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

Authors

  • W.A.P.L. Sandali Sri Lanka Institute of Information Technology, Sri Lanka
  • W.K.N.C. Gunathilake Sri Lanka Institute of Information Technology,Sri Lanka
  • M.G.C.D. Deshapriya Sri Lanka Institute of Information Technology, Sri Lanka
  • M.A.C. Nirman Sri Lanka Institute of Information Technology, Sri Lanka
  • A.A. Lokeshwara Sri Lanka Institute of Information Technology, Sri Lanka
  • R.S. Weerarathna Sri Lanka Institute of Information Technology, Sri Lanka

Abstract

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

Published

2021-09-23