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Article
| European Business Review
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September – October 2011
The Rise and Consequences of Corporate Sustainability Reporting
by
Ioannis Ioannou and George Serafeim
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Abstract
For many decades the cornerstone of corporate reporting has been financial information that is presented in a company's annual, semi-annual, and quarterly reports. These comprehensive financial reports—required by law for public companies in most countries worldwide—have provided shareholders as well as other interested stakeholders with rather elaborate information on the company's operations and strategic activities during the preceding fiscal year. However, in the last two decades and in addition to these financial reports, a growing number of companies across sectors and geographies are communicating to their stakeholders their initiatives and performance within the environmental, social, and governance (ESG) domains. Disclosure of non-financial reports has generated heated debates about whether such information is useful for stakeholders, whether disclosure along ESG dimensions should be mandated by regulation, and if yes, what form such regulation should take. The underlying debate, of course, relates to the broader issue of the role of the business organization within civil society and whether it may contribute toward the world's acute problems via some form of corporate social responsibility (CSR) through a sustainable business model that also generates superior financial performance.
Keywords: Governing Rules, Regulations, and Reforms;
Annual Reports;
Operations;
Strategy;
Business and Shareholder Relations;
Business and Stakeholder Relations;
Performance;
Geography;
Civil Society or Community;
Business Model;
Corporate Social Responsibility and Impact;
Corporate Disclosure;
