Sustainability Reporting and its Impact on Corporate Financial Performance

Abstract

Sustainability has been assuming a key role into companies’ and society’s development as a consequence of worldwide economic and market situation: there is instability, caused by market vitality and dynamism, in particular after the recent financial crisis. This overall situation has increased the asymmetry between corporate disclosed information and stakeholders’ informational needs, which cannot be satisfied through the traditional financial statement. For these reasons, especially over the last decade, sustainability reporting has been adopting by more and more companies, also thanks to international organisation work such as the Global Reporting Initiative (GRI) that provides guidelines and standards for a common format of sustainability reporting. The practise to report the economic, social, environmental, and governance information can have a relation or impact on the corporate financial performance and enterprise value, perceived by stakeholders. In this dissertation, there is an in-depth analysis of sustainability concept, sustainability reporting, in particular related to GRI Guidelines, and an empirical analysis about the relationship between GRI sustainability indices and corporate financial data, utilising a sample of about 45 companies listed in Fortune 500.