Value Creation Reporting for Sustainable Development – Is Sustainability Information Integrated with Financial Information?

The transition to more sustainable economic development is at the heart of the Agenda 2030 for Sustainable Development by the United Nations. This leads to a broader definition of value that integrates social and environmental aspects alongside economic value. In this paper, we derive a structure for the analysis of reporting on sustainable value creation based on actual reporting decisions. Structuring the disclosures on sustainable value creation focuses on presentation, integration, measurement and aggregation. We further provide descriptive evidence on firms’ reporting decisions on sustainable value creation by manually analysing the reports of the 20 largest Swiss companies from 2013–2022 and the 2022 reports of the 50 largest EU listed companies. The analysis suggests a substantial increase in reporting on sustainable value creation over time with slightly more than 50% of firms reporting on sustainable value creation in 2022. Firms tend to report in visual form and focus on prior year realizations of measures in the environmental and social areas. Firms’ impacts and dependencies on people and planet are vaguely integrated with financial considerations and dependencies are rarely addressed. Aggregated or forward-looking measures are largely missing.