are achieved through enhancing the transparency and
accountability of the corporate operations toward its potential stakeholders (Junior et al. 2017; Arnold 2017; Nobanee
and Ellili 2016). It is this reporting that forms the contextual
background for the intended research. SR is used by organizations as a tool to gain legitimacy and acceptance by the
society and to respond to the concerns of the different
stakeholders. For example, the sustainability disclosure by
the oil companies increased after the case of Exxon Valdes
oil spill and chemical companies increased after the case of
Bhopal leak. Moreover, reporting on the three dimensions of
sustainability determines the extent of the sustainability
reporting quality as they are the measure for the quality of
the corporate sustainability performance (Comyns et al.
2013; Nobanee and Ellili 2016; Latridis 2013; Roca and
Searcy 2012; Daub 2007). In addition to assessing the current sustainability performance of the corporation, SR is the
method responsible for communicating the information
about the corporate sustainability performance and progress
to the stakeholders. In addition, it is considered as the basis
for planning changes required to improve the sustainability
performance of the organization. SR is a competitive
advantage for the reporting organization as stakeholders are
more likely and more trusting to invest in organizations
reporting on business environmental and social issues
(Latridis 2013; Fritz et al. 2017; Lozano 2013; Ahmed and
Sundaram 2012; Gond et al. 2012; Gray et al. 1993).
Although focusing on the environmental and social aspects,
sustainability does not overlook the economic aspects and its
importance in reaching a sustainable performance. Based on
that, sustainability reporting is a crucial economic aspect of
sustainability. In which, sustainability reporting should
reflect all sustainability-related issues, including the corporate financial benefits, such as financial stability, profitability, and liquidity. It should be stressed here that financial
benefits should be the result of applying corporate sustainability activities. It is found that the sustainability reporting
disclosed by conventional banks listed in the UAE financial
markets, as opposed to Islamic banks, leads to a considerable
improvement in the economic, more specifically financial,
performance of these banks (Baumgartner and Rauter 2017;
Nobanee and Ellili 2016).
2 Research Problem
Although the concept of SR becomes, theoretically,
well-known in the last decade, the practice of SR among
corporations is still in its infancy and involves some confusing issues. Furthermore, most of the researches, implemented in the area of the SR and its measurement, were
qualitative studies while there are only a few empirical
studies in this area (Roca and Searcy 2012; Eugenio et al.
2013; Ane 2012; Bebbington 2009). Given the increasing
attention directed to sustainability and sustainability performance, research interest has grown in the latest years in
these areas among academics and practitioners. However,
most of the evolving studies focused on the quantity of the
disclosed information with less consideration to its quality
(Farneti and Guthrie 2009; Nobanee and Ellili 2016; Roca
and Searcy 2012; Bebbington et al. 2008). This may have
led to a deterioration in the quality of the reported information, having companies showing adequate detailed
information in terms of quantity but still not reflecting the
actual sustainability performance. Consequently, there is an
insistent need for future research on assessing and improving
the quality of SR (Comyns et al. 2013; Nobanee and Ellili
2016; Lamberton 2005). The quality of SR becomes a focus
subject for research and benchmarking studies nowadays.
There is a consensus on that although the number of sustainability reports is increasing among corporations the
quality of these reports is still poor. It is theoretically
claimed that the current quality of Sustainability Reporting
is Unsustainable, as corporations adopt a lower level of
quality for SR than that adopted by quality assessors and
academics (Comyns et al. 2013; Latridis 2013; Gray et al.
1993; Hubbard 2011; Rupley et al. 2012).
The United Nations Conference on Trade and Development (UNCTD) reported that the decisions taken by the
corporate stakeholders become more sophisticated because
of the methods used to report on sustainability issues. It is
found that the corporate disclosed by the Islamic banks are
inconsistent. A relevant survey reveals that 50% of the
surveyed investors in addition to all the study analysts
viewed SR as poor. Latridis (2013) found that reports
including sustainability disclosures in Malaysia are very
poor in which they are general, narrative in nature, and lack
quantitative indicators to a large extent. Dawkins and Lewis
(2003) found that 54% of the investors and 43% of the
analysts believe that the quality of the information disclosed
in the corporate sustainability reports is very deficient. The
level of SR in the tourism sector is very deficient (Nobanee
and Ellili 2016; Raiborn et al. 2011; Rowbottom and Lymer
2009; Wijk and Persoon 2006. Hooks and Staden 2011)
found that a considerable number of companies in the Centre
for Business and Sustainable Development (CBSD) database
are reporting poor quality sustainability disclosures. Ane
(2012) found that the quality of the environmental reporting
in China is still very lacking, especially in relation to reliance and comparability. The study reveals that out of the 110
tested firms in different sectors of China, only 5% are
reporting environmental information in a quantitative form
and 17% in both quantitative and qualitative forms. These
percentages are very low in terms of quantitative reported
information that is more required for a qualified sustainability report as it facilitates understanding and evaluation by
188
N. A. El-Rahman
accountability of the corporate operations toward its potential stakeholders (Junior et al. 2017; Arnold 2017; Nobanee
and Ellili 2016). It is this reporting that forms the contextual
background for the intended research. SR is used by organizations as a tool to gain legitimacy and acceptance by the
society and to respond to the concerns of the different
stakeholders. For example, the sustainability disclosure by
the oil companies increased after the case of Exxon Valdes
oil spill and chemical companies increased after the case of
Bhopal leak. Moreover, reporting on the three dimensions of
sustainability determines the extent of the sustainability
reporting quality as they are the measure for the quality of
the corporate sustainability performance (Comyns et al.
