Global Reporting Initiative Framework Research Articles

The impact of ESG performance, reporting framework, and reporting assurance on the tone of ESG disclosures: Evidence from Chinese listed firms

This study explores the impact of Environmental, Social, and Governance (ESG) performance, Global Reporting Initiative (GRI) framework adoption, and ESG reporting assurance on the tone of ESG disclosures among Chinese listed firms. The research analyzes a dataset of 5985 observations from Chinese listed companies. It employs empirical methods to examine the relationships between ESG performance, GRI framework adoption, ESG reporting assurance, and ESG disclosure tone. The study finds a positive link between high ESG performance and a more optimistic ESG reporting tone, aligning with signalling theory. Conversely, adopting the GRI framework and ESG reporting assurance limits the use of positive tones, consistent with impression management principles. This underscores the importance of governance mechanisms in influencing responsible reporting and mitigating corporate hypocrisy. Additional tests affirm these findings, addressing potential endogeneity concerns. This study contributes to the existing literature on ESG reporting by providing empirical evidence on the influence of ESG performance and managerial tools on reporting tones. It establishes a positive link between ESG performance and ESG reporting tone and highlights the governance function of ESG reporting assurance and the GRI framework in curtailing managerial tendencies to manipulate tone. The paper bridges a research gap by responding to calls for more research into what drives the tone of ESG information. It cements the relevance of signalling theory in ESG and affirms that the deployment of GRI and ESG reporting assurance can serve as tools to inhibit impression management.

Regulatory influence, board characteristics and climate change disclosures: evidence from environmentally sensitive firms in developing economy context

Purpose This study aims to examine the impact of board characteristics on climate change disclosures (CCDs) in the context of an emerging economy, with a unique focus on regulatory influences. Design/methodology/approach This study analyzes longitudinal data (2014–2021) from environmentally sensitive firms listed on the Dhaka Stock Exchange, using a disclosure index developed within the Global Reporting Initiative framework. The authors use a neo-institutional theoretical lens to explore regulatory influences on CCD through board characteristics. This study uses hand-collected data from annual reports owing to the absence of an established database. Findings The results indicate that a larger board size, the presence of foreign directors and the existence of an audit committee correlate with higher levels of CCD disclosure. Conversely, a higher frequency of board meetings is associated with lower CCD disclosure levels. This study also observed an increase in CCD following the implementation of corporate governance guidelines by the Bangladesh Securities and Exchange Commission, albeit with a relatively low number of firms making these disclosures. Research limitations/implications This study contributes to the climate change reporting literature by providing empirical evidence of regulatory influences on CCD through board characteristics in an emerging economy. However, the findings may not be universally applicable, considering the study’s focus on Bangladeshi listed firms. Practical implications This study suggests growing pressures for diverse stakeholders, including researchers and regulatory bodies, to integrate climate change disclosure into routine activities. This study offers a valuable framework and insights for various stakeholders. Social implications By emphasizing the influence of good governance and sustainability practices, this study contributes to stakeholders’ understanding, aiming to contribute to a better world. Originality/value This study stands out by uniquely positioning itself in the climate change reporting literature, shedding light on regulatory influences on CCD through board characteristics in the context of an emerging economy.

Does Corporate Sustainability Reporting Influence Financial Performance? Evidence from Kenyan Listed Companies

