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Research on Corporate Sustainability: Review and Directions for Future Research

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  • Grewal, Jody
  • Serafeim, George

Abstract

We review the literature on corporate sustainability and provide directions for future research. Our review focuses on three actions: measuring, managing and communicating corporate sustainability performance. Measurement is the least developed of the three and represents promising opportunities for research. Compelling evidence now exists on the role of management control systems, investor pressure and mandated disclosure in improving corporate sustainability outcomes. Research has moved beyond weighing the importance of all sustainability issues equally, with recent studies drawing distinctions between the financial materiality of different sustainability issues. Collectively, this new line of inquiry suggests that improving performance on material sustainability metrics is related to improved financial performance, helping to resolve four decades of inconclusive evidence on the relation between sustainability and financial outcomes. Finally, we review research on how disclosure mediums, accounting standards, information monitors and intermediaries shape the communication of sustainability performance. We conclude with a call for research on how to measure performance in the 21st century when corporate purpose extends beyond shareholder value maximization.

Suggested Citation

  • Grewal, Jody & Serafeim, George, 2020. "Research on Corporate Sustainability: Review and Directions for Future Research," Foundations and Trends(R) in Accounting, now publishers, vol. 14(2), pages 73-127, September.
    • Handle: RePEc:now:fntacc:1400000061
    DOI: 10.1561/1400000061
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    References listed on IDEAS

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    5. Paula A. Tkac, 2006. "One proxy at a time : pursuing social change through shareholder proposals," Economic Review, Federal Reserve Bank of Atlanta, vol. 91(Q 3), pages 1-20.
    6. George Serafeim, 2015. "Integrated Reporting and Investor Clientele," Journal of Applied Corporate Finance, Morgan Stanley, vol. 27(2), pages 34-51, June.
    7. David A. Waldman & Donald S. Siegel & Mansour Javidan, 2006. "Components of CEO Transformational Leadership and Corporate Social Responsibility," Journal of Management Studies, Wiley Blackwell, vol. 43(8), pages 1703-1725, December.
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    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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