2013; Nobanee and Ellili 2016; Latridis 2013; Roca and
Searcy 2012; Daub 2007). In addition to assessing the current sustainability performance of the corporation, SR is the
method responsible for communicating the information
about the corporate sustainability performance and progress
to the stakeholders. In addition, it is considered as the basis
for planning changes required to improve the sustainability
performance of the organization. SR is a competitive
advantage for the reporting organization as stakeholders are
more likely and more trusting to invest in organizations
reporting on business environmental and social issues
(Latridis 2013; Fritz et al. 2017; Lozano 2013; Ahmed and
Sundaram 2012; Gond et al. 2012; Gray et al. 1993).
Although focusing on the environmental and social aspects,
sustainability does not overlook the economic aspects and its
importance in reaching a sustainable performance. Based on
that, sustainability reporting is a crucial economic aspect of
sustainability. In which, sustainability reporting should
reflect all sustainability-related issues, including the corporate financial benefits, such as financial stability, profitability, and liquidity. It should be stressed here that financial
benefits should be the result of applying corporate sustainability activities. It is found that the sustainability reporting
disclosed by conventional banks listed in the UAE financial
markets, as opposed to Islamic banks, leads to a considerable
improvement in the economic, more specifically financial,
performance of these banks (Baumgartner and Rauter 2017;
Nobanee and Ellili 2016).
2 Research Problem
Although the concept of SR becomes, theoretically,
well-known in the last decade, the practice of SR among
corporations is still in its infancy and involves some confusing issues. Furthermore, most of the researches, implemented in the area of the SR and its measurement, were
qualitative studies while there are only a few empirical
studies in this area (Roca and Searcy 2012; Eugenio et al.
2013; Ane 2012; Bebbington 2009). Given the increasing
attention directed to sustainability and sustainability performance, research interest has grown in the latest years in
these areas among academics and practitioners. However,
most of the evolving studies focused on the quantity of the
disclosed information with less consideration to its quality
(Farneti and Guthrie 2009; Nobanee and Ellili 2016; Roca
and Searcy 2012; Bebbington et al. 2008). This may have
led to a deterioration in the quality of the reported information, having companies showing adequate detailed
information in terms of quantity but still not reflecting the
actual sustainability performance. Consequently, there is an
insistent need for future research on assessing and improving
the quality of SR (Comyns et al. 2013; Nobanee and Ellili
2016; Lamberton 2005). The quality of SR becomes a focus
subject for research and benchmarking studies nowadays.
There is a consensus on that although the number of sustainability reports is increasing among corporations the
quality of these reports is still poor. It is theoretically
claimed that the current quality of Sustainability Reporting
is Unsustainable, as corporations adopt a lower level of
quality for SR than that adopted by quality assessors and
academics (Comyns et al. 2013; Latridis 2013; Gray et al.
1993; Hubbard 2011; Rupley et al. 2012).
The United Nations Conference on Trade and Development (UNCTD) reported that the decisions taken by the
corporate stakeholders become more sophisticated because
of the methods used to report on sustainability issues. It is
found that the corporate disclosed by the Islamic banks are
inconsistent. A relevant survey reveals that 50% of the
surveyed investors in addition to all the study analysts
viewed SR as poor. Latridis (2013) found that reports
including sustainability disclosures in Malaysia are very
poor in which they are general, narrative in nature, and lack
quantitative indicators to a large extent. Dawkins and Lewis
(2003) found that 54% of the investors and 43% of the
analysts believe that the quality of the information disclosed
in the corporate sustainability reports is very deficient. The
level of SR in the tourism sector is very deficient (Nobanee
and Ellili 2016; Raiborn et al. 2011; Rowbottom and Lymer
2009; Wijk and Persoon 2006. Hooks and Staden 2011)
found that a considerable number of companies in the Centre
for Business and Sustainable Development (CBSD) database
are reporting poor quality sustainability disclosures. Ane
(2012) found that the quality of the environmental reporting
in China is still very lacking, especially in relation to reliance and comparability. The study reveals that out of the 110
tested firms in different sectors of China, only 5% are
reporting environmental information in a quantitative form
and 17% in both quantitative and qualitative forms. These
percentages are very low in terms of quantitative reported
information that is more required for a qualified sustainability report as it facilitates understanding and evaluation by
188
N. A. El-Rahman