Stakeholders and regulatory pressure on ESG disclosure

Enrica Bolognesi, Alberto Burchi, John W. Goodell and Andrea Paltrinieri

International Review of Financial Analysis, 2025, vol. 103, issue C

Abstract: We focus on the impact of stakeholders' pressure on the levels of ESG transparency exhibited by companies operating under different regulatory frameworks – specifically, within voluntary or mandatory disclosure regimes – between 2012 and 2020. Our analysis encompasses European and US listed companies, each having taken distinct paths toward sustainability reporting. Europe underwent the transition to a mandatory disclosure regime with the implementation of the EU 2014 Non-Financial Reporting Directive, while the US adopted a market-based approach, often referring to disclosure frameworks established by non-governmental entities. Our findings reveal that, under the voluntary disclosure regime, higher pressure toward transparency is primarily driven by employee-oriented and environmentally sensitive companies. However, during the mandatory regime for European firms, regulatory pressure takes the place of the previously exerted pressure by stakeholders. US-listed firms are indirectly impacted by the European regulatory transition, exhibiting heightened levels of pressure on reporting demanded by stakeholders in environmentally sensitive industries, as well as by institutional investors.

Keywords: Environment; Social; Governance; ESG disclosure; Non-financial reporting; NFR directive; Stakeholders (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:103:y:2025:i:c:s1057521925002327

DOI: 10.1016/j.irfa.2025.104145

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