Why ‘Less is More’ in non-Financial Reporting Initiatives: Concrete Steps Towards Supporting Sustainability

Forthcoming issue of Accounting Economics and Law journal.

University of Oslo Faculty of Law Research Paper No. 2020-15

32 Pages Posted: 11 Jun 2020

See all articles by Georgina Tsagas

Georgina Tsagas

Chartered Institute of Arbitrators UK

Charlotte Villiers

University of Bristol

Date Written: June 10, 2020


Calls are repeatedly made on corporations to respond to the challenges facing the planet from a sustainable development perspective and governments take solace in the idea that corporations’ transparency on their corporate activity in relation to sustainability through voluntary reporting is adequately addressing the problem. In practice, however, reporting is failing to deliver truly sustainable results. The article considers the following questions: how does the varied reporting landscape in the field of non-financial reporting impede the objectives of fostering corporations’ sustainable practices and which initiative, among the options available, may best meet the sustainability objectives after a decluttering of the landscape takes place?

The article argues that the varied corporate reporting landscape constitutes a key obstacle to fostering sustainable corporate behaviour, insofar as the flexible and please all approach followed in the context of corporate sustainability reporting offers little to no real incentive to companies to behave more sustainably and ultimately pleases none in the long run. The case made is that ‘less is more’ in non-financial reporting initiatives and hence the article calls for a revision of key aspects of the European Non-Financial Reporting Directive, which, as is argued, is more likely to achieve the furtherance of sustainable corporate behaviour. Although the different reporting requirements offer the benefits of focusing on different corporate goals and activities, targeting different audiences and allowing for a level of flexibility that respects the individual risks to sustainability associated with each industry, the end result is a landscape that lacks overall consistency and comparability of measurements and accountabilities, making accountability more, rather than less, difficult to achieve.

The article acknowledges the existence of several variances relating to the notion of sustainability per se, which continues to remain a contested concept and variances between companies and industries in relation to how each is operating sustainably or unsustainably respectively. Such variances have so far inhibited the legislator from easily outlining through tailored legislation the individual risks to global sustainability in an all-encompassing manner. The end product is a chaotic system of financial reporting, CSR reporting, non-financial reporting and integrated reporting and little progress to increase comparability and credibility in order for companies to be held accountable and to behave in ways that do not harm the planet. A ‘clean up’ of the varied initiatives in the terrain of non-financial reporting is recommended.

Keywords: reporting; non-financial; sustainability; accounting; European Non-Financial Reporting Directive; integrated reporting

Suggested Citation

Tsagas, Georgina and Villiers, Charlotte Louise, Why ‘Less is More’ in non-Financial Reporting Initiatives: Concrete Steps Towards Supporting Sustainability (June 10, 2020). Forthcoming issue of Accounting Economics and Law journal., University of Oslo Faculty of Law Research Paper No. 2020-15, Available at SSRN: https://ssrn.com/abstract=3623889

Georgina Tsagas (Contact Author)

Chartered Institute of Arbitrators UK ( email )

12 Bloomsberry Square, London
United Kingdom

Charlotte Louise Villiers

University of Bristol ( email )

University of Bristol,
Senate House, Tyndall Avenue
Bristol, Avon BS8 ITH
United Kingdom

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