THE IMPACT OF SUSTAINABILITY REPORTING ON FINANCIAL PERFORMANCE OF SELECTED LISTED COMPANIES: EVIDENCE FROM INDIA

Abstract

At present, besides traditional disclosure practices, companies need to disclose all the relevant facts and figures relating to its contributions made towards the protection of environment and society. This type of reporting is popularly known as sustainability reporting. Sustainability reporting refers to the disclosure of information regarding the company’s operations in major areas i.e., economic, environmental, social and corporate governance. During the last couple of decades, sustainability reporting has received considerable attention throughout the world. In this context, it is pertinent to understand the present status of sustainability reporting practices of Indian companies and to examine the impact of sustainability reporting on financial performance of companies. This study is based on secondary data which are retrieved from various financial and non-financial reports of 25 selected Indian listed companies belonging to Automobile, Information Technology, Oil and Gas, Power and Cement industries covering the period from 2014-15 to 2021-22. This study used content analysis to understand the present status of sustainability reporting practices of Indian companies as per the Global Reporting Initiative (GRI) guidelines. This study applied correlation and panel regression analysis to examine the impact of sustainability reporting on financial performance of companies. It is found that sustainability reporting has a positive impact on financial performance of Indian companies.