Corporate sustainability reporting : an overview of the literature
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Date
2023-09
Authors
Ιωάννου, Παναγιώτης
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Abstract
The purpose of this dissertation is to provide valuable insights about Corporate
Sustainability reporting and its determinants, in a continuously rising research
field concerning companies, environment, society, investors, stakeholders,
shareholders, policy makers, regulators and academic researchers. We
searched for relevant studies, and we included 112 papers and other sources,
finding out that literature focuses on sustainability and corporate social
responsibility disclosures as well as firm sustainability and financial
performance. Initially, we present the evolution of the SR legislation and the
transition from single to double materiality principle in the EU and the shift
from a voluntary to mandatory approach for large firms and listed SMEs. The
crucial changes in the legal framework, the admission of SR being a global
concern, socially, environmentally and economically, so for governments, as
for the corporate world, are the key motivators of exploring this immensely
researched field, although still suffering from research gaps which we are
trying to cover. Proceeding to the following section, we discuss Corporate
Sustainability reporting tools, separated in frameworks, standards as well as
ratings and indices. Then, we analyze the determinants leading firms to
disclose ESG information and we notice that firm size, media visibility, and
ownership structure have the greater influence. Corporate governance impacts
firms only on the presence of sustainability or audit committees, while capital
structure, profitability, board composition and firm age do not have a clear
inclination. We also provide a comprehensive understanding in the field of firm
sustainability performance by presenting the way that factors such as board
size, board independence, CEO duality, number of women on the board, board
meetings, presence of CSR committee and firm attributes influence a firm’s
environmental, social and economic sustainability performance. Then, we
present the way that ESG performance impacts firm value and performance
through idiosyncratic and systematic risk transmission channels, pointing out
that a solid sustainability firm profile can lead to increased dividend payouts,
diminished danger of tail risk and an overall higher firm valuation. We could
potentially inspire future research and provide academic researchers,
companies, policymakers, and investors a deeper understanding of the
complexities associated with sustainability reporting and performance and
their impact on firm valuation and performance.
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Keywords
ESG reporting, Corporate sustainability reporting, Corporate social responsibility, Sustainability performance