SUSTAINABILITY REPORTING AND FIRM PERFORMANCE

Year 2019, Volume: 9 Issue: 1, 81 - 84, 30.07.2019

İdil Kaya Destan Halit Akbulut

https://doi.org/10.17261/Pressacademia.2019.1071

Abstract

Purpose- The aim of this paper is to
examine sustainability reporting and its relation with firm performance.  We investigate whether such reporting
practices improve the firm value while enhancing its profitability and the
financial leverage impact on sustainability reporting in the automotive
industry.

Methodology- The paper’s
design is based on panel data logistic regression analysis of 155 automotive
firms from 20 different countries, between 2010-2018 years. We use financial
data such as Tobin’s Q ratio of the public companies as well as firm size,
financial leverage ratio and return on assets to measure the firm performance
and we work with GRI’s reports on GRI Sustainability Disclosure Database.

Findings- We find similar results with some prior literature explaining that
sustainability reporting has a significant positive relation between firm size
and negative relation with financial leverage.

Conclusion- The study provides understandings on the relation of firm performance, firm
size, financial leverage, and sustainability reporting. The findings of study
indicate a positive significant relationship between firm size and SR, and a
negative significant relationship between financial leverage and sustainability
reporting in the automotive industry.

Keywords

Sustainability reporting, CSR reporting, firm performance, social and environmental reporting

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