The efficacy of sustainability reporting towards cost of debt and equity reduction

Shad, Muhammad Kashif; Lai, Fong–Woon; Shamim, Amjad; McShane, Michael K.

doi:10.1007/s11356-020-08398-9

Cited by 68 publications

(52 citation statements)

References 43 publications

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“…However, blue‐chip companies are seen to play a vital role in shaping the policies and attitudes in the fulfilment of companies' obligations towards economic, social, and environmental performance. Lastly, the stakeholder theory supports the engagement with stakeholder demands and commitment thereby contributing towards sustainability (Freudenreich et al, 2020; Jones et al, 2018; Shad et al, 2019, 2020).…”

Section: Prior Literature and Framework Developmentmentioning

confidence: 98%

Does adoption of ISO 56002‐2019 and green innovation reporting enhance the firm sustainable development goal performance? An emerging paradigm

2021

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Reporting is a means of communication for companies to their respective stakeholders. The literature on non‐financial reporting has mostly focused on operational, Carbon Discloser Project (CDP), and environmental disclosure to firm performance. This reporting and disclosure approach adopted by companies in their sustainability practices appears to be a normative approach. However, there has been a growing demand by stakeholders to incorporate proactive approach in business activities. To meet that, green innovation practices (GIPs) has been integrated as a new element in environmental reporting, thereby reflecting the proactiveness of companies in their adoption of green innovation reporting (GIR). The objective of this study is to advocate for greater disclosure on sustainability reporting by incorporating the GIPs of companies and substantial, sustainable development goal contribution, along with the moderation of the newly upgraded ISO 56002‐2019 innovation management system. Adoption of green innovation reporting and ISO 56002‐2019 will enhance the level of transparency of business activities and create greater stakeholder confidence along with enhancing the firm's sustainable development of goal performance. Furthermore, an extensive literature review was undertaken to create a GIR framework (i.e., product, process, service and technology) for firms to integrate GIPs into sustainability reporting. The conceptual model proposed the adoption of green innovation reporting and ISO 56002‐2019 innovation management system to firm sustainable development goal. This needs to be injected into the sustainable reporting of companies to reflect their innovativeness, actual sustainable business practices and sustainable development goal performance for the firm.

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Section: Prior Literature and Framework Developmentmentioning

confidence: 98%

Does adoption of ISO 56002‐2019 and green innovation reporting enhance the firm sustainable development goal performance? An emerging paradigm

2021

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“…Furthermore, the results showed that this reduction was more pronounced for companies with higher CSR scores, with longer CSR reports and that follow Global Reporting Initiative guidelines. Also Shad et al (2020) found that sustainability disclosure reduces the cost of debt. Furthermore, by analyzing the individual pillars, they found that the dissemination of information related to economic and environmental aspects has a negative effect on the cost of debt while they failed to find a significant relationship between social disclosure and the cost of debt.…”

Section: Literature Reviewmentioning

confidence: 99%

Extending the benefits of ESG disclosure: The effect on the cost of debt financing

Raimo

Caragnano

Zito

et al. 2021

Corp Soc Responsibility Env

290

129

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In recent years, greater attention has been paid to sustainability issues. Companies have received increasing pressure from stakeholders to adopt sustainable behavior and provide an adequate representation of sustainability practices. Nonfinancial disclosure has thus taken on a crucial role. In the academic field, several researchers have analyzed the effects of nonfinancial disclosure. However, limited attention has been paid to the impact of nonfinancial information on the cost of debt. This study aims at bridging this gap by analyzing the effect of ESG disclosure on the cost of debt. The fixed effects analysis conducted on a sample of 8264 observations (an unbalanced panel data of 919 firms for the period 2010-2019), shows a negative effect of the ESG disclosure on the cost of debt financing. The results demonstrate that companies with greater levels of transparency in the dissemination of ESG information benefit from accessing third party financial resources at better conditions.

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“…The pace of change continues to increase to pursue a sustainable model of capitalism. Pressures from the community for better corporate behaviour has also increased due to highly publicised corporate environmental disasters (Kamran et al 2021 ; Liu et al 2021 ; Roberts et al 2021a , 2021b ; Shad et al 2020 ). This trend has increased the demand for more environmental information and activities.…”

Section: Introductionmentioning

confidence: 99%

Sustainability assurance practices: a systematic review and future research agenda

Hazaea

Zhu

Khatib

et al. 2021

Environ Sci Pollut Res

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Although firms increasingly publish sustainability reports, assuring such reports is relatively new. This study reviews the literature of sustainability assurance to evaluate the intellectual development of the field and provide recommendations for future studies. It also demonstrates the role of assurance to enhance the credibility of sustainability reports and corporate reputation. This paper systematically reviews 94 papers obtained from the Scopus database between 1993 and August 2021. Our study shows that there is an increase in the number of studies published in recent years. We also found that some countries have received limited attention, such as the USA. The scant literature examining sustainability assurance in private institutions and non-profit organisations should be reinforced. Likewise, the sustainability research also provides limited evidence on the governance debate. The vast majority of research is not based on theoretical grounds. The need for assurance of sustainability reports not only enhances the reputation but also adds more value to the organisation’s planning, monitoring, and accountability. We highlight several new research suggestions that may enhance the understanding of sustainability assurance practices.

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The efficacy of sustainability reporting towards cost of debt and equity reduction

Cited by 68 publications

References 43 publications

Does adoption of ISO 56002‐2019 and green innovation reporting enhance the firm sustainable development goal performance? An emerging paradigm

Does adoption of ISO 56002‐2019 and green innovation reporting enhance the firm sustainable development goal performance? An emerging paradigm

Extending the benefits of ESG disclosure: The effect on the cost of debt financing

Sustainability assurance practices: a systematic review and future research agenda

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