Abstract
Annual reports are an important source of qualitative information about a company’s strategic areas, including sustainability. However, previous work on sustainability assessment has been limited to quantitative indicators that are difficult to obtain. Here, we address this issue by analyzing a company’s strategic documents, with the specific aim of demonstrating the role of sustainability and social responsibility in the text of the annual reports of companies in the IT services industry. We demonstrate that this information is a significant determinant of future economic outcomes. Specifically, here we evaluate sentiment in managerial communication in the area of sustainable business by using collocation analysis of topic and sentiment word lists. Several domain-specific word lists were used for each category monitored. Specifically, Loughran and McDonald’s word list was used to measure sentiment in the context of corporate social responsibility and sustainability. The word list that was developed by Pencle and Malaescu was used for CSR, while novel word lists are proposed for sustainability topics. The results of experiments show that the sentiment of sustainability topics (environmental and social in particular) in the annual reports may be a significant indicator of future profitability and thus represent an important information for corporate stakeholders.
Highlights
Increasing attention is being paid to the issues of sustainability and social responsibility
It can be seen from the results above that information on activities in the field of corporate social responsibility (CSR) are primarily included in the annual reports; CSR was presented with a negative overtone, which does not correspond with the assumption that including a presentation of sustainable development and especially CSR activities in annual reports would target a positive perception of the company by stakeholders
This study set out to determine the effect of CSR and corporate sustainability in the text of the annual reports of IT services companies on their profitability
Summary
Increasing attention is being paid to the issues of sustainability and social responsibility. A company’s competitiveness is linked to economic outcomes, and to how the company meets its stakeholders’ expectations as to the activities it develops for reasons of corporate social responsibility (CSR) and sustainable development [1,2,3]. Every company should inform their stakeholders in their annual report about what type of activities they are developing in order to make themselves sustainable and what results they have achieved in this respect. It can be seen from research in scientific literature that there are a number of academic studies dealing with CSR’s influence on companies’ economic outcomes [4,5,6]. This paper focuses on analyzing textual information that is contained in the annual reports of selected companies with the goal of determining to what extent and in which context do companies focusing on electronic business support present their activities concerning sustainability and social responsibility in their annual reports
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