Corporate sustainability reporting is currently a prominent issue in the global business world, with companies worldwide actively publishing sustainability reports to meet the demands of different stakeholders regarding social, environmental, economic, and governance concerns. The existing literature has proved that companies that participate aggressively in corporate sustainability reporting tend to have higher firm value, experience tremendous growth rates in terms of size and profitability, have a high capital and asset base, are lowly geared, and gain a competitive edge in the industry in which they operate. The study examines the link between corporate sustainability reporting and the financial performance of firms listed at the Nairobi Securities Exchange. Corporate governance, social, environmental, and economic pillars were used as indicators of corporate sustainability reporting. The Global Reporting Initiative framework will be employed to establish the corporate sustainability reporting scores and construct the sustainability reporting index. Financial performance was measured by return on assets. The study is anchored on the stakeholder theory supported by legitimacy and the tripled bottom-line theories. The target population comprises sixty-seven companies listed in Kenya. Secondary data was collected from the company integrated reports, published accounts, and the accounts filed with the Nairobi Securities Exchange for the period 2011 to 2020. The study adopted a cross-sectional correlational research design. Descriptive statistical tests carried out include mean, standard deviation, kurtosis and skewness. Correlation analysis was done to test and establish the direction of the relationship between the study variables. Regression analysis was employed to test the hypotheses of the study. Generally, the study findings are that corporate sustainability reporting had a significant positive effect on financial performance. The empirical results of this study showed that corporate sustainability reporting led to improved financial performance among listed companies, although sustainability reporting in Kenya was purely voluntary. Therefore, Kenya’s Capital Markets Authority should consider making corporate sustainability reporting compulsory for all listed companies. Further research can be extended to include non-listed companies and the application of other sustainability reporting frameworks. Keywords: Corporate Sustainability Reporting, Financial Performance, Global Reporting Initiative, Nairobi Securities Exchange.

A comparative study on sustainability standards with specific reference to GRI standards and BRSR framework

PurposeThe main objective of the study was to compare Business Responsibility and Sustainability Report (BRSR) norms with Global Reporting Initiative (GRI) standards, so as to establish whether BRSR norms match the global standards and best practices or not. Additionally, an effort was made to ascertain and highlight areas where BRSR norms are more comprehensive, just match, or require further refinement to be at par with the GRI standards. The study highlights the similarities and dissimilarities between the internationally accepted GRI standards and the BRSR framework; thereby suggesting areas of improvement for the BRSR framework.Design/methodology/approachScrutinised all the 36 standards of the Global reporting initiative and BRSR format and guidelines of the Securities Exchange Board of India. The Content Analysis Technique was used to ascertain the percentages of similarities between the two frameworks.FindingsThe content analysis found that there are 52.30% similarities between BRSR norms and GRI standards. Further, this study shows the factors that led to the dissimilarities between BRSR and GRI standards. This study found 18 areas where BRSR is more informative than GRI, and 7 areas where BRSR could be further refined.Originality/valueThis study contributes to research in the sustainability reporting framework to be adopted by Indian listed companies. There are a few Indian listed companies who are already reporting as per the GRI framework and might perceive the BRSR as a separate reporting altogether. But as found in this study, more than half of the BRSR framework is similar to the GRI framework; thus, half the work is almost done. As such this study helps Indian firms in developing an understanding of the BRSR and puts in perspective its standing among global sustainability reporting standards. This study shall help institutional investors, rating agencies, and external assurers to better visualize an Indian entity, by referring to its Business Responsibility and Sustainability Reporting.

Enhancing green total factor productivity through manufacturing output servitization: A case study in China

In the context of the growing environmental pollution and resource depletion caused by traditional manufacturing industries, the need for sustainable and eco-friendly practices has become a critical issue for the upgrading and transformation of the manufacturing industry worldwide. Based on data from listed manufacturing companies in China, which is the world's largest manufacturing country and exhibits significant diversity regarding the ownership, scale and level of enterprises, the impact of manufacturing output servitization on green total factor productivity (GTFP), which is a measurement of economic efficiency that takes into account environmental impacts, is analyzed in this article. The results show that manufacturing output servitization can improve the GTFP of enterprises, and this can be achieved through mechanisms such as increased profitability and innovation capabilities. The positive effect on the GTFP of enterprises in less developed regions is greater than that in developed regions and is more significant for private and foreign-funded enterprises than for state-owned enterprises. The companies that adhere to the Global Reporting Initiative framework for environmental, social and governance reporting experience a more significant positive impact on GTFP as a result of their manufacturing output servitization efforts. This research offers valuable insights into the potential of servitization as a strategy for enhancing GTFP and provides actionable guidance for policy-makers and industry stakeholders seeking to align manufacturing practices with sustainability goals.

