Doç. Dr. Semen Son-Turan


Sustainable, CSR, ESG, social responsibility, triple bottom line or social reporting are interchangeably used terms, which, in essence refer to the same phenomenon. Deegan (2007) provides a comprehensive definition of social reporting which he defines as the provision of information about the performance of an organization in relation to its interaction with its physical and social environment and includes, among others: (1) interaction with the local community, (2) level of support for community projects, (3) level of support for developing countries, (4) health and safety record, (5) training, employment and education programs, and, (5) environmental performance.

Organizations and professional bodies in the 1990’s led the way in the preparation of stand-alone reports, which were initially called environmental reports, then social reports, and are nowadays commonly referred to as “sustainability reports”.

Sustainability reporting can help organizations to measure, assess, evaluate, understand and communicate environmental, economic, and social and governance dimensions of their day-to-day operations.

Over the years, an increasing number of institutions globally have convened to discuss how non-financial information should be reported and to what extent.

Among others, the Social Accounting Standards Board (SASB), the Global Reporting Initiative (GRI), and, the International Integrated Reporting Council (IIRC) have acted as pioneers in developing sustainability reporting standards and respective disclosures for organizations.

The Global Reporting Initiative (GRI) is probably the best-known framework for voluntary reporting of these components by organizations. (Reports can be found in the GRI Disclosure Database

According to a report by World Business Council for Sustainable Development (WBSCD) and its global partners the number of sustainability reporting requirements – the provisions, which specify either mandatory and voluntary disclosure requirements of specific non-financial information – since the 1992 Rio Earth Summit, has increased more than ten-fold. Consequently, there are now over 1000 reporting requirements that have been introduced by various national and supranational bodies.

While sustainability reporting, with some regional exceptions, is still of voluntary nature, theoretical perspectives have been adopted as to why it has become so widespread. Among these stakeholder theory and legitimacy theory stand out as potentially viable explanations.

According to stakeholder theory the corporation's continued existence requires the support of the stakeholders and their approval must be sought and the activities of the corporation adjusted to gain that approval. The more powerful the stakeholders, the more the company must adapt. Social disclosure is thus seen as part of the dialogue between the company and its stakeholders (Gray, Kouhy & Lavers 1995). Legitimacy Theory, on the other hand, is probably the most widely used theory to explain non-financial reporting (Campbell, Craven and Shrives, 2003) and has an advantage over other theories in that it provides disclosing strategies that organizations may adopt to legitimize their existence that may be empirically tested (Gray, Kouhy and Lavers, 1995).

 The IFC lists the following motivations for sustainability reporting:

  • Stakeholder relationships (license to operate)
  • Risk reduction (reputational and operational)
  • Investor relationships
  • Identification of new markets and business opportunities
  • Future resilience
  • Employee morale
  • Improved strategy and management systems



Campbell, D., Craven, B., & Shrives, P. (2003). Voluntary social reporting in three FTSE sectors: a comment on perception and legitimacy. Accounting, Auditing & Accountability Journal, 16(4), 558-581.

Deegan, C. (2007), “Organizational legitimacy as a motive for sustainability reporting”, in Unerman, J., Bebbington, J. and O’Dy

Gray, R., Kouhy, R., & Lavers, S. (1995). Corporate social and environmental reporting: a review of the literature and a longitudinal study of UK disclosure. Accounting, Auditing & Accountability Journal, 8(2), 47-77.