Corporate sustainability reporting and the relations with evaluation and management frameworks: the Portuguese case

Abstract

This paper assesses how sustainability reporting practices have been adopted in organizations which operate in a Southern European country, Portugal, and how those practices are related with environmental management and evaluation systems. A questionnaire survey was carried out in 2006, involving a statistical population of 69 firms, specifically the member companies of the Business Council for Sustainable Development Portugal, the Portuguese branch of the World Business Council for Sustainable Development. The questionnaire survey was designed to assess: (i) the use of environmental management systems (EMS) and environmental performance evaluation (EPE) frameworks and (ii) practices connected with environmental and sustainability performance reporting, namely: report formats; regularity; key target audiences; reporting driving forces; guidelines; and future intentions. The results indicate that the environmental management system was a well-accepted environmental management tool. More than half of the companies surveyed had adopted environmental performance evaluation related frameworks. Corporate sustainability reporting was found to be a growing issue in a high number of organizations. Those companies that produce a sustainability/environmental report have an EMS and EPE in place. Most organizations in the study produced annual reports, in accordance with Global Reporting Initiative guidelines. Despite the increasing interest among organizations in the adoption of environmental and sustainability measurement and reporting practices, this issue was mainly confined to larger companies. The six Portuguese Small and Medium Enterprises analyzed show a poor environmental management and environmental performance evaluation and sustainability reporting profile. The findings show that they needed to be more engaged with these practices. Specific drivers must be used to enable these directions, including environmental education and raising awareness, since that is the first step toward improving the current scenario of reaching a better sustainable profile.