Do shareholders appreciate the audit committee and auditor moderation? Evidence from sustainability reporting

PurposeThe purpose of this study is to investigate the association between sustainability reporting (SR) and firm value considering the moderating effect of audit committee (AC) quality and auditor tenure on this association.Design/methodology/approachThe data for the study comprise 41,500 firm-year observations worldwide between 2007 and 2018 drawing on ten main sectors. The authors run a country-industry-year fixed effect regression and address endogeneity concerns with further methodologies.FindingsFirst, the authors find that SR is significantly and positively associated with both firm value and industry-adjusted firm value. Further tests revealed that the baseline findings hold for SR assurance and the Global Reporting Initiative framework as well. Second, the moderation analysis outlined the significant moderating role that the AC assumes. More specifically, AC independence and expertise were found to strengthen the value relevance of SR. Third, the market also appreciates the moderation of auditor tenure in SR.Practical implicationsInvestors appreciate greater corporate transparency which means that sustainability reports are likely to reduce information asymmetry and thereby agency conflicts. In addition, the moderation analyses imply that shareholders consider AC quality while they attach value to corporate sustainability reports. Hence, the structure of the auditing function appears to perform an implicit assurance role in the value relevance of sustainability reports. In line with these implications, corporations can review and re-design their auditing function and decide whether or not they will attest to sustainability reports given that AC independence and expertise and auditor tenure predict this decision.Originality/valueThe study highlights the audit function’s growing role beyond financial reporting and suggests implications for ACs and auditors in ensuring shareholders about the credibility of SR.

A systematic review of the trends and patterns of sustainability reporting in universities

PurposeThis study aims to identify how literature has addressed sustainability reporting in universities over time and determine traceable patterns and trends.Design/methodology/approachA comprehensive systematic review protocol of the Emerald Insight, Web of Science, Science Direct, Scopus, Springer Link and Wiley Online Library databases was performed for the studies published during the past decade. The following steps were involved in this study: search and collection of literature, study selection, quality assessment, data extraction and data analysis. A total of 40 articles met the inclusion criteria and the quality assessment.FindingsThe results demonstrated that the most used tools to assist sustainability reporting in universities are the global reporting initiative framework and the graphical assessment of sustainability in universities. However, the adoption of the integrated reporting framework is encouraged. The level of reporting is not yet high, and social and educational indicators are being disclosed in the following areas: community, services and transfer; curriculum and teaching; operation; and research.Originality/valueThis study provides a recent overview of sustainability reporting worldwide. By discussing the findings, the authors presented the practical implications of starting a sustainability report at the university and the associated difficulties and benefits.

CSR reporting, assurance, and firm value and risk: The moderating effects of CSR committees and executive compensation

This study focuses on the value-generating and risk-reducing function of corporate social responsibility (CSR) reporting, assurance, and Global Reporting Initiative (GRI) adoption by considering the moderating effects of CSR committees and executive CSR compensation. We retrieved an international dataset of 58,105 firm-year observations from the Thomson Reuters Eikon database over a long period of 16 years between 2004 and 2019. We find that while CSR reporting and external assurance are positively associated with firm value and industry-adjusted firm value, they are negatively associated with firm value volatility (i.e., risk). However, even though following GRI guidelines is not associated with firm value or industry-adjusted firm value, it is negatively associated with firm risk. Moderation analysis reveals that while CSR committees help strengthen the relationship between CSR reporting and external assurance and firm value, they fail to moderate the relation between GRI framework adoption and firm value. Furthermore, there are no significant results on the moderating effect of executive CSR compensation on firm value in any of the model configurations. However, further tests show that executive CSR compensation has a positive moderating effect between CSR reporting and assurance and accounting performance. Robustness tests confirm that the findings are largely robust to alternative sampling, methodology, and additional control variables.

