure and DAC are negatively and significantly associated, resulting in high-quality earnings. The result is consistent with the transparent financial reporting hypothesis, which is also in line with the managers’ integrity motivation. Originality/value This is the first study investigating the consequences of SR that is specific to the Sri Lankan context. Owing to the sparse studies on consequences of SR, this study contributes significantly to the extant literature by broadening the geographical coverage to include a developing country setting.

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