The Adoption of the Corporate Sustainability Reporting Directive by the EU Banking Sector: An Empirical Investigation

Citizens’ growing sensitivity to sustainability issues requests EU authorities to issue increasingly stringent regulations for companies to delimit the concept of sustainable development. The CSRD is the latest development of an exhaustive framework concerning the provision of a wide range of issues. Although the CSRD refers to specific standards to show companies’ compliance level with the ESG, it does not ensure they consider sustainability as a strategic lever capable of generating competitive value and transforming business models. For this reason, accountability scholars are promoting a more complex tool named integrated reporting, finalized to integrate financial with non-financial information. This study aims to evaluate the consistence of sustainability disclosure among the largest twenty EU banks with the integrated reporting guiding principles and indirectly the qualitative level of voluntary disclosure. The interest in the banking sector is linked to their strong direct sustainability impact, but also to the leading role towards the multitude of companies borrowing money, inducing them to follow sustainability principles. The findings of the study show that the consistence of non-financial disclosure with principles are quite high, although wide differences among banks exist, as well as among the issues considered. Particularly, the wider gaps concern the outlook and the formal and methodological quality. Many implications emerge from this research stimulating policy makers to propose tools encouraging banks to improve the linkages among financial and non-financial disclosure