Does Sustainability Reporting Impact Financial Performance? Evidence from the Largest Portuguese Companies
Abstract
1. Introduction
2. Theoretical Background and Research Hypothesis
3. Materials and Methods
3.1. Sample
3.2. Methodology
4. Results and Discussion
4.1. Univariate Analysis
4.2. Multivariate Analysis
4.3. Robustness: Multivariate Analysis by Sector
5. Conclusions
Author Contributions
Funding
Institutional Review Board Statement
Informed Consent Statement
Data Availability Statement
Conflicts of Interest
Appendix A
Descriptive Statistics | |||||
---|---|---|---|---|---|
N | Min | Max | Mean | Std. Dev. | |
ROA | 297 | −48.224 | 67.586 | 2.987 | 11.272 |
Size | 297 | 14.467 | 23.809 | 18.535 | 1.298 |
Leverage | 297 | 1.094 | 433.764 | 65.598 | 33.976 |
Growth | 297 | −81.320 | 8206.905 | 28.203 | 480.378 |
Liquidity | 297 | 0.048 | 21.304 | 1.650 | 1.764 |
Correlation Matrix | |||||
---|---|---|---|---|---|
ROA | Size | Leverage | Growth | Liquidity | |
ROA | 1 | −0.225 *** | −0.407 *** | 0.021 | 0.213 *** |
Size | −0.225 *** | 1 | 0.082 | 0.105 * | 0.019 |
Leverage | −0.407 *** | 0.082 | 1 | −0.113 * | −0.446 *** |
Growth | 0.021 | 0.105 * | −0.113 * | 1 | 0.645 *** |
Liquidity | 0.213 *** | 0.019 | −0.446 *** | 0.645 *** | 1 |
Collinearity Statistics | ||
---|---|---|
Tolerance | VIF | |
SR disclosure | 0.905 | 1.105 |
Sector | 0.865 | 1.155 |
Size | 0.865 | 1.156 |
Leverage | 0.708 | 1.412 |
Growth | 0.529 | 1.889 |
Liquidity | 0.439 | 2.278 |
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Ref. | Sample | Financial Performance | SR Disclosure | Results |
---|---|---|---|---|
[4] | 263 Italian listed companies; 2011–2020 | EBIT ROA | ESG score | Sustainability has a positive and significant impact on EBIT |
[5] | 84 companies listed in New Zealand Stock Exchange; 2017–2019 | ROA ROE Tobin’s Q | Sustainability disclosure index | Sustainability has a positive and significant impact on ROA |
[6] | 35 companies listed in IBEX35; 2007–2011 | Stock price | CSR disclosure index | CSR has a positive and significant effect on stock prices |
[7] | 146 companies listed in Toronto Stock Exchange; 2007 | Market value | SR disclosure | Investors positively value SR disclosure |
[9] | 47 non-financial companies included in BIST Sustainability Index; 2008–2018 | ROA ROE Tobin’s Q | SR disclosure | Sustainability disclosure negatively impacts financial performance (ROA and ROE) and positively impacts market value (Tobin’s Q) |
[10] | 342 financial institutions; 2007–2016 | ROA ROE Tobin’s Q | ESG score | Sustainability disclosure negatively impacts financial performance (ROA and ROE) and positively impacts market value (Tobin’s Q) |
[23] | 220 companies listed in CSE; 2012–2016 | Tobin’s Q | CSR disclosures | CSR disclosures positively impact Tobin’s Q |
[25] | 80 non-financial Slovenian companies; 2007–2014 | ROA | Sustainability disclosures | Higher sustainability conduct results in a higher financial performance |
[26] | 20 companies listed in BSE GREENEX; 2008–2012 | ROA Tobin’s Q | Sustainability index | Sustainability reporting has a positive impact on financial performance in the long run |
Sector | SR Disclosure | |||
---|---|---|---|---|
Commerce and Services | Industry and Raw Materials | Do Not Disclose | Disclose | |
Voluntary | Mandatory | |||
180 | 117 | 231 | 54 | 12 |
61% | 39% | 78% | 18% | 4% |
SR Disclosure | ||
---|---|---|
ROA | Do Not Disclose | Disclose |
Mean | 3.020 | 2.872 |
Median | 3.246 | 3.500 |
Variance | 139.475 | 85.101 |
Standard Deviation | 11.810 | 9.225 |
Minimum | −48.224 | −45.972 |
Maximum | 67.586 | 27.741 |
N | 297 |
Mann–Whitney U | 7783 |
Standard error | 615.312 |
Standardized test statistic | 0.260 |
Asymptotic significance (two-tailed) | 0.795 |
N | 297 |
Mann–Whitney U | 7783 |
Standard error | 615.312 |
(1) | (2) | |||||
---|---|---|---|---|---|---|
Coef. | t | Sig. | Coef. | t | Sig. | |
Constant | 45.189 | 4.722 | *** | 43.426 | 4.768 | *** |
SR disclosure | 1.439 | 0.901 | 1.006 | 0.674 | ||
Sector | 3.386 | 2.553 | ** | 0.726 | 0.558 | |
Size | −2.365 | −4.514 | *** | −1.856 | −3.742 | *** |
Leverage | −0.114 | −5.527 | *** | |||
Growth | −0.001 | −0.811 | ||||
Liquidity | 0.596 | 1.179 | ||||
N | 297 | 297 | ||||
Z | 7.975 | *** | 12.699 | *** | ||
R-squared | 0.076 | 0.209 | ||||
Adj. R-squared | 0.066 | 0.193 |
Industrial and Raw Materials | Commerce and Services | |||||
---|---|---|---|---|---|---|
Coef. | t | Sig. | Coef. | t | Sig. | |
Constant | 37.590 | 2.976 | *** | 34.318 | 2.608 | ** |
SR disclosure | −0.721 | −0.473 | 2.447 | 1.051 | ||
Size | −1.416 | −2.071 | ** | −1.518 | −2.211 | ** |
Leverage | −0.121 | −2.767 | *** | −0.105 | −4.091 | *** |
Growth | 0.075 | 3.319 | *** | −0.005 | −1.696 | * |
Liquidity | 0.240 | 0.476 | 2.081 | 1.817 | * | |
N | 117 | 180 | ||||
Z | 8.266 | *** | 9.487 | *** | ||
R-squared | 0.273 | 0.215 | ||||
Adj. R-squared | 0.240 | 0.193 |
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Monteiro, S.; Roque, V.; Faria, M. Does Sustainability Reporting Impact Financial Performance? Evidence from the Largest Portuguese Companies. Sustainability 2024, 16, 6448. https://doi.org/10.3390/su16156448
Monteiro S, Roque V, Faria M. Does Sustainability Reporting Impact Financial Performance? Evidence from the Largest Portuguese Companies. Sustainability. 2024; 16(15):6448. https://doi.org/10.3390/su16156448
Chicago/Turabian StyleMonteiro, Sónia, Vanda Roque, and Márcia Faria. 2024. "Does Sustainability Reporting Impact Financial Performance? Evidence from the Largest Portuguese Companies" Sustainability 16, no. 15: 6448. https://doi.org/10.3390/su16156448
APA StyleMonteiro, S., Roque, V., & Faria, M. (2024). Does Sustainability Reporting Impact Financial Performance? Evidence from the Largest Portuguese Companies. Sustainability, 16(15), 6448. https://doi.org/10.3390/su16156448