IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i4p1619-d1592088.html
   My bibliography  Save this article

The Interconnection of Double Materiality Assessment, Circularity Practices Disclosure and Business Development in the Fast Fashion Industry

Author

Listed:
  • Victoria Bogdan

    (Department of Finance & Accounting, Faculty of Economic Sciences, University of Oradea, 410087 Oradea, Romania)

  • Luminița Rus

    (Department of Finance & Accounting, Faculty of Economic Sciences, University of Oradea, 410087 Oradea, Romania)

  • Diana Elisabeta Matica

    (Department of Finance & Accounting, Faculty of Economic Sciences, University of Oradea, 410087 Oradea, Romania)

Abstract

This qualitative study aimed to explore double materiality reporting practices and their impact and financial materiality relevance as well as the disclosure of circularity practices in connection with financial and ESG reporting in the fast fashion industry. Thematic deductive content analysis (TDCA) was performed in five steps on sustainability reports of iconic fast fashion companies, with the aim of identifying recurring disclosure themes and patterns with the help of the NVivo 14 software. The results reveal that strongly addressed topics in the reporting of double materiality are the sustainable and environmentally friendly use of resources and involvement in the community, while the least addressed is employee wellbeing. A strong positive association between double materiality assessment and resource efficiency was found, proving that the efficient use of resources significantly improves environmental performance. Also, circularity innovation shows high correlations with the assessment of environmental impact materiality and governance, highlighting the role of innovation in enhancing overall sustainability. Integrating circular practices into corporate strategies shows that companies performing very well in circularity are most likely to have higher ESG performance in the future. The integrated approach of double materiality and corporate circularity disclosure analysis is highlighted by the connectivity analysis on material financial and ESG reporting and circularity disclosure. Assessing double materiality information requires professional judgment, and mapping the sustainability aspects related to disclosure requirements requires a unitary methodology and a customized list of impact, risks, and opportunities. The study’s implications aim to improve sustainability information reporting and materiality matrix analysis but can also be extended to circular economy regulations.

