Does sustainability reporting improve corporate behaviour?: Wrong question? Right time?

This paper takes its starting point from the ICAEW's ‘Sustainability: the role of accountants’ - one of the outputs from the Institute's Information for Better Markets initiative. In particular, an important series of questions arise around the extent to which (if at all) accountants can encourage - and should be encouraging ? the development of substantive social, environmental and sustainability reporting by large organisations and the extent to which such reporting should be governed by financial market principles and exigencies. The relationship(s) between social, environmental and financial performance and reporting are of increasing significance in this context and this significance is reflected in considerable growing interest in the business, accounting and political communities. At the heart of the matter, there is the tantalising suggestion that social responsibility, financial performance and voluntary sustainability reporting may be mutually constitutive and mutually reinforcing. That such a suggestion is, a priori, highly implausible seems to attract less interest. This paper seeks to investigate these matters in some detail by considering. in turn, what is meant by ‘sustainability’. the current state of affairs in ‘sustainability reporting’? and the extent to which social disclosure can be said to be related to the social and/or financial performance of organisations. The analysis suggests that the question set for this paper is mis-specified, that ‘sustainability’? reporting consistently fails to address sustainability and the increasing claims that financial and social performance are mutually determined and determining is probably incorrect and founded upon a tautology. The central theme of the paper is that sustainability is a matter of such concern that it must be treated as at least as important as any other criteria currently facing business, that sustainability reporting needs to be developed in a mandatory context as urgently as possible and that continuing focus upon the tautologies of social responsibility is a particularly foolish and dangerous enterprise.