IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i12p5336-d1675216.html
   My bibliography  Save this article

A Systematic Review of the Effects of Mandatory Corporate Sustainability Reporting

Author

Listed:
  • Triantafyllos Papafloratos

    (Business Administration Department, International Hellenic University, Terma Magnisias, 62 124 Serres, Greece)

  • Tania Pantazi

    (Tourism Management Department, Hellenic Open University, Evdoxou 5, 263 31 Patras, Greece)

Abstract

An increasing number of countries are introducing regulations on mandatory sustainability reporting, while researchers from various disciplines are trying to evaluate the effects of rendering sustainability reports mandatory. We conducted a review of 171 articles in Scopus-indexed journals, aiming to identify the most prominent topics and key research outputs. Our findings are categorized into four broad themes: the effects of legislation on the quality and quantity of the reports, the effects of financial performance on firms, the effects of ESG performance on firms and other effects. This is the first review to include a large number of empirical and non-empirical studies from various disciplines, including law. The positive effect of legislation on the quality, credibility and comparability of reports is more pronounced for countries outside Europe. The effects related to the financial performance of firms are positive in the long run. At the same time, regulation induces companies to adopt more CSR initiatives and may therefore be seen as an effective tool in rendering businesses more sustainable. Other perceived effects of increasing regulation are the fragmentation, complexity and rapid evolvement of the legislative framework on sustainability reporting, as well as the role of the institutional environment.