Suggested Citation

  • Victoria Bogdan & Luminița Rus & Diana Elisabeta Matica, 2025. "The Interconnection of Double Materiality Assessment, Circularity Practices Disclosure and Business Development in the Fast Fashion Industry," Sustainability, MDPI, vol. 17(4), pages 1-23, February.
  • Handle: RePEc:gam:jsusta:v:17:y:2025:i:4:p:1619-:d:1592088
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/4/1619/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2071-1050/17/4/1619/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Giuseppe Nicolò & Gianluca Zanellato & Adriana Tiron-Tudor, 2020. "Integrated Reporting and European State-Owned Enterprises: A Disclosure Analysis Pre and Post 2014/95/EU," Sustainability, MDPI, vol. 12(5), pages 1-17, March.
    2. Omar. A. Alghamdi & Gomaa Agag, 2023. "Unlocking the Power of Reporting: Exploring the Link between Voluntary Sustainability Reporting, Customer Behavior, and Firm Value," Sustainability, MDPI, vol. 15(21), pages 1-18, November.
    3. Carol A. Adams & Frank Mueller, 2022. "Academics and policymakers at odds: the case of the IFRS Foundation Trustees’ consultation paper on sustainability reporting," Sustainability Accounting, Management and Policy Journal, Emerald Group Publishing Limited, vol. 13(6), pages 1310-1333, May.
    4. Neelam Setia & Subhash Abhayawansa & Mahesh Joshi & Nandana Wasantha Pathiranage, 2024. "Shifting perspectives: unveiling the dual nature of sustainability materiality in integrated reports," Meditari Accountancy Research, Emerald Group Publishing Limited, vol. 32(4), pages 1291-1323, February.
    5. Davide Antonioli & Claudia Ghisetti & Massimiliano Mazzanti & Francesco Nicolli, 2022. "Sustainable production: The economic returns of circular economy practices," Business Strategy and the Environment, Wiley Blackwell, vol. 31(5), pages 2603-2617, July.
    6. Raphaëlle Stewart & Monia Niero, 2018. "Circular economy in corporate sustainability strategies: A review of corporate sustainability reports in the fast‐moving consumer goods sector," Business Strategy and the Environment, Wiley Blackwell, vol. 27(7), pages 1005-1022, November.
    7. Francesca Manes-Rossi & Adriana Tiron-Tudor & Giuseppe Nicolò & Gianluca Zanellato, 2018. "Ensuring More Sustainable Reporting in Europe Using Non-Financial Disclosure—De Facto and De Jure Evidence," Sustainability, MDPI, vol. 10(4), pages 1-20, April.
    8. Doroteja Mandarić & Anica Hunjet & Dijana Vuković, 2022. "The Impact of Fashion Brand Sustainability on Consumer Purchasing Decisions," JRFM, MDPI, vol. 15(4), pages 1-17, April.
    9. Benedetta Esposito & Nicola Raimo & Ornella Malandrino & Filippo Vitolla, 2023. "Circular economy disclosure and integrated reporting: The role of corporate governance mechanisms," Business Strategy and the Environment, Wiley Blackwell, vol. 32(8), pages 5403-5419, December.
    10. Christian Nielsen, 2023. "ESG Reporting and Metrics: From Double Materiality to Key Performance Indicators," Sustainability, MDPI, vol. 15(24), pages 1-15, December.
    11. Victoria Bogdan & Luminita Rus & Dana Simona Gherai & Adrian Gheorghe Florea & Nicoleta Georgeta Bugnar, 2023. "A Streamline Sustainable Business Performance Reporting Model by an Integrated FinESG Approach," Sustainability, MDPI, vol. 15(24), pages 1-26, December.
    12. Subhash Abhayawansa, 2022. "Swimming against the tide: back to single materiality for sustainability reporting," Sustainability Accounting, Management and Policy Journal, Emerald Group Publishing Limited, vol. 13(6), pages 1361-1385, September.
    13. Natālija Cudečka-Puriņa & Dzintra Atstāja & Viktor Koval & Māris Purviņš & Pavlo Nesenenko & Oleksandr Tkach, 2022. "Achievement of Sustainable Development Goals through the Implementation of Circular Economy and Developing Regional Cooperation," Energies, MDPI, vol. 15(11), pages 1-18, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mărioara Beleneși & Victoria Bogdan & Dorina Nicoleta Popa, 2021. "Disclosure Dynamics and Non-Financial Reporting Analysis. The Case of Romanian Listed Companies," Sustainability, MDPI, vol. 13(9), pages 1-23, April.
    2. Elena Nechita & Cristina Lidia Manea & Elena-Mirela Nichita & Alina-Mihaela Irimescu & Diana Manea, 2020. "Is Financial Information Influencing the Reporting on SDGs? Empirical Evidence from Central and Eastern European Chemical Companies," Sustainability, MDPI, vol. 12(21), pages 1-34, November.
    3. Tina Wiegand & Martin Wynn, 2023. "Sustainability, the Circular Economy and Digitalisation in the German Textile and Clothing Industry," Sustainability, MDPI, vol. 15(11), pages 1-30, June.