The impact of CEO age on a firm’s choice of global reporting initiative: moderating role of board social capital

PurposeThis study aims to explore the impact of the chief executive officer’s (CEO) age on adopting global reporting initiative (GRI) framework for corporate social responsibility (CSR) reporting. It also underlines how board social capital moderates the relationship between CEO age and the adoption of the GRI framework.Design/methodology/approachChinese A-listed companies during 2010–2018 were used. The authors applied a logistic regression model due to the binary nature of the dependent variable. For robustness, two-step generalized method of moments (GMM) and lagged independent variables are used.FindingsThe study finds that CEO age negatively impacts the firm’s choice of GRI reporting framework. The social capital of the board positively moderates this relationship. This finding is based on the notion that as a CEO grows older or headed toward retirement age, his/her interest in CSR diminishes due to a shorter career horizon. Boards with external links provide better advice on CSR issues and mitigate the negative impact of CEO age.Practical implicationsThe study results are important for understanding the GRI framework’s development and implementation, particularly in China.Originality/valueTo the best of the authors’ knowledge, this is the first study that deeply examines how CEO age affects GRI adoption in the Chinese context and how the board’s social capital moderates this relationship.

Corporate Governance and Corporate Social Responsibility Disclosures: Evidence from the Listed Companies in Sri Lanka

Purpose: The primary objective of this study is to investigate the nexus between corporate governance and corporate social responsibility disclosure in Sri Lankan listed firms.Design/Methodology/Approach: Corporate governance was evaluated using the following criteria: board size, board independence, role duality, women representation, audit committee size, and ownership concentration. The Global Reporting Initiative (GRI) methodology was utilized to assess Corporate Social Responsibility Disclosure (CSRD) using content analysis. This study collects balanced panel data from 44 Sri Lankan listed firms over a five-year period, from 2018 to 2022. Because of their highly regulated nature, the banking, finance, insurance, and investment trust industries were omitted from the sample. All of the information was gathered from yearly reports published on the Colombo Stock Exchange's website in Sri Lanka.Findings: Test results suggest that board size, independence, and women representation have no significant relationship with CSRD. Role Duality, Audit Committee Size and Ownership Concentration exhibit a significant association with CSRD. Moreover, the mean value of the CSRD is 44.56 percent for the selected listed companies in Sri Lanka.Originality: This study contributes to determining the extent to which companies have adhered to the GRI as a widely acknowledged disclosure framework. It provides value to the company's management in order for them to make better judgments on whether the firms should involve them in more corporate governance disclosures in order to raise the degree of CSR to enhance transparency and to promote stakeholders' well-being. The outcome also has ramifications for regulatory agencies in developing obligatory reporting requirements for all listed firms to comply with the GRI framework.

Sustainability reporting, universities and global reporting initiative applicability: a still open issue

PurposeThe porpose of this study is to critically consider the use of global reporting initiative (GRI) guidelines in universities’ sustainability reports.. In light of the recent literature and Habermas’s thinking, the study advances the research field by considering the process of internal colonisation from steering institutions and makes suggestions regarding the future role of GRI in the higher education (HE) context.Design/methodology/approachThis study presents a systematic literature review and content analysis for enhancing the critical reading of GRI applications in HE studies. The results are analysed in light of Habermas’s thinking, considering the GRI as a steering institution and its guidelines as steering mechanisms.FindingsThis study updates the literature review on sustainability reporting (SR) at universities and underlines the general trend in the employment of the GRI in this context. The results highlight the need to adapt the GRI to enhance its applicability in the HE context by considering additional dimensions such as research, teaching and operations. In doing so, the framework loses effectiveness and weakens the role of the GRI as a steering institution.Practical implicationsThe results suggest that the GRI guidelines should be reframed to enhance comparability among reports and increase its wider employment at universities.Social implicationsUniversities need to be guided in their accountability process towards SR by dedicated frameworks. This study suggests the potentially pivotal role that the GRI could play in providing dedicated tools for HE to steer and enhance the development of SRs at universities.Originality/valueThis study presents an updated review of studies on SR at universities and suggests possible paths for the future of the GRI framework applicability to universities’ SR.

