Question

what incentives and disincentives do companies have to report sustainability information

Answer 1

Sustainability Report: It is an organisational report which gives information about social, environmental, economic and governance performance of the organisation.

Incentives of Sustainability reporting:

1. It helps the organisation to manage their environmental and social aspects.

2. It increases the standards of the organisation.

3. It results in higher employee engagement.

4. It provides increased efficiency with substantial decrease in wastage.

5. It helps to increase cash flow from investors.

6. It enhaces the company image and reputation.

Disincentives of Sustainability reporting:

Most of the disincentives with substantial reporting revolves around how the report is created and presented.

Such disincentives are as follows:

1. Feedback from the clients and stakeholders could be discounted.

2. Data collected for sustainability report may be unorganised or mismanaged.

3. The report should follow set of guidelines the Global reporting initiative which if diluted can be a disincentive.

4. The goals should be consistent, relevant and achievable. If deviated could be huge disincentive for the organisation.