ESG reporting − do words speak louder than actions: a grounded theory approach

Purpose Environmental, social and governance (ESG) reporting is becoming a necessity for businesses. For corporations, acknowledging the significance and outlook of a sustainable future has become vital. Corporate leaders must not only consider ESG but also actively practice it − that is, walk the talk. Using the perspective of experts, this study attempts to give a thorough explanation of the factors affecting corporates’ ESG reporting quality. This study also aims to propose a conceptual model based on the theme generated from the study. Design/methodology/approach Based on semistructured interviews with 27 experts, this study uses a grounded theory methodology. These professionals have 8–20 years of expertise in delivering, drafting or evaluating ESG reports across several industries. The respondents were chosen using the snowball sampling technique. To develop ESG reporting themes, open codes, axial codes and selective codes were created based on the data. Findings According to the study’s findings, corporate entities are reporting ESG as mandated by regulators. Seven themes emerged post-data analysis: ground reality, reporting quality and standards, due diligence and stakeholder management, corporate governance, performance-based policies, organization-related practices and the ESG of tomorrow. ESG awards were established to encourage ESG reporting is another finding of the study. This study has developed a model by examining the insights of experts. This framework will provide a thorough explanation, through the lens of experts, of the factors influencing corporates’ ESG reporting. Research limitations/implications Managers and other corporate sector workers who directly or indirectly participate in ESG activities will find the study helpful. Regulators will also find the study helpful in assessing how the established guidelines impact ESG reporting. In addition, this study will find its acceptability among analysts, consultants, nongovernmental organizations who work in the ESG domain, and their staff. ESG-conscious investors, interested in socially responsible investing will find the study helpful. Practical implications This study helps businesses comprehend different facets of ESG reporting and what steps need to be taken to ensure accurate ESG reporting. Regulators, employees, leaders, investors and other stakeholders will also find value in the findings. Through the dissemination of knowledge based on expert opinions, this study has the potential to impact educational frameworks and public policy along with providing guidance for the development of future managers and entrepreneurs who are ESG conscious. Social implications From the standpoint of a sustainable society, ESG is a more desirable notion. The results will help in increasing the public awareness and consciousness about environment, emissions, governance and stakeholder engagement. This study can also be used to impact educational frameworks that will pave way for making environmentally conscious consumers who value responsible corporate behavior. Originality/value This study uses grounded theory and a qualitative methodology, which is minimal in the body of current ESG literature. As a result, it contributes to the information-gathering process and increases the uniqueness of this study. This study also provides a conceptual model that can be tested empirically to gauge ESG reporting quality.