Sustainability reporting in corporations: A comparative review of practices in the USA and Europe
1 Havenhill Synergy Limited, Nigeria.
2 Shell Nigeria Plc, Nigeria.
Review Article
GSC Advanced Research and Reviews, 2024, 18(02), 204–214.
Article DOI: 10.30574/gscarr.2024.18.2.061
Publication history:
Received on 31 December 2023; revised on 08 February 2024; accepted on 10 February 2024
Abstract:
As global awareness of environmental, social, and governance (ESG) issues intensifies, corporations are increasingly recognizing the importance of sustainability reporting in demonstrating their commitment to responsible business practices. This Review provides a comparative review of sustainability reporting practices in corporations, focusing on the distinctions between the USA and Europe. The USA and Europe, as major economic regions, exhibit distinct approaches to sustainability reporting, reflecting diverse regulatory frameworks, cultural considerations, and stakeholder expectations. This review delves into the key elements characterizing sustainability reporting in both regions, highlighting the convergences and divergences that shape corporate disclosure practices. In the USA, sustainability reporting is predominantly driven by voluntary initiatives and market forces. Companies often engage in ESG reporting to meet the expectations of investors, consumers, and other stakeholders who increasingly prioritize sustainable business practices. The absence of a standardized regulatory framework has led to a heterogeneous landscape of reporting methodologies, with some corporations adhering to global standards like the Global Reporting Initiative (GRI) or adopting industry-specific frameworks. In contrast, Europe has witnessed a more structured and regulatory-driven approach to sustainability reporting. The European Union (EU) has been at the forefront of shaping sustainable finance policies, introducing frameworks such as the Non-Financial Reporting Directive (NFRD) that mandate certain companies to disclose non-financial information. European corporations, therefore, navigate a more standardized reporting landscape, aligning with established frameworks like the EU Taxonomy Regulation and the Task Force on Climate-related Financial Disclosures (TCFD) recommendations. This comparative analysis explores the motivations behind sustainability reporting, the disclosure frameworks commonly employed, and the impact of regional regulatory contexts on corporate practices. By shedding light on the unique dynamics in the USA and Europe, this review contributes to a nuanced understanding of how corporations navigate the evolving landscape of sustainability reporting, ultimately fostering transparency, accountability, and responsible corporate citizenship.
Keywords:
Sustainability; Corporations; Practices; Reporting; Comparative
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Copyright © 2024 Author(s) retain the copyright of this article. This article is published under the terms of the Creative Commons Attribution Liscense 4.0
