Factors Influencing Sustainability Reporting: Evidence from Turkey

Abstract

Sustainability reporting has become a mainstream practice for companies around the world in recent years. Companies release sustainability reports to provide information on non-financial aspects of their performance, in addition to financial aspects. The purpose of this research is to investigate the sustainability reporting practices of Turkish non-financial companies listed on Borsa Istanbul (BIST) during the years 2004 to 2015. This paper also aims to examine the factors that influenced the decisions to publish sustainability reports. The findings of the research indicate that a growing number of companies publish stand-alone sustainability reports, ranging from 1 report in 2004 to 27 reports in 2015. This finding implies that companies in Turkey are becoming increasingly aware of sustainability reporting. However, the percentage of companies which did not produce a separate sustainability is still relatively high. The results also indicated that the most common framework for sustainability reporting is the Global Reporting Initiative (GRI). The findings revealed that listing on the Corporate Governance Index (CGI), having a sustainability committee, the type of industry, the size of the company and profitability are significant determinants of stand-alone sustainability reporting, whereas leverage is not. This research contributes to the literature by investigating the sustainability reporting practices of companies using longitudinal data from Turkey. This study also adds to the literature by examining the factors impacting sustainability reporting.