Decade of Sustainability Reporting in EU: Main Changes and Trends. Case of Companies Listed on NASDAQ OMX Baltic Main List
Recent decades have shown an increasing importance of sustainability reporting worldwide (Fernan-dez-Feijoo et al., 2014) and as a result significant developments of corporate sustainability reporting frameworks (Kücükgül et al, 2022). Nowadays the EU law requires certain large companies to disclose information regarding the way they operate and manage social and environmental challenges, (European Com-mission, 2021) thus making corporate sustainability reporting a powerful communication tool contributing to transparency and accountability of businesses. The main aim of this article is to investigate whether sustainability reporting has become a common practice among commercial organisations and find out the main features of the elements that are being disclosed.
This study fills a gap in determining the main changes and trends in sustainability reporting within Baltic countries. The main aim of this article is to determine whether sustainability reporting has become a common practice among commercial organisations and establish main trends and features of disclosed items. Main results of the study reveal that non-financial disclosures are being actively implemented by the companies who publish such disclosures in dedicated sections of annual financial reports. However, the number of standalone sustainability reports still remains low. It has also been established that the most common non-financial disclosures are: personnel related policies, client-oriented strategy, ISO certificates held by the respective organisations, EMAS registration, SDG and GRI referring. Authors believe that the main reason for slow growth of standalone sustainability reports is a lack of well-defined, universal, worldwide accepted standards.
The results of this research are completely in line with latest developments within the IASB, confirming that there is a definitive need for international sustainability reporting standards which will add to the transparency, credibility and comparability of non-financial reporting. These standards will provide companies with a new starting point in preparation of non-financial reports and make it easier for stakeholders to make decisions based on the information presented.
Authors believe that this survey would contribute to the current sustainability reporting practices among companies and serve as a basis for those searching for the optimal reporting tool. Also, it would shed light on the importance of implementing international sustainability reporting standards highlighting main obstacles, benefits and paths for future developments.
Keywords: Corporate Social Responsibility, ESG, EU Directive 2014/95EU, Non-financial Reporting, Sustainability Reporting, SDG.