Sustainability Report Development in Accordance with the GRI Guidelines : Insights from Swedish and Finnish Forestry Companies

Sustainability and sustainable development is an important topic for today’s society. To manage organizational sustainability, companies use sustainability reporting to measure their performance. A new EU directive [2014/95/EU] requires all companies who have 500 or more employees, to report on non-financial information. Hence, sustainability reporting becomes more institutional. A number of different frameworks exist to help companies to report on sustainability. The most prominent framework is provided by the Global Reporting Initiative [GRI], which helps companies to disclose information on economic, social, and environmental dimensions. As the forestry industry in Sweden and Finland has been considered important for future sustainable development, this industry has been the focus in the thesis. Previous research has focused on why companies report on sustainability. The purpose of this thesis was instead to research how companies report, by investigating the development process of sustainability reports in Swedish and Finnish forestry companies. Moreover, the purpose was to create an understanding of the sustainability report development in accordance with GRI guidelines, within Swedish and Finnish forestry companies. The research question is: How do Swedish and Finnish forestry companies develop sustainability reports in accordance with the GRI guidelines? To answer the stipulated research question, the thesis adopted a qualitative method with an abductive approach. Moreover, the thesis had an descripto-exploratory research design to find relevant knowledge and findings. The thesis theoretical framework introduced concepts related to our research question: sustainability reporting, the organization GRI and their guidelines, a reporting process that was retrieved from GRI’s handbook, and the forestry industry in Sweden and Finland. In addition to this, system-oriented theories such as legitimacy theory, stakeholder theory, and institutional theory were presented. Through seven semi-structured interviews, with various managers from Swedish and Finnish forestry companies, information about the companies’ sustainability report development was collected. The thesis identified several essential segments in the report development process. These included: reasons for using GRI, planning, stakeholder engagement, materiality, data collection, and reporting. We concluded that the phases of the process presented in the theoretical framework, instead were included in a continuous process where the phases turned to segments that were integrated with each other in the companies reporting practices.