Suggested Citation

  • Triantafyllos Papafloratos & Tania Pantazi, 2025. "A Systematic Review of the Effects of Mandatory Corporate Sustainability Reporting," Sustainability, MDPI, vol. 17(12), pages 1-22, June.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:12:p:5336-:d:1675216
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/12/5336/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/17/12/5336/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Wendy Stubbs & Colin Higgins, 2018. "Stakeholders’ Perspectives on the Role of Regulatory Reform in Integrated Reporting," Journal of Business Ethics, Springer, vol. 147(3), pages 489-508, February.
    2. Hammed Afolabi & Ronita Ram & Gunnar Rimmel, 2022. "Harmonization of Sustainability Reporting Regulation: Analysis of a Contested Arena," Sustainability, MDPI, vol. 14(9), pages 1-26, May.
    3. Patrycja Hąbek & Radosław Wolniak, 2016. "Assessing the quality of corporate social responsibility reports: the case of reporting practices in selected European Union member states," Quality & Quantity: International Journal of Methodology, Springer, vol. 50(1), pages 399-420, January.
    4. Xue, Shuyu & Chang, Qi & Xu, Jingwen, 2023. "The effect of voluntary and mandatory corporate social responsibility disclosure on firm profitability: Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 77(C).
    5. Jean-Noël Chauvey & Sophie Giordano-Spring & Charles H. Cho & Dennis M. Patten, 2015. "The Normativity and Legitimacy of CSR Disclosure: Evidence from France," Post-Print hal-02009500, HAL.
    6. Mohamed Chelli & Sylvain Durocher & Anne Fortin, 2018. "Normativity in Environmental Reporting: A Comparison of Three Regimes," Journal of Business Ethics, Springer, vol. 149(2), pages 285-311, May.
    7. Jean-Noël Chauvey & Sophie Giordano-Spring & Charles Cho & Dennis Patten, 2015. "The Normativity and Legitimacy of CSR Disclosure: Evidence from France," Journal of Business Ethics, Springer, vol. 130(4), pages 789-803, September.
    8. Huifeng Xu & Xiaodong Xu & Junli Yu, 2021. "The Impact of Mandatory CSR Disclosure on the Cost of Debt Financing: Evidence from China," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 57(8), pages 2191-2205, June.
    9. Mercedes Luque-Vílchez & Carlos Larrinaga, 2016. "Reporting Models do not Translate Well: Failing to Regulate CSR Reporting in Spain," Social and Environmental Accountability Journal, Taylor & Francis Journals, vol. 36(1), pages 56-75, April.
    10. Yukun Pan & Rui Zhao, 2022. "Does Mandatory Disclosure of CSR Reports Affect Accounting Conservatism? Evidence from China," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 58(7), pages 1975-1987, May.
    11. Mumbi Maria Wachira & Thomas Berndt & Carlos Martinez Romero, 2019. "The adoption of international sustainability and integrated reporting guidelines within a mandatory reporting framework: lessons from South Africa," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 16(5), pages 613-629, June.
    12. Li Liu & Gary Gang Tian, 2021. "Mandatory CSR disclosure, monitoring and investment efficiency: evidence from China," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 61(1), pages 595-644, March.
    13. Shane Leong & James Hazelton, 2019. "Under what conditions is mandatory disclosure most likely to cause organisational change?," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 32(3), pages 811-835, May.
    14. Chen, Xiaoqi & Li, Weiping & Torsin, Wouter & Tsang, Albert, 2024. "Dividend policy under mandatory ESG reporting," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 93(C).
    15. Perera, Luckmika & Jubb, Christine & Gopalan, Sandeep, 2019. "A comparison of voluntary and mandated climate change-related disclosure," Journal of Contemporary Accounting and Economics, Elsevier, vol. 15(2), pages 243-266.
    16. Jiang, Wei & Zhang, Cheng & Si, Chengyu, 2022. "The real effect of mandatory CSR disclosure: Evidence of corporate tax avoidance," Technological Forecasting and Social Change, Elsevier, vol. 179(C).
    17. A.H. Fatima & Norhayati Abdullah & Maliah Sulaiman, 2015. "Environmental disclosure quality: examining the impact of the stock exchange of Malaysia’s listing requirements," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 11(4), pages 904-922, October.
    18. Cristian R. Loza Adaui, 2020. "Sustainability Reporting Quality of Peruvian Listed Companies and the Impact of Regulatory Requirements of Sustainability Disclosures," Sustainability, MDPI, vol. 12(3), pages 1-22, February.
    19. Xue Wang & Feng Cao & Kangtao Ye, 2018. "Mandatory Corporate Social Responsibility (CSR) Reporting and Financial Reporting Quality: Evidence from a Quasi-Natural Experiment," Journal of Business Ethics, Springer, vol. 152(1), pages 253-274, September.
    20. Christian Fisch & Joern Block, 2018. "Six tips for your (systematic) literature review in business and management research," Management Review Quarterly, Springer, vol. 68(2), pages 103-106, April.
    21. Patrizia Gazzola & Roberta Pezzetti & Stefano Amelio & Daniele Grechi, 2020. "Non-Financial Information Disclosure in Italian Public Interest Companies: A Sustainability Reporting Perspective," Sustainability, MDPI, vol. 12(15), pages 1-16, July.
    22. repec:eme:aaaj00:aaaj-12-2015-2361 is not listed on IDEAS
    23. Claudia Arena & Ronald Liong & Petros Vourvachis, 2018. "Carrot or stick: CSR disclosures by Southeast Asian companies," Sustainability Accounting, Management and Policy Journal, Emerald Group Publishing Limited, vol. 9(4), pages 422-454, July.
    24. Yan Jiang & Qingliang Tang, 2023. "Mandatory carbon reporting, voluntary carbon disclosure and ESG performance," Pacific Accounting Review, Emerald Group Publishing Limited, vol. 35(4), pages 534-561, August.
    25. Giorgio Mion & Cristian R. Loza Adaui, 2019. "Mandatory Nonfinancial Disclosure and Its Consequences on the Sustainability Reporting Quality of Italian and German Companies," Sustainability, MDPI, vol. 11(17), pages 1-28, August.
    26. A.H. Fatima & Norhayati Abdullah & Maliah Sulaiman, 2015. "Environmental disclosure quality: examining the impact of the stock exchange of Malaysia’s listing requirements," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 11(4), pages 904-922, October.
    27. Silvia Carnini Pulino & Mirella Ciaburri & Barbara Sveva Magnanelli & Luigi Nasta, 2022. "Does ESG Disclosure Influence Firm Performance?," Sustainability, MDPI, vol. 14(13), pages 1-18, June.
    28. Andreja Primec & Jernej Belak, 2022. "Sustainable CSR: Legal and Managerial Demands of the New EU Legislation (CSRD) for the Future Corporate Governance Practices," Sustainability, MDPI, vol. 14(24), pages 1-28, December.