Corporate Environmental Performance and Financial Performance: Evidence from the Most Polluting Companies in India

This article primarily investigates the association between corporate environmental performance (CEP) and financial performance (FP) of a firm and it also examines the effects of good, mixed, and poor environmental performers on FP. To achieve the objective, annual reports of 145 most polluting companies in India have been used from 2009–2010 to 2018–2019. On the basis of Global Reporting Initiative framework, the CEP scores have been measured in terms of quantitative (binary coding system) and qualitative (three-point scale) aspects using the content analysis technique. Subsequently, the scores are used to analyse the linkage between CEP disclosure and firms’ FP. Employing static and dynamic panel data analyses, the study observes quantitative as well as qualitative CEP performs significant part in expanding the firms’ market value and also notices innovation oriented investment boost the FP. On the contrary, the study finds out the expenditure on research and development and CEP together negatively influence firms’ FP. Further, it also reveals good performers make better CEP disclosure in their annual reports compared with mixed and poor performers on all aspects of environmental performance indicators of GRI guidelines and also observes a positive linkage between good performers and firm’s FP.

A new broom sweeps clean? Evidence from CEO tenure and global reporting initiative adoption in China

PurposeThis paper aims to explore the relation between chief executive officer (CEO) tenure and the propensity to adopt the global reporting initiative (GRI) for corporate social responsibility reporting in Chinese firms.Design/methodology/approachThis study used Chinese A-listed firms as sample during 2010–2020. Considering the binary nature of dependent variable, logistic regression model is applied. For robustness, lagged value of independent and control variables, additional control variables and two stage least square regression are used.FindingsThis paper finds that CEO tenure is negatively related to the adoption of GRI reporting standards. Furthermore, this paper finds that this association is less pronounced when CEOs are female and when CEOs have foreign experience. Furthermore, this paper finds that this association is not significant when CEOs are female and when CEOs have foreign experience. This paper also finds that the relationship between CEO tenure and GRI adoption is more pronounced in state-owned enterprises in China. The findings in this paper are robust after controlling for endogeneity.Practical implicationsThe study results are important for understanding the development and implementation of GRI framework especially in China.Originality/valueTo the best of the authors’ knowledge, this is the first study to deeply investigate how CEO tenure can affect adoption of GRI in Chinese firms.

Corporate social responsibility performance among listed non-financial firms in Nigeria

The extent of involvement in Corporate Social Responsibility (CSR) by companies in Nigeria is required in order to know the level of acceptance and actual performance of CSR demands on the companies. This descriptive research design study was carried out using data from the annual reports (2010-2019) of listed non-financial companies in Nigeria. Social and environmental disclosures based on the Global Reporting Initiative framework (GRI-4) were used. Social disclosure is measured as an index score generated from the score of 1 or 0 for disclosures or otherwise on community, donation, employee, health and safety, and customer/complaints. Environmental disclosure represents an index score generated from the score of 1 or 0 for disclosures or otherwise on material, energy, water, biodiversity, emission/greenhouse gas, waste management, product services, and compliance with laws. The companies are involved in activities that contribute more to social sustainability than environmental sustainability, accounting for an aggregate average performance score of 0.71 (71%) and 0.03 (3%) for social and environmental responsibility respectively. The firms contributed significantly to social responsibility and very little with no significant performance in environmental responsibility. The very low environmental responsibility performance among these firms is worrisome and calls for investigation into the existing national environmental regulatory frameworks.

Conformité des pratiques de reporting en matière de développement durable avec le cadre de la global reporting initiative : une analyse du secteur mondial de la santé

Sustainability reporting compliance with the Global Reporting Initiative framework: An analysis of the worldwide healthcare sector. Purpose : The purpose of the paper is to investigate the compliance with the GRI Framework of sustainability reporting practices in the worldwide healthcare sector. Design/methodology/approach : 2,440 sustainability reports published in 1999–2019 by 632 healthcare organisations worldwide were examined using a content analysis. A descriptive research methodology, including a literature review, was applied in order to address the stated purpose. Findings : The results indicate that (1) the growing tendency of healthcare organisations to publish sustainability reports in line with the GRI Guidelines or the GRI Standards is noticed every year; (2) 68% of all 2,440 reports published by healthcare services and products organisations comply with the GRI Framework. Noticed trends concerning sustainability reporting compliance with the GRI Framework might provide a complete picture of non-financial disclosure practices in the worldwide healthcare sector. The paper offers interesting insights on sustainability reports that are the most common instruments used by organisations to provide accountability about the economic, environmental and social performance. Originality/value : This research contributes to a growing literature on the standardization of sustainability reporting in the worldwide healthcare sector by providing an empirical view on the actual use of the GRI Framework. Research fills a research gap in the field of non-financial reporting practices of healthcare organisations from all over the world.

