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Changes in the state of trade, new business models with new sustainability methods and new technologies are the challenges ahead for the implementation of sustainable development programs. (Boons & Lüdeke-Freund, 2013). Factors such as compliance with regulations, pressure from stakeholders, competitive threats, market opportunities, and more competitive industries lead companies to decision-making and the application of new methods by using more sustainable business models and using the new technologies (Morioka et al., 2017). Organisations and companies need legitimacy to succeed in their goals (Scherer et al., 2013) and demonstrating social commitment, responsibility, and sustainability in behaviour are essential pillars. In fact, social engagement, gender equality and environmental considerations help companies take competitive positions and create new market benefits (Leonidou et al., 2013).
Sustainability reporting can help companies to address stakeholders and society expectations and gain the legitimacy they need to succeed (Martinez et al., 2016). Clear and consistent sustainability reports reduce information asymmetry among stakeholders and increase social acceptance (Hahn & Kühnen, 2013). In light of this, organisations and companies are increasingly paying attention to sustainability factors in their annual reports, and in applying new strategies for reporting (Clark et al., 2015).
Among these, the adoption of the United Nations Sustainable Development Goals - SDGs provide companies with the opportunity to address global challenges such as poverty, environmental degradation, climatic changes, and discrimination in order to achieve sustainable development goals over time (Adams, 2017).
Introduced in 2015 by the United Nations Procurement Division (UNDP) as the successors of the Millennium Development Goals (MDGs) signed in 2000, the SDGs are part of the 2030 Agenda for Sustainable Development the aim of which is to provide as a framework for institutions and organisations to work towards a more sustainable world (United Nations General Assembly, 2015). The SDGs consist of a set of 17 global goals structured into 169 ambitious targets to be reached by 2030. Given the growing importance of issues related to sustainable development in the world, contributing to the achievement of the SDGs is crucial for companies to succeed in the short and long term (Agarwal, Gneiting, & Mhlanga, 2017).
In order to empower corporate actions aimed to achieve the SDGs, in 2018 the United Nations Global Compact (UNGC) together with the Global Reporting Initiative (GRI) have created a collaborative initiative which enables companies to incorporate SDGs into their existing business and reporting processes. Business Reporting on the SDGs integrate the GRI Standards and the UN Global Compact Communication on Progress (Global Reporting Initiative, 2018). The integration of SDGs in business reports allows companies to achieve sustainable development goals in different areas (Kuzey & Uyar, 2017; Moldavska & Welo, 2019).
Furthermore, the publication of data on companies’ performance related to SDGs, provides investors with the possibility to quantify and compare the contributions of each company to the achievement of the SDGs, and, thus, to make more informed investment decisions by orienting their capital towards companies with a more positive impact.
Given the growing recognition of the value of corporate non-financial reporting, various scholars started to analyse factors influencing the adoption of new sustainability methods in business reporting (Hahn and Kühnen, 2013).
However, much of this literature mainly focuses on the quality of the different institutional environments and the pressure exerted by stakeholders on companies (Michelon & Parbonetti, 2012; Klettner et al., 2014).