Sustainability report credibility and market performance of Brazilian companies

Credibility is crucial in the communication between companies and society, particularly when addressing sustainability practices. This quality, vital for establishing effective communication, represents a significant challenge in corporate communication. In this context, this study aims to evaluate the impact of the credibility of environmental and social disclosures on the performance of companies listed on the Brazilian capital market. Analyzing a sample of 34 companies, we employed ALT software (Textual Readability Analysis) to assess the credibility of sustainability reports and the impact of this on company’s performance. Using hierarchical linear modeling, our results reveal that the credibility of environmental and social reports significantly influences the Brazilian companies’ market performance in potentially polluting industries. • Influence of the credibility of social evidence on the companies’ performance. • Credibility of environmental evidence influences the companies’ market performance. • It is the role of companies to signal information regarding environmental strategies. • Credibility of environmental and social disclosure by potentially polluting companies. • Credibility of sustainability reports from Brazilian companies.