Sustainability Reporting Transparency among Front-runners of the Practice: An embedded single case study from the Finnish forest, paper, and pulp industry

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School of Business | Master's thesis

Date

2020

Major/Subject

Mcode

Degree programme

Management and International Business (MIB)

Language

en

Pages

204

Series

Abstract

Amid grave social problems such as global warming and biodiversity loss, sustainability reporting has emerged as a central medium for companies to engage and communicate with their stakeholders on such concerns and how they strive to act responsibly. However, in the academic literature there is a debate on the outright usefulness of sustainability reporting as a practice that seems to boil down to questions over how voluntary this reporting should be. Is sustainability reporting an effective tool to aid sustainable development or a mere PR stunt for companies to maintain legitimacy in an era of corporate distrust? The thesis proposes transparency to be a key determinant of sustainability reporting quality and usefulness. By examining front-runners of sustainability reporting in an industry intimately tied to both global warming and biodiversity, the thesis hopes to explore and describe the prevalent level of sustainability reporting transparency via an embedded single case study from the Finnish forest, paper and pulp industry. This study has examined three case companies to answer research questions regarding what is the current level of sustainability reporting transparency among the front-runners of sustainability reporting on their environmental impacts, how companies approach the disclosure of negative environmental information in relation to their operations, and how comparable the disclosed information is between the sustainability reports of companies from the same industry, with similar geographical operating areas and the same sustainability reporting guideline. To explore and describe prevalent sustainability reporting transparency on environmental impacts, the thesis has devised and implemented a theoretical framework based on previous research to approach the research questions from the point of view of five research variables: stakeholder inclusiveness, balance of information, reporting boundaries, internal organizational factors, and comparability.The empirical data consists of sustainability reports, which have been analyzed using the study’s theoretical framework to utilize a theory-driven thematic analysis method. The findings point to a considerable lack of transparency that still permeates the sustainability reporting practice with regards to companies’ environmental impacts and performance, even among the front-runners of sustainability reporting. Disclosing negative information appears to be particularly challenging for companies and the comparability of the disclosed information between the sustainability reports can be described as limited due to variations in disclosure methods. The findings could be seen to hold implications for both the reporting practice and practitioners as well as various stakeholder groups, such investors, regulators, and consumers.

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Thesis advisor

Moisander, Johanna

Keywords

sustainability reporting, transparency, environmental accounting, corporate social responsibility, CSR, Finland

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