Sustainability Reporting Quality and Stakeholder Engagement Assessment: The Case of the Paper Sector at the Iberian Level

Abstract

Materiality assessment identifies the main issues to be disclosed in non-financial reports to respond to the concerns of stakeholders, thus improving the quality of those reports. The purpose of this research is to understand whether there is a relationship between the quality of non-financial reports and the application of standards such as the Global Reporting Initiative (GRI) and the International Integrated Reporting Council (IIRC), as well as between the impact of stakeholder engagement and the adoption of the materiality principle. To do so, manual content analysis was performed on companies from the paper industry in the Iberian Peninsula that published non-financial reports in accordance with the GRI and/or IIRC standards during the period between 2015 and 2020. The sample consists of 133 company-year observations, and data were collected through content analysis of the reports. The results show that companies that more scrupulously follow the GRI and/or IIRC standards and those that pay more attention to the relationship with their stakeholders show higher levels of materiality, meaning higher quality of reports. In addition, it is also noticeable that, over the years, the concern with these disclosures has increased, reflecting an increase in attention given to materiality.