Corporate Sustainability Reporting: What Makes A Good Quality Report?

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Home > Articles > Corporate Sustainability Reporting: What Makes A Good Quality Report?

 Corporate Sustainability Reporting: What Makes A Good Quality Report?

Paul Tiong Nyit Chiong | Today's Manager
December 2, 2019

Read on to better understand the reporting principles and qualitative characteristics of a good quality corporate sustainability report.

Corporate sustainability reporting is undertaken on a voluntary basis in many countries. However, an increasing number of companies worldwide, especially large multinationals, prepare sustainability reports. According to the KPMG (2017) 1 international survey of corporate responsibility reporting, 93 per cent of the top 250 companies listed on the Fortune Global 500 (G250) prepared sustainability reports compared to 92 per cent in the 2015 survey. The key drivers for reporting were regulation, stock exchanges, and investor pressure. In addition, the 2017 survey revealed that 67 per cent of the G250 companies sought external assurance of their sustainability reports versus 63 per cent in the 2015 survey.

In 2016, the Singapore Exchange (SGX) 2 introduced new listing rules on sustainability reporting for companies, which are applicable for the financial year ending on or after 31 December 2017, on a ‘comply or explain’ basis. Under rule 711A, every listed company must prepare a sustainability report no later than five months after the financial year end. Under rule 711B, the report must describe the company’s sustainability reporting practices relating to these components: (a) material environmental, social, and governance factors; (b) policies, practices, and performance; (c) targets; (d) sustainability reporting framework; and (e) board statement. If the company excludes any of these components, it must disclose the exclusion and explain what it does instead, and the reasons for doing so.

The KPMG (2017) 1 survey also found that the majority of companies surveyed used the Global Reporting Initiative’s Sustainability Reporting Guidelines (now called GRI Sustainability Reporting Standards or GRI standards for short) to prepare their reports. Seventy-five per cent of the G250 companies and 63 per cent of the 100 largest companies by revenue from 49 countries (N100) used the GRI guidelines. In the 2015 survey, 74 per cent of the G250 companies and 60 per cent of the N100 companies used the GRI guidelines.

A recent research study conducted by ASEAN CSR Network and NUS CGIO (2018) 3 on the corporate sustainability reporting practices of 678 SGX Mainboard and Catalist companies, as of 31 May 2018, found that there is significant room for improvement. Moreover, companies in high environmental and social impact sectors were found to disclose their sustainability performance poorly compared to companies in other sectors. Furthermore, only 15 companies obtained external assurance of their sustainability reports. Additionally, 61.5 per cent of the companies used recognised reporting frameworks such as the GRI standards, while the rest did not use one.

The objective of this article is to provide a summary of the main reporting principles and qualitative characteristics of a good quality corporate sustainability report. This is so that there is a common basis which companies could benchmark against to prepare good quality sustainability reports. The Global Reporting Initiative’s (2016) 4 GRI standards divide reporting principles into two groups: (1) Reporting principles for defining report content, which are sub-divided into: stakeholder inclusiveness, sustainability context, materiality, and completeness; and (2) Reporting principles for defining report quality, which are further divided into: accuracy, balance, clarity, comparability, reliability, and timeliness.

Zadek, Pruzan, and Evans (2003) 5 provide eight principles of report quality: inclusivity, comparability, completeness, evolution, management policies and systems, disclosure, externally verified, and continuous improvement.

There is an overlap of principles. These principles could be summarised as follows:

Stakeholder Inclusiveness
The organisation shall identify all its principal stakeholders (not only economically powerful stakeholders) and explain how it has responded to their expectations.

Sustainability Context
The organisation shall present its sustainability performance relative to sectoral, national, regional, or global sustainable development goals.

The organisation shall report its significant economic, environmental, and social impacts; or topics that substantively influence the stakeholders’ decisions, for example, future challenges for a sector identified by peers and competitors as well as legislations and agreements of strategic significance.

The report shall cover material topics and their significant economic, environmental, and social impacts sufficiently for stakeholders to assess the organisation’s performance during the period.

The information provided in the report shall be sufficiently accurate and detailed for stakeholders to assess the organisation’s performance.

The organisation shall report information that covers both positive and negative aspects of its performance.

The organisation shall make information which is understandable, easy, and economically accessible to stakeholders.

The organisation shall report information in a consistent format so that stakeholders are able to analyse changes in performance over time and with other organisations. This can be achieved by adopting a recognised reporting framework such as GRI standards.

The organisation shall collect, record, and report information in a way that can be subject to examination to establish the quality and materiality of the information reported. Organisations should develop clear sustainability accounting and reporting policies, systems and procedures which could be assessed through an audit. Corporate sustainability reports should be externally verified to strengthen organisational accountability and legitimacy.

The organisation shall report regularly so that information is available in time for stakeholders to make informed decisions. Corporate sustainability reporting should be a periodical (usually an annual) process that demonstrates how the company evolves over time in terms of organisational learning.

Continuous Improvement
The sustainability accounting and reporting system of organisations should enable sustainability performance benchmarks to be raised over time.

With the above checklist of reporting principles and qualitative characteristics of a good quality sustainability report, companies should be in a better position to judge the level of their reports.

1 KPMG, 2017, The KPMG survey of corporate responsibility reporting. Accessed via

2 Singapore Exchange, 2016, SGX-ST listing rules practice note 7.6 sustainability reporting guide. Accessed via

3 ASEAN CSR Network and NUS Centre for Governance, Institutions and Organisations, November 2018, Sustainability reporting in
Singapore. Accessed via

4 Global Reporting Initiative, 2016, GRI Standards. Accessed via

5 Zadek S, Pruzan P, and Evans R, 2003, How to do it, Chapter 3, in building corporate accountability: emerging practices in social and ethical accounting, auditing and reporting, Earthscan, London.

IMAGE: Shutterstock

​Dr Paul N C Tiong is a Senior Lecturer in the Academic Division of SIM Global Education. He teaches accounting in the University of London programmes. Dr Tiong holds a PhD in accounting and is a CA/CPA. His research interest is in corporate sustainability reporting and he has written refereed and professional journal articles on this topic.


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