Sustainability reporting and retail sector performance: worldwide evidence

This study investigates the relationship between the level of sustainability reporting and retail sectors’ performance (operational, financial and market). Using data culled from 4065 observations from 38 different countries for ten years (2008–2017), an ‎independent variable derived from ESG score are regressed against dependent manufacture performance indicator variables [Return on Assets (ROA), Return on Equity (ROE) and Tobin’s Q (TQ)]. Two types of control variables complete the regression analysis in this study: firm-specific and macroeconomic. The findings elicited from the empirical results demonstrate that there is a significant relationship between ESG and operational performance (ROA), financial performance (ROE) and market performance (TQ). The model in this study presents a valuable analytical framework for exploring sustainability reporting as a driver of performance in retail sectors’ economies. In addition, the results of this study has significant implications for retailers, as it allows the current retailers to consider the possible sustainable activities for better outcomes, and encourages newcomers to find different sustainability approaches to attempt to offer better returns.