Sustainability Reporting as a Strategic Tool for Sustainable Development: A Multi-case Study of Organizational Practices in the Global Energy Industry

Abstract

This paper investigates the strategic use of sustainability reports by large global energy companies. The problem statement seeks to answer in what ways the companies use sustainability reporting as part of their strategic approach to sustainable development. The paper employs institutional, legiti-macy, and contingency theories, as well as a comprehensive literature review. Six key themes were identified through the literature review and using a multi-case analysis of the energy companies' sus-tainability reports, they were analyzed based on these themes. The findings suggest that sustainability reporting is a significant strategic instrument for companies in the energy industry, and company characteristics play a significant role in reporting. Overall, the case companies show evidence of a uniform approach to sustainability reporting, while individual and company-specific needs direct how each company employs the standardized guidelines to meet their requirements. At first glance, the companies may appear alike but diving deeper into the reports reveals that unique institutional and contextual factors, such as (supra)national legislation and cultural norms, play an important role. Further, empirical evidence suggests that the quest for legitimacy and a social license to operate are also significant factors in shaping the companies’ sustainability reports. Finally, the findings im-ply that contingency theory is at play, in that no universal best practice seems to be present. The results highlight the importance of making relevant, adequate, and credible reports, which have a strategically important role for the company’s sustainable development. The paper concludes that sustainability reporting provides companies with a unique opportunity to inform and satisfy stake-holders externally while motivating and directing their efforts internally. The study suggests several future research directions, including studies of other industries and comparisons across industries, to further investigate the role of sustainability reports in achieving sustainable development.