A Review of Sustainability-Driven Corporate Reporting: Best Practices and Challenges in Palm Oil Sector Financial Reporting Disclosures

Abstract : Growing global emphasis on ESG accountability has placed the palm oil sector under closer examination, given its recurrent environmental and social controversies. In response, sustainability-driven corporate reporting has become a critical mechanism for demonstrating transparency and aligning with international disclosure standards. This study aims to systematically review best practices and challenges in sustainability reporting within the palm oil industry from 2020 to 2025. A qualitative approach was employed using a Systematic Literature Review (SLR) method. Data were collected through a structured search of the Scopus database using targeted keywords, yielding 96 initial articles. Through sequential screening based on relevance, publication period, language, and accessibility, 28 articles were identified as eligible for in-depth analysis. Through thematic coding, the study examined the data to uncover recurring themes and to categorize outcomes into effective reporting practices and associated challenges. The results reveal five dominant best practices: adoption of Global Reporting Initiative (GRI) and Task Force on Climate-related Financial Disclosures (TCFD) frameworks, integration of ESG metrics into financial reports, stakeholder-inclusive reporting models, third-party assurance, and digital transparency tools. Conversely, key challenges include inconsistent reporting standards, limited data reliability, regulatory fragmentation, resource constraints for smaller firms, and greenwashing risks. The study concludes that while substantial progress has been made, the palm oil sector requires stronger harmonization of standards and capacity building to enhance credibility. Future research should expand by integrating cross-sector comparisons and by evaluating the role of emerging digital technologies, such as blockchain, in enhancing the reliability of sustainability disclosures.