Theoretical Grounding For Sustainability Reporting: A Comparison Between Indian And European Banks

Taral Pathak


Sustainability reporting (SR), is a critical part of organizational disclosures because it satisfies the conflicting demands of the various stakeholder and is rooted in the legitimacy and stakeholder theory. Banking industry is synonymous to financial reporting and with changing times they have been facing pressures to report the non-financial activities. The current study analyses the sustainability reporting of the top 60 banks – 20 Indian, European and International banks to investigate the focus of their social disclosures and provide a theoretical basis for the results. Content Analysis of the reports were made and the theoretical framework of the theories of social disclosure – legitimacy, institutional, stakeholder and resource-dependency was applied to the results to understand the basis of the non-financial disclosure made by the banks. Results indicate that the sustainability reporting of the banks is focused upon areas (Energy) which directly contribute to the functioning of the institution (banks) followed by reporting about agriculture and water because of the social consequence of agriculture in most nations. The results find support in the resource-dependency and legitimacy theories of social disclosures which has also been indicated by prior research. Findings scientifically validate the influencers in sustainability action and reporting and provides impetus and grounding to recent non-financial activities like positive impact financing, social responsibilities handled by hard-core financial institutions like banks.


Sustainable Reporting; Theories of non-financial disclosure; Banks.

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