Can Global Reporting Initiative reports reveal companies’ green supply chain management practices?

Companies usually use Global Reporting Initiative (GRI) reports as a typical way to make their sustainability commitment transparent to stakeholders, without being concerned with making green supply chain management (GSCM) practices transparent. Given that the generic approach of the GRI framework makes it difficult to identify where and how GSCM practices are presented, this paper assumes that these GSCM practices are in the company's GRI reporting but are not transparent. Consequently, how GRI reports can reveal companies' GSCM practices remains underexplored in the literature. Guided by a qualitative approach, this study exploited data from the GRI reports of 30 Brazilian companies to verify the degree of GSCM transparency. Specifically, we use a theoretical structured framework for GSCM practices, consisting of four dimensions and 20 practices distributed among them. Our findings show that the current way of reporting actions to enhance companies' contribution to sustainable development can partially promote GSCM transparency. The findings also indicate which practices could be better documented in GRI reports to increase the visibility of GSCM actions, providing insights for managers and scholars seeking to define strategies to make GSCM more observable (e.g. total quality environmental management, environmental compliance and auditing programs, cooperation with suppliers, and scrap selling). Furthermore, the theoretical linkage between the GRI and GSCM contributes to theory by presenting a novel view of GSCM practices' transparency through the generic GRI guidelines.

Audit and CSR committees: are they complements or substitutes in CSR reporting, assurance and GRI framework adoption?

PurposeThis study aims mainly to test the effect of audit committee independence and expertise attributes on corporate social responsibility (CSR) reporting, assurance and global reporting initiative (GRI) framework adoption and to investigate how CSR committee existence moderates this main relationship.Design/methodology/approachThe study uses a large global sample that includes all (59,172) firm-year observations having CSR-related data in the Thomson Reuters Eikon database for a period between 2002 and 2019. The empirical analyses are based on random-effects logistic panel regression and Hayes methodology for the moderation analysis.FindingsThe study finds that audit committee independence and expertise are significantly associated with CSR reporting, CSR report assurance and GRI framework adoption. Moderation analysis largely supports the existence of a substitution role between audit and CSR committees and implies that audit committees are significant predictors of CSR reporting, assurance and GRI framework adoption mostly in the absence of the CSR committee.Practical implicationsThe findings propose audit committee members be extra-vigilant in CSR reporting and assurance practices arising from undertaking substitution roles with the CSR committee. Hence, firms may configure their corporate structure in line with the results such as augmenting the audit committee with independent and expert members if they do not constitute a CSR committee. If firms establish a CSR committee, audit committee members may allocate less time to CSR reporting and assurance and more time to financial reporting quality.Originality/valueThis is the first study, to the best of the authors’ knowledge, to investigate the direct and indirect effect of audit committees’ attributes not only on CSR disclosure but also on GRI implementation and CSR reporting external assurance, considering the CSR committee’s possible substitutability or complementarity moderating role. This research develops a deeper understanding of audit committees’ non-financial role.

Sustainability reporting in Vietnam: evolutionary or revolutionary? A case study of five public companies

This study explores corporate sustainability reporting in Vietnam, whether it is evolutionary or revolutionary. The study centers on answering the questions of the patterns of sustainability reports (SRs) and the level of conformity in the SRs of these companies to the Global Reporting Initiative (GRI) framework. Five big publicly listed companies in Vietnam have been selected for the case study. The content analysis method was applied for the data analysis. The findings indicate that four aspects are contributing to the evolution in sustainability reporting practices in those five companies. These include the nascent application of the GRI framework, the use of external assurance, the reporting models, and the incorporation of the United Nations Sustainable Development Goals into the reporting process.

