The standard of sustainability reporting of the manufacturing sector in South Africa

Abstract

Judgement of the unfavourable social and environmental impact of international organisations has been on the rise since the early 1990’s, which has resulted in the publication of collective social and environmental sustainability reports. Companies are now not only evaluated on financial reporting, stakeholders are beginning to evaluate organisations on other dimensions, namely, the social and environmental dimensions of sustainability. The means of reporting on sustainability is through integrated reporting, which offers an opportunity to report on all aspects in one publication. There are various frameworks available that help guide companies with how to prepare and report on sustainability. Subsequent to the King III Report (King III) on Corporate Governance for South Africa that became effective in March 2010, South African companies are required to prepare sustainability reports in order to comply with good corporate governance. The purpose of this report was to determine the standard of sustainability reporting in the South African manufacturing sector and to assess the changes of reporting over a four-year period following the publication of the King III Report. The data was collected and analysed from annual and integrated reports of manufacturing organisations listed on the Johannesburg Stock Exchange (JSE). The findings of this study revealed that the standard of sustainability reporting is inferior to what the Global Reporting Initiative (GRI) framework has recommended. The findings also revealed that while reporting has improved during the four-year period, there is still need for further improvements regarding the standard of reporting.