The materiality assessment and stakeholder engagement: A content analysis of sustainability reports

Abstract

Materiality is the driver through which companies can select issues to be included in nonfinancial reports favouring the expectations of all stakeholders. The aim of this research is to investigate, under the lens of Stakeholder Theory and Instrumental Stakeholder Theory, the possible relationship between the application of the materiality principle in nonfinancial reports and the stakeholders' engagement processes, with a preliminary focus on different industries that are characterized by different types of stakeholder and on the application of Global Reporting Initiative and/or International Integrated Reporting Council guidelines promoting their direct involvement. A manual content analysis has been performed on the Italian “public interest entities” that published, for the 2017 year, a nonfinancial statement (Legislative Decree No 254/2016). The statistical analysis highlights the importance of industry, Global Reporting Initiative Standards application and stakeholder engagement in the reporting process, in particular in the materiality analysis, to achieve a high level of materiality application and good report quality for stakeholders.

Stakeholder engagement in sustainability reporting: A classification model

“…Sustainability reporting has become an important tool used by organizations to communicate their environmental, social, and governance performance to their stakeholders. The GRI guidelines have become the global standard and the most widely employed sustainability reporting tool, used by 82% of companies worldwide that complete stand‐alone CSR reports (Moratis & Brandt, 2017; Torelli et al, 2019; Kaur & Lodhia, 2019).…”

“…To develop a dialogue with different stakeholders' groups, companies worldwide have disseminated social and sustainability reports to communicate their corporate social responsibility practices (Campra, Esposito, & Lombardi, 2020; Hsu, Lee, & Chao, 2013). In addition to financial reports, which are a source of interest mainly to shareholders, sustainability reports communicate and disseminate information about corporate actions with respect to the interests of both stakeholders and society (Torelli, Balluchi, & Furlotti, 2019).…”

Sustainability Reporting Quality of Peruvian Listed Companies and the Impact of Regulatory Requirements of Sustainability Disclosures

“…There are some ex-ante studies, as the contributions of Venturelli and colleagues [81,82], as well as Carini and colleagues [83], that explored the potential impact of the EU Directive in Italy, and the researches of Ogrean [84], Szczepankiewicz and Mućko [85], and Dumitru and others [86] examined this same phenomenon in Poland and Romania. After the implementation of the Directive 2014/95/UE by the European country members and the consequent entry into force of obligatoriness, several ex-post studies focusing on sustainability reporting quality appeared; the countries addressed by these studies are mainly Spain [87], Italy [88], Germany [89][90][91][92], and Poland [93]. Outside the European continent, the empirical research is also growing, for example, there is empirical evidence from diverse countries as Australia [94], India [95], and Malaysia [96], and there are studies that applied comparative research designs to address several countries at the same time [73,97].…”

“…Inclusion of a materiality analysis in sustainability disclosure document [88,89,97,112,135,136]. To measure credibility, indicators related to the adoption of sustainability disclosure standards, disclosure assurance, reporting accuracy, materiality analysis, stakeholder dialogue, stakeholder engagement, top management disclosure, sustainability policy, and sustainability governance were considered.…”

Disclosure of eco‐innovation activities in European large companies' sustainability reporting

“…Narrative corporate communication was interrogated, its content extracted, analyzed and commented upon. We employ this method because it has been widely accepted methodological framework in studying and analyzing corporate sustainability and similar reports (Asif et al, 2013; Beck, Campbell, & Shrives, 2010; da Silva Monteiro & Aibar‐Guzmán, 2010; Daub, 2007; Guziana & Dobers, 2013; Landrum & Ohsowski, 2018; Roca & Searcy, 2012; Torelli, Balluchi, & Furlotti, 2020). The main data taken into consideration was any kind of information related to eco‐innovation activities communicated within the reports of the selected companies.…”