How the Global Initiative Report's Indicators are Related to the Strong Sustainability Concept? - A Paraconsistent Approach

The pressure imposed by human-dominated systems on the natural environment and the search for more balanced social systems are current concerns worldwide. Among scales of attention and shared responsibilities, companies are also in the radar of and interested in to be more sustainable. An efficient way in disclosing information on companies' sustainability is through sustainability reports, such as the global reporting initiative (GRI) framework. Although recognized as an important alternative, the GRI is receiving criticisms about its ability in accurately express the meaning of sustainability. This work applies the paraconsistent annotated evidential logic (PAEL) on opinions of experts in the sustainability theme to verify whether the GRI indicators are aligned to the concept of `strong' sustainability. A survey applied to twenty-two experts from different field areas, backgrounds and work experiences on sustainability-related issues provided their beliefs and disbeliefs, in a quantitative way, about the ability of each of the 91 GRI indicators in expressing sustainability. Results show high dispersion (coefficient of variation $>$30%) among the experts opinions for 77 of the GRI indicators, in which the social category appears with the worst performance with its total 48 indicators with high dispersion. This is an indicative of different understandings by experts about the meaning of sustainability concept and/or the meaning and reach of GRI indicators in achieving sustainability. The PAEL reports that all three categories (economic, environmental and social) fall into the `paracomplete' region of the Cartesian unitary square's graph, indicating an inconclusive result about whether these three categories are able to capture and/or express the concept of strong sustainability. The overall performance (barycenter with beliefs of $\mu =0.26$ and disbeliefs of $\lambda =0.17$) also fall into the paracomplete region, rejecting the initial hypothesis that GRI may show strong sustainability. Recognizing the increasing importance of sustainability reports, this work contributes in identifying and suggesting improvements to the GRI developers on indicators that may better represent the strong sustainability and achieve its main goals. GRI's framework should be based on a clear sustainability model and provide through a simple, fast and understandable way, information about the purposes of each indicator. Focus for improvements should be especially directed to: EC4-6; EN18, 20, 21 and 34; LA2, 4, 5, 7, 8, 11, 12, 14; SO3-8, 11; PR1-5, 7-9; HR3, 8-10.

Challenges Faced in the Implementation of Sustainability Reporting: Empirical Evidence from Listed Companies in Sri Lanka

Sustainability reporting is a voluntary endeavor that involves publishing reports for reflecting the economic, social and environmental performance of an organization (Isenmann and Kim, 2006). When reporting sustainability practices, corporations encounter many challenges. The objective of the study was to discover the challenges faced by public listed companies in the implementation of sustainability reporting practices. Qualitative approach has been applied in gathering data and structured interviews were conducted among public listed companies who make sustainability disclosures aligning with the Global Reporting Initiative (GRI) framework. The study has been undertaken selected sectors in Colombo Stock Exchange (CSE) who reports sustainability against GRI framework. Researchers have conducted twelve (12) interviews with the responsible personal for sustainability reporting in each company. The data were analyzed utilizing Word Cloud software named as ‘Word It Out’. The findings revealed that gathering information on sustainability practices is a key challenge for most of the companies. Mainly, it was identified that additional resources and costs have to incur in facilitating the reporting purposes. Furthermore, identifying material topics, data accuracy, setting the optimal sustainability goals and measuring sustainability disclosures were also recognized as challenges faced by companies with regard to sustainability reporting. An independent assurance for sustainable reporting by an external auditor is the key overcoming method identified by the researchers as per the interviews. The main limitation was that we were unable to conduct interviews with all the sectors, which would not be adequate for giving an overall representation of sectors in the CSE. Therefore, it is recommended for the future researchers to take a bigger sample who make sustainability reporting according to the existing frameworks.
 Keywords: Sustainability Reporting, Global Reporting Initiative (GRI), Challenges