Sustainability Reporting in the Nordic Real Estate Companies: Empirical Evidence From Finland

Abstract

The purpose of our study was to investigate the content of sustainability reporting issued by real estate sector. Content analysis was employed to identify the strengths and weaknesses of sustainability information provided by sample companies. The content analysis structure considered both quantity and quality of information simultaneously. Our results show an inconsistency in the form, extent and quality of sustainability reports. In addition, our findings recognise a lack of clear approach to embrace materiality, external assurance, and further engagement of stakeholders in the sample reports. It seems that most of the sample companies were engaged in issuing sustainability reports to fulfil the legislative requirement and avoiding financial or legal risks. Our study provides information on the current status of sustainability reporting to real estate professionals. In addition it contributes in decreasing the financial and legal risks, and increasing the corporate reputational capital, by revealing the common weaknesses prevalent in the sustainability reports.

The Involvement of Real Estate Companies in Sustainable Development—An Analysis from the SDGs Reporting Perspective

“…Due to the voluntary nature of sustainability performance reporting, real estate companies are facing a lack of a standardised approach of the informational content of sustainability reports [11]. To eliminate this problem of real estate reporting, bodies such as the Carbon Disclosure Project (CDP), European Association for Investors in Non-Listed Real Estate Vehicles (INREV), European Public Real Estate Association (EPRA), Global Reporting Initiative (GRI) and Global Real Estate Sustainability Benchmark (GRESB) propose standardised but voluntary frameworks for presenting sustainability information.…”

“…Increased European policies on sustainability explain the increase in the number of real estate companies that engage in sustainability practices [11]. In general, researchers believe that businesses operating in industries heavily impacted by sustainability regulations are more involved in the CSR reporting [30].…”

“…Because of the major impact of buildings on the environment (the real estate sector consumes over 40% of the global energy annually, 30% of the raw materials and 12% of the drinking water, generating 25%-40% of the solid waste and 20% of the total gas emissions), the environmental objectives have been included as a priority in the strategies of several European real estate companies [9,10]. However, further efforts are needed to reach the United Nations (UN) targets on climate change, as the real estate sector is outperformed by other economic sectors in managing environmental sustainability challenges [11,12]. In addition, the real estate industry is recognised for its slow response and reduced contribution to sustainable development [13,14].…”

Social sustainability tool for assessing land use planning processes

“…Figures 2 and 3 present the detailed description of the types of information related to economic, environmental and social responsibility themes. Percentage of information types provided for each theme (Rashidfarokhi et al, 2018a).…”

“…The distribution of sustainability information under defined information types(Rashidfarokhi et al, 2018a).…”