Voluntary sustainability disclosure: evidence from New Zealand firms

Purpose This paper aims to explore the current practice of voluntary sustainability reporting in New Zealand. The ongoing criticisms from investors and other stakeholders indicate that there is a failure in financial reporting to address their informational needs for decision-making. This paper examines two aspects of voluntary sustainability reporting by investigating the extent of the uptake of integrated reporting (<IR>) and environmental, social and governance (ESG) reporting by New Zealand companies. Design/methodology/approach Using a qualitative methodology and an interpretative paradigm, the authors conducted a content analysis on the top 50 companies listed on the NZX50. The authors reviewed companies’ annual reports to examine their current practices in sustainability voluntary reporting disclosures. The authors ranked these disclosures to provide an indication of the quality of the reporting. A decision usefulness and accountability theoretical lens was applied to assist in the analysis of < IR> and ESG reporting. Findings The authors found that most companies were engaged in some form of voluntary sustainability reporting disclosures; some with more extensive and relevant disclosures than others. A total of 24 New Zealand listed companies have undertaken < IR>. A majority (26) of companies were engaged in some form of ESG disclosure. These ESG disclosures were found to be diverse in nature, as most companies did not appear to follow any reporting guidelines such as the Global Reporting Index Framework. Practical implications New Zealand companies’ voluntary ESG reporting still has a long way to go if they are to become globally recognised in reporting that is intended to address the informational needs of stakeholders. NZ policy makers and standard setters need a stronger presence to motivate companies to adopt < IR> and ESG reporting. The research is limited to the top 50 NZ publicly listed companies. Originality/value This study examined the current practice of voluntary sustainability reporting for both < IR> and ESG disclosures. Prior research has tended to focus on only one type of voluntary reporting disclosure.