Sustainability reporting beyond the business case and its impact on sustainability performance: UK evidence

Habiba Al-Shaer; Khaled Hussainey

doi:10.1016/j.jenvman.2022.114883

Sustainability reporting beyond the business case and its impact on sustainability performance: UK evidence

J Environ Manage. 2022 Mar 11:311:114883. doi: 10.1016/j.jenvman.2022.114883. Online ahead of print.

Authors

Habiba Al-Shaer¹, Khaled Hussainey²

Affiliations

¹ Newcastle University, Business School, 5 Barrack Road, Newcastle Upon Tyne, NE1 4SE, UK. Electronic address: habiba.al-shaer@newcastle.ac.uk.
² Portsmouth Business School, University of Portsmouth, Portland Street, Portsmouth, PO1 3DE, UK. Electronic address: khaled.hussainey@port.ac.uk.

PMID: 35287071
DOI: 10.1016/j.jenvman.2022.114883

Abstract

We explore Landrum and Ohsowski (2018)'s development model, which positions each company's sustainability reporting with multiple worldviews of corporate sustainability. We investigate the impact of sustainability report communicative actions on corporate sustainability performance. We argue that companies that comply with the reporting guidelines and adopt the business case for corporate sustainability may not capture all sustainability aspects, and therefore may not have a real impact on sustainability performance. Employing a computer-based textual analysis on a sample of UK firms that published sustainability reports during the period 2014-2018, we find that sustainability reports that communicate the message that firms understand sustainability to mean maintaining production and consumption patterns within resources capacity of the planet and coexisting in harmony with nature are likely to have a positive effect on sustainability performance. On the other hand, communicating compliance and the business-centred approach as their understanding of sustainability will negatively affect sustainability performance. Our findings offer important implications for companies who need to change their approach towards sustainability reporting and shift from the business case approach to advance to the next stage of sustainability reporting which should guide corporate decisions and actions.

Keywords: Corporate sustainability worldviews; Sustainability performance; Sustainability reports; Textual analysis.