    4. Imperiale, Francesca & Pizzi, Simone & Lippolis, Stella, 2023. "Sustainability reporting and ESG performance in the utilities sector," Utilities Policy, Elsevier, vol. 80(C).
    5. Asuamah Yeboah, Samuel, 2023. "Sustaining Change: Unravelling the Socio-cultural Threads of Sustainable Consumption," MPRA Paper 117981, University Library of Munich, Germany, revised 10 Jun 2023.
    6. Prianto Budi Saptono & Gustofan Mahmud & Intan Pratiwi & Dwi Purwanto & Ismail Khozen & Muhamad Akbar Aditama & Siti Khodijah & Maria Eurelia Wayan & Rina Yuliastuty Asmara & Ferry Jie, 2023. "Development of Climate-Related Disclosure Indicators for Application in Indonesia: A Delphi Method Study," Sustainability, MDPI, vol. 15(14), pages 1-25, July.
    7. Monia Niero & Charlotte L. Jensen & Chiara Farné Fratini & Jens Dorland & Michael S. Jørgensen & Susse Georg, 2021. "Is life cycle assessment enough to address unintended side effects from Circular Economy initiatives?," Journal of Industrial Ecology, Yale University, vol. 25(5), pages 1111-1120, October.
    8. Fiaz Ahmad Sulehri & Saba Sharif, 2022. "The Impact of Firm Sustainability on Firm Growth: Evidence from USA," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 8(2), pages 1-15, August.
    9. Bing Wang & Si Xu & Kung-Cheng Ho & I-Ming Jiang & Hung-Yi Huang, 2019. "Information Disclosure Ranking, Industry Production Market Competition, and Mispricing: An Empirical Analysis," Sustainability, MDPI, vol. 11(1), pages 1-16, January.
    10. Thilini Cooray & Samanthi Senaratne & A. D. Nuwan Gunarathne & Roshan Herath & Dileepa Samudrage, 2020. "Does Integrated Reporting Enhance the Value Relevance of Information? Evidence from Sri Lanka," Sustainability, MDPI, vol. 12(19), pages 1-25, October.
    11. Zhang, Abraham & Wang, Jason X. & Farooque, Muhammad & Wang, Yulan & Choi, Tsan-Ming, 2021. "Multi-dimensional circular supply chain management: A comparative review of the state-of-the-art practices and research," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 155(C).
    12. Adriana TIRON-TUDOR & Teodora Viorica FĂRCAŞ & Ioana DRAGU & Ecaterina Monica MOISE, 2020. "Non-Financial Reporting in Romania in the pre-Directive 2014/95/EU Period (1990-2013)," CECCAR Business Review, Body of Expert and Licensed Accountants of Romania (CECCAR), vol. 1(5), pages 63-72, May.
    13. Ziheng Niu & Jianliang Xiong & Xuesong Ding & Yao Wu, 2022. "Analysis of China’s Carbon Peak Achievement in 2025," Energies, MDPI, vol. 15(14), pages 1-18, July.
    14. Pina Puntillo & Carmela Gulluscio & Donald Huisingh & Stefania Veltri, 2021. "Reevaluating waste as a resource under a circular economy approach from a system perspective: Findings from a case study," Business Strategy and the Environment, Wiley Blackwell, vol. 30(2), pages 968-984, February.
    15. Claudia Marcela Betancourt Morales & Jhon Wilder Zartha Sossa, 2020. "Circular economy in Latin America: A systematic literature review," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2479-2497, September.
    16. Olga Rataj & Serdar Türkeli, 2024. "Success Factors for Scaling Up and Raising Investment by Circular Entrepreneurs in Emerging Markets and Developing Economies," Circular Economy and Sustainability, Springer, vol. 4(2), pages 1021-1046, June.
    17. Agag, Gomaa & Eid, Riyad & Chaib Lababdi, Houyem & Abdelwahab, Mohamed & Aboul-Dahab, Sameh & Abdo, Said Shabban, 2024. "Understanding the impact of national culture differences on customers’ online social shopping behaviours," Journal of Retailing and Consumer Services, Elsevier, vol. 79(C).
    18. Marcos Ferasso & Tatiana Beliaeva & Sascha Kraus & Thomas Clauss & Domingo Ribeiro‐Soriano, 2020. "Circular economy business models: The state of research and avenues ahead," Business Strategy and the Environment, Wiley Blackwell, vol. 29(8), pages 3006-3024, December.
    19. Mihai Carp & Leontina Păvăloaia & Mihai-Bogdan Afrăsinei & Iuliana Eugenia Georgescu, 2019. "Is Sustainability Reporting a Business Strategy for Firm’s Growth? Empirical Study on the Romanian Capital Market," Sustainability, MDPI, vol. 11(3), pages 1-21, January.
    20. Elżbieta Jadwiga Szymańska & Robert Mroczek & Jadwiga Drożdż, 2024. "A Closed-Loop Economy in the Meat Industry for Generating Alternative Energy from Biogas Plants," Energies, MDPI, vol. 17(23), pages 1-18, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:17:y:2025:i:4:p:1619-:d:1592088. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.