Drivers of Corporate Reporting on Sustainable Development Goals

Abstract

This study explores country-level traits, firm and report variables as key drivers of Sustainable Development Goals (SDGs) disclosure practices. Our analysis is motivated by the more fundamental role of businesses in the new United Nations SDG’s framework. Using advanced textual methods, we build a dataset of 4,200 reports from 2,524 firms in 59 countries for the period 2015-2017 to measure both SDGs awareness and disclosure quality. Drawing on institutional theory, we find that size, leverage, firm age, analyst coverage and the presence of CSR committees are important determinants for the early adoption of SDGs. Our empirical findings also unveil country-specific cultural effects on SDGs disclosure: masculinity, individualism and long term orientation are dominant characteristics in explaining variations of SDGs disclosure. Interestingly, when it comes to the 17 individual goals and cluster of goals according to “planet, people and prosperity”, we find diversified cultural effects on firms SDG reporting strategy.