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Do Sustainability Reports Strategically Employ Rhetorical Tone? : An evidence from Japan

Author

Listed:
  • Yuriko Nakao

    (Faculty of Business Administration, Tottori University of Environmental Studies)

  • Katsuhiko Kokubu

    (Graduate School of Business Administration, Kobe University)

  • Kimitaka Nishitani

    (Research Institute for Economics and Business Administration, Kobe University)

Abstract

Narrative content in sustainability reports can affect readers' impressions of a company, but there are no clear guidelines for companies on how to construct this content. This study examines narratives in sustainability reports to clarify factors that influence corporate disclosure strategies. We investigate chief executive officer (CEO) statements and environmental and social information sections in sustainability reports of Japanese companies over a two-year period. The results show that CEO statements tend to use an optimistic and ambiguous tone when social and environmental performance is poor, that stakeholders can influence the narrative tone of reporting, and that sustainability reporting approaches differ by industry. This is a novel approach to quantitative analyses on sustainability reporting narratives because it uniquely discusses the authenticity of textual expressions in sustainability reports. The results further an understanding of narratives’ credibility issues. This study demonstrates the importance of textual expressions to encourage correct interpretations of performance information.

Suggested Citation

  • Yuriko Nakao & Katsuhiko Kokubu & Kimitaka Nishitani, 2019. "Do Sustainability Reports Strategically Employ Rhetorical Tone? : An evidence from Japan," Discussion Papers 2019-01, Kobe University, Graduate School of Business Administration.
    • Handle: RePEc:kbb:dpaper:2019-01
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    Keywords

    DICTION; impression management; narratives; sustainability reporting; tone;
    All these keywords.

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