Sustainability balanced scorecard disclosures: an Australian investigation

The purpose of this study is to examine the extent by which the Balanced Scorecard (BSC) disclosers among the Top 100 Australian listed companies incorporate sustainability measures/targets/perspective in their performance measurement system and to analyse the level of commitment to sustainability of firms through the use of the RDAP (reactive, defensive, accommodative and proactive) model. This is an archival empirical study using content analysis to scrutinise the publicly available reports provided by the BSC disclosers. A set of index and criteria are developed to facilitate the RDAP analysis. The analyses show that for 2008 and 2007, most of the BSC disclosers incorporate sustainability measures/targets/perspective in their performance measurement system, hereafter referred to as Sustainability Balanced Scorecard (SBSC) disclosers. The results also show that the SBSC disclosers increase from 2007 to 2008. As to the commitment to sustainability, defensive profile is found to be the most dominant category within the sample in this study given that it holds the highest number of SBSC disclosers. Two major conclusions derived from the findings in this study are: (1) BSC disclosers are the ones most likely to also incorporate sustainability measures/targets/perspective in their performance measurement system; and (2) it is possible for the report users to have an understanding of the company's level of commitment to sustainability from the publicly available reports. The conclusions from this study provide support for the voluntary disclosure theory which argues that superior performers are more forthcoming in truly discretionary disclosure channels