No. 184: Social Sustainability Standards Revisited

Jahr: 2023
Typ: Working Paper

Abstract

In an empirical study, we examine the interplay of firms‘ performance in social sustainability, mandatory disclosures of social sustainability, firms‘ financial performance, and informativeness of social sustainability indicators. We use data from Refinitiv and the exogenous change in the regulatory environment (Directive 2014/95/EU in 2014 and its implementations in EU countries) to investigate whether mandatory disclosures of social sustainability lead to better social performance and if social performance is related to firm performance. Moreover, we match the social sustainability metrics disclosed by firms with the exposure drafts for sustainability disclosure standards by the European Financial Reporting Advisory Group (EFRAG) to identify whether the metrics that will most probably become part of future regulation for mandatory disclosures are also informative with respect to financial performance. We find that mandatory disclosure requirements increase social performance and that social and financial performance are positively linked. Moreover, we find that several metrics included in the exposure drafts for sustainability disclosure standards are not informative with respect to financial performance, whereas other metrics that are currently not included in the standards are highly informative. Our results have important implications for firms‘ disclosure strategies as well as for regulators and standard-setters regarding the implementation of disclosure standards on sustainability issues.

 

Beteiligte Institutionen

Die Hauptstandorte vom TRR 266 sind die Universität Paderborn (Sprecherhochschule), die HU Berlin und die Universität Mannheim. Alle drei Standorte sind seit vielen Jahren Zentren für Rechnungswesen- und Steuerforschung. Hinzu kommen Wissenschaftler der LMU München, der Frankfurt School of Finance and Management, der Goethe-Universität Frankfurt, der Universität zu Köln und der Leibniz Universität Hannover, die die gleiche Forschungsagenda verfolgen.