    29. Lopin Kuo & Po-Wen Kuo & Chun-Chih Chen, 2021. "Mandatory CSR Disclosure, CSR Assurance, and the Cost of Debt Capital: Evidence from Taiwan," Sustainability, MDPI, vol. 13(4), pages 1-19, February.
    30. Zeineb Miniaoui & Faten Chibani & Khaled Hussainey, 2019. "The impact of country‐level institutional differences on corporate social responsibility disclosure engagement," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(6), pages 1307-1320, November.
    31. Michela Cordazzo & Laura Bini & Giuseppe Marzo, 2020. "Does the EU Directive on non‐financial information influence the value relevance of ESG disclosure? Italian evidence," Business Strategy and the Environment, Wiley Blackwell, vol. 29(8), pages 3470-3483, December.
    32. Xiaomei Guo & Changlan Yang & Qi Ban & Yang Xie, 2024. "The Impact of Mandatory Corporate Social Responsibility Disclosure on Enterprise Risk-Taking: Facilitative or Constraining?," Sustainability, MDPI, vol. 16(12), pages 1-20, June.
    33. Daniela Coluccia & Stefano Fontana & Silvia Solimene, 2018. "Does Institutional Context Affect CSR Disclosure? A Study on Eurostoxx 50," Sustainability, MDPI, vol. 10(8), pages 1-20, August.
    34. Claudia Arena & Ronald Liong & Petros Vourvachis, 2018. "Carrot or stick: CSR disclosures by Southeast Asian companies," Sustainability Accounting, Management and Policy Journal, Emerald Group Publishing Limited, vol. 9(4), pages 422-454, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Selena Aureli & Mara Del Baldo & Rosa Lombardi & Fabio Nappo, 2020. "Nonfinancial reporting regulation and challenges in sustainability disclosure and corporate governance practices," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2392-2403, September.
    2. Hamed, Ruba Subhi & Al-Shattarat, Basiem Khalil & Al-Shattarat, Wasim Khalil & Hussainey, Khaled, 2022. "The impact of introducing new regulations on the quality of CSR reporting: Evidence from the UK," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 46(C).
    3. Cristian R. Loza Adaui, 2020. "Sustainability Reporting Quality of Peruvian Listed Companies and the Impact of Regulatory Requirements of Sustainability Disclosures," Sustainability, MDPI, vol. 12(3), pages 1-22, February.
    4. Salvatore Loprevite & Domenico Raucci & Daniela Rupo, 2020. "KPIs Reporting and Financial Performance in the Transition to Mandatory Disclosure: The Case of Italy," Sustainability, MDPI, vol. 12(12), pages 1-24, June.
    5. Rong Xu & Yongze Cui & Qi Ban & Yang Xie & Xiaoyun Fan, 2024. "Can Mandatory Disclosure of CSR Information Drive the Transformation of Firms towards High-Quality Development?," Sustainability, MDPI, vol. 16(10), pages 1-21, May.
    6. Nurul Jannah Mustafa Khan & Hasani Mohd Ali, 2023. "Regulations on Non-Financial Disclosure in Corporate Reporting: A Thematic Review," Sustainability, MDPI, vol. 15(3), pages 1-23, February.
    7. Estíbaliz Biedma López & Manuel Larrán Jorge & Nieves Gómez Aguilar & María C. Conesa Carril, 2024. "SOEs' commitment to transparency: Voluntary disclosure as a driver of mandatory disclosure," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 95(3), pages 883-917, September.
    8. Wu, Di & Sun, Qian & Zhang, Wenyu & Xu, Guanghua & Chan, Kam C. & Qin, Jie, 2024. "Does information content of a corporate social responsibility report matter for stock mispricing? Evidence from China," International Review of Financial Analysis, Elsevier, vol. 95(PB).
    9. Ismail N.B. & Sébastien Alcouffe & Galy N & Ceulemans K, 2020. "The impact of international sustainability initiatives on Life Cycle Assessment voluntary disclosures: The case of France’s CAC40 listed companies," Post-Print hal-03082800, HAL.
    10. Stefania Veltri & Elena Cristiano & Olga Ferraro, 2023. "Examining the quality of the consolidated mandatory non‐financial statements of a cooperative banking group: A longitudinal analysis," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(4), pages 1573-1587, July.
    11. Susanne Arvidsson & John Dumay, 2022. "Corporate ESG reporting quantity, quality and performance: Where to now for environmental policy and practice?," Business Strategy and the Environment, Wiley Blackwell, vol. 31(3), pages 1091-1110, March.
    12. Agustina, Lidya, 2021. "Does financial performance moderate the effect of CEO characteristics and stakeholder influence on corporate social responsibility in Indonesia?," Technium Business and Management, Technium Science, vol. 2(1), pages 13-29.
    13. Angus W. H. Yip & William Y. P. Yu, 2023. "The Quality of Environmental KPI Disclosure in ESG Reporting for SMEs in Hong Kong," Sustainability, MDPI, vol. 15(4), pages 1-26, February.
    14. Katharina Hombach & Thorsten Sellhorn, 2019. "Shaping Corporate Actions Through Targeted Transparency Regulation: A Framework and Review of Extant Evidence," Schmalenbach Business Review, Springer;Schmalenbach-Gesellschaft, vol. 71(2), pages 137-168, May.
    15. Simona Cosma & Rossella Leopizzi & Simone Pizzi & Mario Turco, 2021. "The stakeholder engagement in the European banks: Regulation versus governance. What changes after the NF directive?," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(3), pages 1091-1103, May.
    16. Cristian Carini & Laura Rocca & Monica Veneziani & Claudio Teodori, 2018. "Ex-Ante Impact Assessment of Sustainability Information–The Directive 2014/95," Sustainability, MDPI, vol. 10(2), pages 1-24, February.
    17. Ho-Tan-Phat Phan & Francesco De Luca & Lea Iaia, 2020. "The “Walk” towards the UN Sustainable Development Goals: Does Mandated “Talk” through NonFinancial Disclosure Affect Companies’ Financial Performance?," Sustainability, MDPI, vol. 12(6), pages 1-20, March.
    18. Fabio Caputo & Rossella Leopizzi & Simone Pizzi & Virginia Milone, 2019. "The Non-Financial Reporting Harmonization in Europe: Evolutionary Pathways Related to the Transposition of the Directive 95/2014/EU within the Italian Context," Sustainability, MDPI, vol. 12(1), pages 1-13, December.
    19. Bruce Pinnington & Amy Benstead & Joanne Meehan, 2023. "Transparency in Supply Chains (TISC): Assessing and Improving the Quality of Modern Slavery Statements," Journal of Business Ethics, Springer, vol. 182(3), pages 619-636, January.
    20. Elisabeth Albertini, 2019. "Integrated reporting: an exploratory study of French companies," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 23(2), pages 513-535, June.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:17:y:2025:i:12:p:5336-:d:1675216. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.