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Research on Corporate Sustainability: Review and Directions for Future Research

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  • Grewal, Jody
  • Serafeim, George

Abstract

We review the literature on corporate sustainability and provide directions for future research. Our review focuses on three actions: measuring, managing and communicating corporate sustainability performance. Measurement is the least developed of the three and represents promising opportunities for research. Compelling evidence now exists on the role of management control systems, investor pressure and mandated disclosure in improving corporate sustainability outcomes. Research has moved beyond weighing the importance of all sustainability issues equally, with recent studies drawing distinctions between the financial materiality of different sustainability issues. Collectively, this new line of inquiry suggests that improving performance on material sustainability metrics is related to improved financial performance, helping to resolve four decades of inconclusive evidence on the relation between sustainability and financial outcomes. Finally, we review research on how disclosure mediums, accounting standards, information monitors and intermediaries shape the communication of sustainability performance. We conclude with a call for research on how to measure performance in the 21st century when corporate purpose extends beyond shareholder value maximization.

Suggested Citation

  • Grewal, Jody & Serafeim, George, 2020. "Research on Corporate Sustainability: Review and Directions for Future Research," Foundations and Trends(R) in Accounting, now publishers, vol. 14(2), pages 73-127, September.
    • Handle: RePEc:now:fntacc:1400000061
    DOI: 10.1561/1400000061
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    References listed on IDEAS

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    Cited by:

    1. Katarzyna Anna Bilicka & Elisa Casi & Carol Seregni & Barbara Stage, 2021. "Tax Strategy Disclosure: A Greenwashing Mandate?," CESifo Working Paper Series 9030, CESifo.
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    3. Massimiliano Celli & Simona Arduini & Tommaso Beck, 2024. "Corporate Sustainability Reporting Directive (CSRD) and His Future Application Scenario for Italian SMEs," International Journal of Business and Management, Canadian Center of Science and Education, vol. 19(4), pages 1-44, July.
    4. Lu Xu & Li Xie & Shengjun Mei & Jianli Hao & Yuqian Zhang & Yu Song, 2024. "Corporate Sustainability Reporting and Stakeholders’ Interests: Evidence from China," Sustainability, MDPI, vol. 16(8), pages 1-19, April.
    5. Downar, Benedict & Ernstberger, Jürgen & Reichelstein, Stefan & Schwenen, Sebastian & Zaklan, Aleksandar, 2021. "The impact of carbon disclosure mandates on emissions and financial operating performance," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 26(3), pages 1137-1175.
    6. Jake Thomas & Wentao Yao & Frank Zhang & Wei Zhu, 2022. "Meet, beat, and pollute," Review of Accounting Studies, Springer, vol. 27(3), pages 1038-1078, September.
    7. Paulina Kubera, 2023. "Behavioural Insights in Corporate Sustainability Research: A Review and Future Agenda," Sustainability, MDPI, vol. 15(19), pages 1-15, September.
    8. Laura Illia & Elena Alberti & Grazia Murtarelli & Elanor Colleoni, 2022. "Being best in the world or best for the world? Fostering CSR cooperative behaviors through communication," Italian Journal of Marketing, Springer, vol. 2022(2), pages 173-202, June.
    9. Alper Darendeli & Kelvin K. F. Law & Michael Shen, 2022. "Green new hiring," Review of Accounting Studies, Springer, vol. 27(3), pages 986-1037, September.
    10. Hans B. Christensen & Luzi Hail & Christian Leuz, 2021. "Mandatory CSR and sustainability reporting: economic analysis and literature review," Review of Accounting Studies, Springer, vol. 26(3), pages 1176-1248, September.
    11. S. Taniguchi, Kazuhiro, 2022. "Why Fukushima? A diachronic and multilevel comparative institutional analysis of a nuclear disaster," Energy Policy, Elsevier, vol. 167(C).
    12. Laura Tolettini & Eleonora Di Maria, 2023. "Structuring and Measuring Environmental Sustainability in the Steel Sector: A Single Case Study," Sustainability, MDPI, vol. 15(7), pages 1-26, April.
    13. Charl de Villiers & Jing Jia & Zhongtian Li, 2022. "Corporate social responsibility: A review of empirical research using Thomson Reuters Asset4 data," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(4), pages 4523-4568, December.
    14. Nataliya A. Kazakova & Thi L. Doan, 2021. "Model on Stakeholder Risks Disclosure in Corporate Reporting for Oil and Gas Companies in the Republic of Vietnam," International Journal of Energy Economics and Policy, Econjournals, vol. 11(6), pages 206-211.
    15. Nicolás Magner & Jaime F. Lavín & Mauricio A. Valle, 2022. "Modeling Synchronization Risk among Sustainable Exchange Trade Funds: A Statistical and Network Analysis Approach," Mathematics, MDPI, vol. 10(19), pages 1-30, October.
    16. Tiantian Wang & Kamisah Ismail & Khairul Saidah Abas Azmi, 2022. "The Rise of MCS and EMA in the Sustainable Field: A Systematic Literature Analysis," Sustainability, MDPI, vol. 14(24), pages 1-12, December.
    17. Peter Fiechter & Jörg‐Markus Hitz & Nico Lehmann, 2022. "Real Effects of a Widespread CSR Reporting Mandate: Evidence from the European Union's CSR Directive," Journal of Accounting Research, Wiley Blackwell, vol. 60(4), pages 1499-1549, September.
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    19. Kerry A. Humphreys & Ken T. Trotman, 2022. "Judgment and decision making research on CSR reporting in the COVID‐19 pandemic environment," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(1), pages 739-765, March.
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    More about this item

    Keywords

    Sustainability; ESG; measurement; accounting; disclosure; management control systems;
    All these keywords.

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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