RT Journal Article
T1 When Sustainability Reporting Becomes a Strategy: The Impact of Financial Performance and Institutional Pressures From EU Sustainability Reporting Regulations on ESG Decoupling
A1 Cepêda, Catarina
A1 Monteiro, Albertina Paula
A1 Aibar Guzmán, Cristina
K1 Corporate sustainability reporting directive
K1 ESG decoupling
K1 Financial performance
K1 Firm value
K1 Non-financial reporting directive
K1 Sustainability reporting
AB Mitigating environmental, social, and governance (ESG) decoupling is essential to advancing reliable sustainability disclosure and ensuring that ESG reporting fulfills its intended purpose. This study aims to provide critical insights into the organizational and contextual elements that could intensify or diminish ESG decoupling. Using a multi-theoretical framework, this study examines the impact of firm value and institutional pressures from the European Union's sustainability reporting directives on ESG decoupling. The empirical findings, based on a random-effects panel regression analysis of data from 3465 large companies from 2009 to 2023 (13,488 firm-year observations), indicate that firms with higher financial performance and market value are more likely to engage in ESG decoupling. Conversely, the results demonstrate that normative and coercive pressures from the European Union's sustainability reporting directives result in greater alignment between ESG disclosures and performance. These findings offer researchers, regulators, investors, stakeholders, and ESG rating agencies additional insight into ESG decoupling and carry significant policy implications.
PB Wiley
SN 1535-3958
YR 2026
FD 2026-04-06
LK https://hdl.handle.net/10347/47331
UL https://hdl.handle.net/10347/47331
LA eng
NO Cepêda, C., Monteiro, A. P., & Aibar-Guzmán, C. (2026). When Sustainability Reporting Becomes a Strategy: The Impact of Financial Performance and Institutional Pressures From EU Sustainability Reporting Regulations on ESG Decoupling. "Corporate Social Responsibility and Environmental Management", 1-25. https://doi.org/10.1002/CSR.70569
NO This work is part of the R&D&I project PID2024-155692NB-I00 funded by MICIU/AEI/10.13039/501100011033 and by ERDF/EU. This work is financed by portuguese national funds through FCT - Fundação para a Ciência e Tecnologia, under the project UID/05422/2025: Centre for Organisational and Social Studies of Polytechnic of Porto. This study was conducted at the Research Center on Accounting and Taxation (CICF) and was funded by the Portuguese Foundation for Science and Technology (FCT) through national funds with the reference UID/04043/2025 and doi https://doi.org/10.54499/UID/04043/2025.
DS Minerva
RD 23 may 2026